Mastercard well positioned in soaring virtual card market

Among firms with the reach and resources to push payments wholly into the digital space, Mastercard ranks high on the list. The company is leaning hard into tokenized payments, having promised last year to move to biometrics and tokenization only for online checkout by 2030.

In a new interview with Yahoo Finance, Mastercard (MA) president for the Americas Linda Kirkpatrick doubles down on that promise (though not necessarily on the date). “We do see a day maybe at some point in the future where every transaction will be done digitally,” Kirkpatrick says. But, “we’re not there yet.”

“If you look at our data, 70 percent of ‘card present’ transactions around the globe are now done through contactless means – tapping a card or tapping a phone at a turnstile. And now we’re seeing 30 percent of our transactions tokenized. So consumers are getting much more comfortable with transacting through digital means, and as we see that trend evolving, our investment in safety and security tools becomes even more important.”

Per the report, Mastercard has deployed $10 billion over the past seven years toward safety and security tools, including the acquisition of threat intelligence company Recorded Future.

Virtual card market to be worth $17.4 trillion by 2029

The days of being a “credit card company” are long gone, and physical cards may be soon, too: a new study from Juniper Research says the value of virtual card payments will grow 235 percent by 2029, rising from $5.2 trillion in 2025 to more than $17.4 trillion.

Drivers include the subscription economy in both B2B and consumer markets, driving what Jumpier says is “a surge in demand for seamless recurring payment solutions that virtual cards are uniquely positioned to deliver.” Companies seeking to balance automation with oversight when making high-value recurring payments will be avid customers, given virtual cards’ options for setting limits, tracking payments in real-time and assigning cards to specific entities.

Emerging markets are a hotspot for digital subscriptions from overseas companies; Jupiter says to harness the opportunity, “virtual card providers should partner with telecoms companies to offer virtual cards to their vast customer bases.”

For Visa, key tenet is keeping biometrics on-device

Some virtual cards are starting to offer biometric technology that lets you use your face or fingerprint to confirm a payment via a digital wallet. But the question of biometric physical cards lingers. An article in CNET looks at cards that store biometric information within a scanner on the physical credit card, rather than on the cloud.

The piece quotes Mark Nelsen, global head of consumer payments at Visa, who says “one of our key tenants for anything we’re doing in biometrics – for both the Visa Payment Passkey and the physical biometric template on the card – it’s just stored on the individual device.”

Article Topics

biometric authentication  |  biometric cards  |  biometric payments  |  biometrics  |  digital wallets  |  ecommerce  |  Mastercard  |  tokenization  |  Visa