MasterCard’s Big Interactive Payments Bet

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By PYMNTS @pymnts

6:15 AM EST December 9th, 2014

“We see a future where every device becomes a commerce device. This not only includes a shift in mobile-based payments, but also a move from ‘static’ plastic to ‘dynamic’ interactive payment cards and systems.”

That’s MasterCard Group Exec, Global Credit and Debit Products Carlos Menendez commenting on the company’s recent investment in a dynamic card that, literally, powers payments at existing points of sale.

MasterCard and Dynamics Inc., a company that designs and manufactures intelligent battery-powered payment devices and advanced payment platforms, are partnering in a commercial initiative to drive innovation in the interactive payment card market, according to a MasterCard release.

The initiative follows the recent announcement of Dynamics’ Series C funding of $70 million, as a result of which its new investors MasterCard and CIBC joined existing backers Bain Capital Ventures and Adams Capital Management. Thanks to the partnership, MasterCard will now offer exclusive Dynamics products to its issuers worldwide. These products aim to provide consumers with added choice, flexibility and security at the point of sale.

Dynamics’ technology and manufacturing capabilities make payment cards that let users “meaningfully differentiate their card products” and “provide extraordinary payment functionality to their cardholders.” More specifically, Dynamic interactive payments cards are equipped with buttons, displays and LEDs that let consumers select apps that are stored directly on the card itself – and every card is completely compatible with existing POS terminals.

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Credit/Debit: This card enables consumers to access either their debit or credit accounts. The world’s first interactive payment card technology incorporates a tiny built-in computer to deliver consumers unprecedented control, convenience and security.

“Interactive payment cards give cardholders an unprecedented level of customization, control and security at each and every purchase at any point-of-sale device in the world,” said Jeff Mullen, CEO of Dynamics, in the release.

He added that interactive payments cards also let banks expand card offerings, providing cardholders with many additional on-card payment options that they can select at purchase. These features include cards that offer consumers multiple selectable currencies, access to both debit and credit accounts, and cards with a co-brand that offer credit or debit in conjunction with a separate loyalty application.

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Multiple Currencies: Interactive Payment Cards from MasterCard and Dynamics, Inc. Consumers can instantly switch with the touch of a button with this card.

“By giving consumers easy access to additional options, banks can enable several business models on a single card while building brand and enhanced cardholder relationship with each purchase,” explained Mullen.

Furthermore, MasterCard’s expertise in safety and security will also enable both companies to develop new security-oriented products around the world. Together, they will deliver innovative payment cards to issuers for a global consumer base that’s increasingly moving away from cash, said MasterCard.

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For enhanced security, Dynamics interactive payment cards can include a display and keypad. When a consumer enters the correct unlocking code into the buttons, the payment card number is provided on a display (for online) and is written to the strip (for in-store).

“In working with Dynamics, we have secured a partner with deep technology capabilities and market-leading manufacturing capabilities to help drive innovation in the interactive payment card market,” said Carlos Menendez, Group Executive, Global Credit and Debit Products at MasterCard. He noted that MasterCard would do so all while moving in lockstep with its mobile and digital enablement strategy.

“We see a future where every device becomes a commerce device. This not only includes a shift in mobile-based payments, but also a move from ‘static’ plastic to ‘dynamic’ interactive payment cards and systems,” he said.