Mastercard and Cardstream Partner to Deliver Comprehensive Open Banking Solution
Mastercard teams up with Cardstream for Open Banking transaction solutions
In a move aimed at empowering both issuing and acquiring customers, financial technology company Cardstream has partnered with Mastercard to provide a comprehensive Open Banking solution. This partnership is part of Mastercard's ongoing commitment to fostering an innovative, accessible, and secure payments ecosystem.
The new solution, built on Mastercard's Open Banking technology, will support single immediate payments and prepare businesses and consumers in the UK for commercial variable recurring payments (cVRPs). cVRPs, due to rollout across Europe and the UK later this year, will allow people to pay for recurrent bills directly from their bank account.
This partnership is significant as Mastercard is one of 31 firms that have committed to fund the creation of a new company for the initial phase of cVRP, as announced by Open Banking Limited last week. The creation of this company for the initial phase of cVRP was also announced by Open Banking Limited last week.
The partnership between Mastercard and Cardstream offers a turnkey solution that allows payment providers to launch branded Open Banking Merchant Services quickly. Cardstream's PFaaS and gateway technology processes, collects, and disburses Open Banking transactions to merchants, enabling "seamless" bank connectivity.
The partnership will enable acquirers, payment facilitators, and payment channels using Cardstream to offer their merchant customers the option to accept Open Banking payments, alongside traditional forms of payments like debit and credit cards. Mastercard has a history of collaborating with Cardstream on innovations like network tokenization and Click to Pay.
Adam Sharpe, chief executive officer of Cardstream, stated that there's strong demand for Open Banking payments as a secure and convenient way to pay alongside cards. He expressed excitement about the partnership, which will enhance payment choice for customers of payment providers using Cardstream.
The top Open Banking use cases among businesses and consumers, as revealed by Mastercard, include fraud prevention, account-to-account payments, enhanced payment flexibility, and improved financial control and convenience for consumers. Mastercard highlights the use of Open Banking to securely share financial data with third-party providers as central for future growth.
Valerie Nowak, executive vice president, head of Open Banking, APEMEA at Mastercard, expressed excitement about the significant growth of the Open Banking market in Europe. She emphasized that Mastercard's initiative, such as "Mastercard Account to Account Protect," focuses on fraud prevention while supporting payment methods like debit, credit, prepaid, and stablecoins.
Open Banking fosters seamless account opening, instant loan approvals, and personalized payment preferences, which match consumers’ increasing desire for control over their finances and convenient services. For businesses, Open Banking enables real-time payments, account-based payments, and interoperability across various payment rails, supporting a broad payments ecosystem that includes traditional cards, bank accounts, digital wallets, and decentralized finance assets.
Overall, Mastercard positions Open Banking as a driver of secure, flexible, and efficient financial services that benefit both consumers and businesses, underpinning a future digital economy enhanced by AI, stablecoins, and new payment technologies.
[1] Mastercard (2021). Mastercard Open Banking Services UK Commits to Funding the Creation of a New Company for the Initial Phase of cVRP. [online] Available at: https://newsroom.mastercard.com/mastercard-news/mastercard-open-banking-services-uk-commits-to-funding-the-creation-of-a-new-company-for-the-initial-phase-of-cvrp/
[4] Mastercard (2021). Mastercard's Open Banking Strategy: Driving Secure, Flexible, and Efficient Financial Services. [online] Available at: https://newsroom.mastercard.com/mastercard-news/mastercards-open-banking-strategy-driving-secure-flexible-and-efficient-financial-services/
[5] Mastercard (2021). The Future of Open Banking: Mastercard's Vision for a Seamless, Secure, and Convenient Payments Ecosystem. [online] Available at: https://newsroom.mastercard.com/mastercard-news/the-future-of-open-banking-mastercards-vision-for-a-seamless-secure-and-convenient-payments-ecosystem/
- The partnership between Mastercard and Cardstream utilizes Mastercard's Open Banking technology to offer a turnkey solution that supports single immediate payments and prepares UK businesses and consumers for commercial variable recurring payments (cVRPs).
- Mastercard, alongside 30 other firms, has committed to funding the creation of a new company for the initial phase of cVRP, as announced by Open Banking Limited last week.
- The new solution provided by the partnership will also support payment providers in launching branded Open Banking Merchant Services quickly, leveraging Cardstream's PFaaS and gateway technology.
- This collaboration enables payment providers using Cardstream to offer their merchant customers the option to accept Open Banking payments, alongside traditional forms of payments like debit and credit cards.
- Mastercard envisions Open Banking as a crucial component of a secure, flexible, and efficient digital economy, fostering seamless account opening, real-time payments, and interoperability across various payment rails.
