Mastercard Incorporated (NYSE:MA) Morgan Stanley Financials Conference Call June 11, 2019 3:15 PM ET
Linda Kirkpatrick - EVP, U.S. Merchants and Acceptance
- Linda Kirkpatrick - 执行副总裁，美国商人和接受人
All right. We'll go ahead and get started for our last session of the day in our FinTech symposium. I want to really thank everybody for coming out today. And I think it's been a great opportunity to learn about a lot of different aspects within the FinTech area, particularly in payments and what's been going on and all the different facets, or at least a lot of the different facets of that.
Before we get started with Mastercard, I do have to read a quick disclosure. Please note that all important disclosures including personal holdings disclosures and Morgan Stanley disclosures appear on the Morgan Stanley public website at morganstanley.com/research disclosures, or at the registration desk.
So, to wrap up today, very pleased today to have Linda Kirkpatrick, EVP of Merchants and Acceptance here in the U.S. Linda, thank you very much for being here. And I should also point out that Warren Kneeshaw, the Head of Investor Relations is here. As I always say, in case we screw up here, Warren you can help.
So, Linda, can you share a little bit about your background and your current role and responsibilities at Mastercard help us conceptualize exactly what you're doing?
- 所以，今天结束，非常高兴今天在美国Linda有商人和接受执行副总裁Linda Kirkpatrick，非常感谢你来到这里。我还应该指出，投资者关系主管Warren Kneeshaw就在这里。正如我经常说的，万一我们搞砸了，沃伦你可以帮忙。
Sure. So, I have been with MasterCard for 22 years across a variety of different roles on both on the support side. I was in finance and Investor Relations and planning, as well as on the frontline, supporting customers. The past three years, I've been responsible for a merchant and acceptance business, which is essentially all of our merchant relationships, acquiring bank relationships, and business development efforts on the cobrand, commercial, prepaid, healthcare and transit side.
当然。 因此，我在MasterCard工作了22年，在支持方面担任各种不同的角色。 我从事金融和投资者关系和规划，以及前线，支持客户。 在过去三年中，我一直负责商家和接受业务，这基本上是我们所有的商家关系，收购银行关系，以及在cobrand，商业，预付费，医疗保健和运输方面的业务发展工作。
Interesting. So, can you talk about exactly what that means from an acceptance and merchant development strategy? I mean -- and I guess, I don't mean to be flip, but most places I go, they accept Mastercard, not all but most places except Mastercard. And how does that that effort or your job tie into the broader grow diversified build strategy that the Company's outlined?
有趣。 那么，你能谈谈接受和商业发展战略究竟意味着什么吗？ 我的意思是 - 我猜，我不是故意要翻转，但我去的大多数地方，他们接受万事达卡，除了万事达卡以外的大多数地方。 那个努力或你的工作如何与更广泛的公司概述的多元化建设战略相结合？
So, we've got merchant relationships across a variety of verticals that span from retail to travel to drug and grocery to fuel. And we've got the largest relationships across those verticals. So, about 250 managed relationships. And those merchants, while they accept our products, there's lots of things that we're doing with them to support their overall strategies and their go-to-market, both in the physical and the digital space. And so, when you look at the grow, diversify, build pillars that Mastercard talks about overall as a corporate landscape, the grow means growing the core on the credit and debit and commercial and prepaid side, as well as growing our acceptance footprint. And so, the merchant community through our co-brand agreements, growing credit is squarely aligned with that. And then, from an acceptance perspective, there is still many verticals like insurance, utilities, education, rents that are underpenetrated with electronic payments. So, it’s our job to work with aggregators in the space and acquirers in the space to encourage them to turn on electronic payments and again, to add value-added solutions to their business so that they see the benefit of working with the network.
So, in the last session we had a very interesting conversation with a Company by the name of Repay and you may not know them. But Repay, basically what they're doing is they're essentially enabling debit payment for things like auto loans, et cetera. And what they find is that where historically that may have been done by cash check or ACH is that there's a strong consumer preference for debit. And the point that I often make to investors as they talk about things like direct bank to bank transfers is that, okay that may or may not be beneficial for a merchant, but as a consumer, I almost never should choose that because debit affords me a lot of benefits in a lot of cases. And so, when -- how do you communicate that to merchants and demonstrate to these verticals like look, there really is demand and value and benefit to you as the merchant when I think a lot of times the reaction has been like well, we've never done that, why would we do that, et cetera?
因此，在上一次会议中，我们与一家名为Repay的公司进行了非常有趣的对话，您可能不了解它们。 但是，回报，基本上他们正在做的是他们基本上可以为汽车贷款等等借记支付。 他们发现，在历史上可能通过现金支票或ACH完成的是消费者对借记的偏好。 我经常向投资者提出直接银行到银行转账等问题的观点是，对商家来说可能有利也可能没有益处，但作为消费者，我几乎从不应该选择那个，因为借记给了我 在很多情况下有很多好处。 所以，什么时候 - 你如何与商家沟通并展示这些垂直行业，就像看起来一样，当我认为很多时候反应一直很好的时候，对你来说确实有需求，价值和利益，我们' 从来没有这样做过，为什么我们会这样做，等等？
Yes. When we explain the value, I think everyone understands the value that payments brings to the table with respect to guaranteed payments. Recurring bill pay models in particular benefit from having a card on file. Giving their -- giving customers the utility to pay later -- pay now through debt or pay later through credit, and generate rewards and loyalty creates this level of stickiness that they wouldn't get otherwise through ACH or other methods. And so, really, it's a conversation around turning it on and making sure that -- to get scale in a lot of these verticals, you need to approach third parties who have already partnered with rents for example. We work with a company called YapStone that manages 20% of the rent market, both on property manager side as well as on the renter side. And they've already established these partnerships with the communities that we're trying to reach. And so, partnering with them made a heck of a lot of sense because they could light up multiple rents, partners and companies with one fell swoop. And so, making sure we understand what their needs are, how we can add value through services, and how we can partner with them to make it a streamlined process is advantageous to us because again, every location that we're turning on drives volumes to a very scalable network and drives ongoing growth of digital in those categories. So, it's -- we're very much aligned around that to grow and that also falls in the grow bucket.
In the diversify bucket, we are very focused on partnering with governments, transit companies, healthcare providers. So, the relationships that we're building in that base are really with the goal of diversifying our customer base and thereby diversifying our revenues.
And then in the build category, this is all lead us back to the data and analytics, the fraud, the safety and security, all of the acquisitions that we've made to support merchants, acquirers and other partners in their efforts to grow their business. So, it's a -- it couldn't be more aligned from a strategic perspective from the business that I look after.
是。当我们解释这个价值时，我想每个人都理解付款在保证付款方面带来的价值。经常性的账单支付模式特别受益于存档卡。给予他们 - 给予客户后期支付的效用 - 现在通过债务支付或稍后通过信贷支付，并产生奖励和忠诚度创造了他们通过ACH或其他方法无法获得的这种粘性水平。所以，真的，这是一个关于开启并确保 - 在大量垂直方面获得规模的对话，你需要接近已经与租金合作的第三方的对话。我们与一家名为YapStone的公司合作，该公司管理着20％的租赁市场，无论是在物业经理方还是在租赁方。他们已经与我们想要达到的社区建立了这些合作伙伴关系。因此，与他们合作产生了很多意义，因为他们可以一举点亮多个租金，合作伙伴和公司。因此，确保我们了解他们的需求是什么，我们如何通过服务增加价值，以及我们如何与他们合作以使其成为简化流程对我们有利，因为我们正在开启的每个位置都会带来成交量一个可扩展的网络，推动这些类别的数字化持续增长。所以，它是 - 我们非常关注那种增长，并且也属于增长桶。
然后在构建类别中，这将引导我们回到数据和分析，欺诈，安全和安全，以及我们为支持商家，收单机构和其他合作伙伴努力发展他们所做的所有收购。商业。所以，它是一个 - 从战略角度来看，它与我所关注的业务不一致。
So, turning to another aspect of kind of the FinTech world generally is that we track the amount of DC investment in FinTechs, et cetera. And I think a lot of times when we meet with public investors, the view is like, oh, so much of that investment is going to end up proving or at least intending to be disruptive to incumbents, like Mastercard, et cetera. But what I see is like, it's really hard for a lot of those investments to realize their full potential, and they come up with interesting solutions, but scaling them is very difficult. And this is where, I feel like, it creates opportunities that Mastercard has been particularly active in pursuing and looking at -- and via M&A, saying okay, as these proofs of concepts are built out and you can start to demonstrate that they can deliver the capabilities, it creates an interesting opportunity. And that's something that Mastercard particularly has been active in this year and last year, et cetera. Several of these announced acquisitions like Vyze, Ethoca, Transactis, all impact to how Mastercard engages with merchants -- with acquirers and merchants. Can you provide some incremental detail on -- and color on these acquisitions and the strategic rationale behind them? Like, what are the improvements that you're chasing through these acquisitions?
因此，转向FinTech世界的另一个方面通常是我们跟踪FinTechs等的DC投资额。我认为很多时候，当我们与公众投资者见面时，观点就像是，哦，这么多的投资最终会证明或者至少打算破坏现有企业，如Mastercard等等。但我所看到的是，很多这些投资很难实现其全部潜力，并且他们提出了有趣的解决方案，但扩展它们非常困难。我觉得这就是Mastercard在追求和关注时特别活跃的机会 - 并且通过并购，说好的，因为这些概念证据已经建立起来，你可以开始证明他们可以提供能力，它创造了一个有趣的机会。这就是万事达卡在今年和去年特别活跃的事情，等等。其中一些宣布的收购活动，如Vyze，Ethoca，Transactis，都会影响万事达卡与商家的关系 - 收购商和商家。您能否就这些收购及其背后的战略理由提供一些增量细节和颜色？比如，您通过这些收购追求的改进是什么？
Sure. So, we're looking at our M&A strategy in the context of a few perspectives. The first is, do they extend Mastercard position in the value chain beyond what we do today? Do they allow us speed to market in terms of what we're trying to accelerate the pace of change and the pace of growth or do they provide us with capabilities that we don't already have. And as we look at the grow, diversify, build strategy, because we want to be a partner to these -- to merchants and to acquirers, it only makes sense that we would look at companies that actually appeal to the merchants and the acquirers’ needs and provide value-added services to them, so that they can extend to their customers.
So, the few acquisitions you mentioned, Vyze is a point-of-sale financing solution. All of us today who transact online have probably encountered a point-of-sale financing solution in one way, shape or form. It's not just for large clients, it's for basically -- it could be for clothing or for small ticket purchases as well. And what we've acquired is an entity that allows us to connect merchants with lenders. So, without taking on any of the financing risk, we simply serve as the gating feature between a merchant and the lender. And we provide choice at the point-of-sale to the consumer that wants to finance their purchase. So, it's very much in demand right now. And we felt that it was closely aligned with our strategy to add value to merchants.
当然。因此，我们在几个方面的背景下看待我们的并购战略。首先，他们是否将价值链中的万事达卡位置扩展到我们今天所做的范围之外？它们是否允许我们根据我们试图加快变革步伐和增长速度的方式加快产品上市速度，或者它们是否为我们提供了我们尚未拥有的能力。当我们看到增长，多样化，制定战略时，因为我们希望成为这些的合作伙伴 - 对于商家和收购者来说，我们只关注那些真正吸引商家和收购者的公司才有意义。需要并为他们提供增值服务，以便他们可以扩展到他们的客户。
Can you just give a little bit of color Vyze, like you mentioned, like there's going to be a whole gamut of point-of-sale financing. Like we’re focused historically in terms of ticket size or type of transaction, and where do you think you can take that?
Yes. So, they have a number of merchant partners already in the large ticket space, and they're looking to expand that beyond. And, we believe with our acceptance network and with our access to issuer partners who are also in this space, it's really a perfect marriage of what we can do to bring value to the table on both sides of the house, again, without taking any risk to our balance sheet. So, for us, it’s, you know, tacking that on in a way that's integratable into other products and services that we provide, including our gateway, which many of our merchants and acquirers are connected to already.
Ethoca is another good example of extending our role in the value chain. So Ethoca works with thousands of merchants already to connect merchants and issuers when a fraud event occurs. So, real time notification of a fraud event from the issuer to the merchants, so that they can stop payment or stop fulfillment before the fraud takes place and before a chargeback has to be realized. And so, you can imagine, taking Ethoca and plugging and playing it into our other cyber and security tools, and/or our gateway, continues to add value in that space. And similarly, with Transactis, which is a bill pay and presentment tool, ties very nicely to our Bill Pay Exchange product that we announced last year.
Ethoca是扩展我们在价值链中的角色的另一个好例子。因此，当欺诈事件发生时，Ethoca已经与成千上万的商家合作，将商家和发行人连接起来。因此，从发行者到商家的欺诈事件的实时通知，使得他们可以在欺诈发生之前和必须实现退款之前停止支付或停止履行。因此，您可以想象，将Ethoca插入并将其插入我们的其他网络和安全工具和/或我们的网关，继续为该领域增加价值。同样，Transactis是一种账单支付和展示工具，与我们去年宣布的Bill Pay Exchange产品关系非常好。
So, it sounds like Vyze already had at least some merchant relationships. What about Ethoca and Transactis? Like, what was their level of engagement with merchants before the acquisition? And what are you planning in terms of the engagement with merchants more broadly, especially now that they're under the Mastercard umbrella?
所以，听起来Vyze至少已经拥有了一些商人关系。 那么Ethoca和Transactis呢？ 就像，他们在收购前与商家的接触程度如何？ 你在更广泛地与商家交往方面有什么计划，特别是现在他们在万事达卡的保护伞下？
So, Ethoca has thousands of merchants that are already their customers, particularly in the digital space, as well as relationships with issuers? So, they're already deeply entrenched in the payments ecosystem. And since the announcement, frankly, just a couple of weeks ago, we actually -- we had terrific feedback from partners that are very interested in how we can combine Mastercard assets and Ethoca assets to make it even more powerful. So, all three of those transactions have been well-received by the merchant and acquire community. And given the evolution that's going on, on the acquirer side in particular, it couldn't be better timing in terms of our ability to add value to our partners.
那么，Ethoca有成千上万的商家已经是他们的客户，特别是在数字领域，以及与发行人的关系？ 因此，他们已经深深扎根于支付生态系统中。 坦率地说，就在几个星期前，我们实际上已经 - 我们收到了很多合作伙伴的反馈，他们非常感兴趣我们如何将Mastercard资产和Ethoca资产结合起来，使其更加强大。 因此，所有这三笔交易都得到了商家和社区的好评。 鉴于正在发生的演变，特别是在收购方方面，就我们为合作伙伴增加价值的能力而言，它不可能是更好的时机。
Right. So, turning to another areas that Mastercard has been successful in winning a number of notable cobrand portfolios over the last few years. And in fact, probably one of the most frequent questions we've started to get from investors is, why is Mastercard winning these? And my response typically is like, Ajay is very charismatic. But beyond that, I don't really know. And so, I'd love to hear from you your color on what has enabled Mastercard to make -- be successful in the cobranding segment? And how do you view the opportunity to continue to make some of these wins going forward? I mean, is it really Ajay or the charisma that comes out or what else is going on?
对。 因此，转向另一个领域，万事达卡在过去几年中成功赢得了许多着名的cobrand投资组合。 事实上，可能是我们从投资者那里得到的最常见问题之一，为什么万事达卡会赢得这些？ 而我的反应通常就像是，Ajay很有魅力。 但除此之外，我真的不知道。 所以，我很想听听你在万事达卡制作方面的颜色 - 在共同品牌领域取得成功吗？ 您如何看待继续取得一些胜利的机会？ 我的意思是，它是真的是Ajay还是出现的魅力或者还有什么？
You're right about Ajay’s charisma. But in addition to that, we also have a partnership-driven approach with the merchant community. So, I mentioned earlier the way we cover merchants, we do it in a very vertical based way. We have experts that manage these verticals, who came from those verticals. So, our head of retail came from the retail industry, our head of fuel from the fuel industry, et cetera. So, when they manage a relationship in that space, they can talk the talk of the partner that they're meeting with. It's not simply a payments conversation; it's a conversation about how to support their strategy end to end. So, it starts with the partnerships and the relationships and understanding the needs of the partner. And then, it's really demonstrating how we can add value to them on the data and services side, product and innovation side, safety and security side that complements the cobrand and gives them the potential to grow the cobrand beyond, what they could do without us.
And that is something that over the past five years we've done direct deals with merchants, in addition to the issuers because you need three parties in a cobrand relationship to demonstrate our value. And the message always is, we care about your cobrand of course, we've grown credit share as a result of winning a number of cobrand agreements with Bass Pro and Kroger and Target and L.L. Bean. We also have Walmart and Sam's. So, we have a significant share of the cobrand market. We punch above our weight with respect to our national share in the U.S. We have greater than 40% share in the cobrand space. That's nice that we can support them in that way. But it's really the value added services that come underneath our ability to support their business in its entirety. And when they see our marketing and our product and our innovation, and all of the other services that we can bring to the table as a result of the co-brand partnership, that's what gets them excited.
And so, that that model is pretty unique to us, because we've been very methodically investing in products and services to support these customers. And 10 years ago, we didn't have the collection of assets that we have today. So, largely, our cobrand efforts were directed to the issuers. And now, they're directed very carefully with the merchants. And if you talk to them, I think what they tell you is we have a great partnership model, we have great capabilities that help them differentiate in the market, and we've got the ability to jumpstart growth in the cobrand because we have such good insights into how their customers are spending when they're not spending with them. And so, we can come out with loyalty play, segmentation play, acquisition play, we just help them to be smarter and how they go after new customers.
So, can I have just like a maybe a prototypical example of like a brand like that comes to Mastercard, like what is the aspiration of that brand that starts the conversation? And then, through that -- through those engagements, what do they realize? Oh, wait, Mastercard can do all these incremental things, can you give us like maybe a specific type of example or something that we could imagine?
那么，我是否可以像一个像Mastercard这样的品牌的典型例子，就像开始谈话的品牌的愿望一样？ 然后，通过这些 - 通过这些约定，他们意识到了什么？ 哦，等等，万事达卡可以做所有这些增量的事情，你能给我们一些特定类型的例子或我们可以想象的东西吗？
Sure. So, on the retail side, for example, we could come to the table with a retail partner like L.L. Bean…
当然。 因此，在零售方面，例如，我们可以与像L.L. Bean这样的零售合作伙伴来到这里。
And what would be L.L. Bean's initial aspirations in a cobrand?
They -- L.L. Bean does a great job of tying their loyalty program with their cobrand program. So, they are very focused on growing the cobrand portfolio with Citi, their sure. And from our perspective, what we could bring to the table to them is not only our Priceless assets that complement their own marketing assets, but also any innovation that we have in retail that can help drive digital engagement or digital integration within their physical footprint.
So, these are investments that -- and partnerships that we have with third parties that can help them re-imagine the consumer interface on their app or the purchasing experience in the store. And so that -- again, that's the broader merchant strategy that isn’t just a co-brand strategy, but the two are inextricably linked because if you can integrate those capabilities into the cobrand, you actually make it more valuable to your customer. They're very good at loyalty and they're a retailer that's growing in very difficult market. And we're delighted to be their partner on this journey. But it is truly a partnership. So, they would look to us to support them on data, on product, on marketing, the full gamut of products we can bring to bear.
因此，这些投资 - 以及我们与第三方建立的合作伙伴关系可以帮助他们重新设想应用程序上的消费者界面或商店中的购买体验。所以 - 再次，这是更广泛的商业战略，不仅仅是一个联合品牌战略，但两者是密不可分的，因为如果你可以将这些功能整合到cobrand，你实际上使它对你的客户更有价值。他们非常擅长忠诚度，而且他们是一个在非常困难的市场中成长的零售商。在这次旅程中，我们很高兴成为他们的合作伙伴。但这确实是一种伙伴关系。因此，他们希望我们在数据，产品，营销以及我们可以承担的全部产品上支持他们。
And in terms of services that you bring to them, does that end up limiting your partnership opportunities within that segment of retail or do you feel like there -- that you can deliver similar type services and benefits to all of L.L. Bean’s frankly competitors?
在您带给他们的服务方面，这最终会限制您在该零售业中的合作机会，或者您是否觉得 - 您可以为所有L.L. Bean的坦诚竞争者提供类似的服务和福利？
From our perspective, each merchant has their own strategy that is unique to their brand and unto themselves. So, our job is not to drive or direct their strategy, but to support their strategy. And so, by nature of the fact that each of their strategies is unique and different, the way we support them is going to be unique and different. I think Priceless is -- our marketing assets can scale pretty deeply and can resonate pretty closely with partners across travel, retail, you name it. So, that's something that's pretty ubiquitous across the board. But, the execution of each individual merchant strategy is going to be different. And so, it's not a problem…
从我们的角度来看，每个商家都有自己的战略，这个战略对于他们的品牌和他们自己都是独一无二的 因此，我们的工作不是推动或指导他们的战略，而是支持他们的战略。 因此，从他们的每个战略都是独特和不同的事实的性质来看，我们支持他们的方式将是独特和不同的。 我认为无价格是 - 我们的营销资产可以非常深入地扩展，并且可以与旅行，零售等合作伙伴密切合作。 所以，这是一种无处不在的东西。 但是，每个商家战略的执行情况将会有所不同。 所以，这不是问题......
With respect to competition.
So, you’ve talked a little bit about services, et cetera. Can you talk about Mastercard strategy as it relates to services? It's generally expected to outgrow the core business. Do you talk about what's driving this growth and how is that incremental, and then how do you think about at least traditionally in businesses on services, we think about things like attach rates, et cetera, like, how are you measuring those et cetera?
所以，你已经谈了很多关于服务的事情，等等。 你能谈谈与服务有关的万事达卡策略吗？ 人们普遍预计它将超过核心业务。 你是在谈论推动这种增长的因素，以及如何逐步增加，然后你如何考虑至少传统的服务业务，我们考虑附加率等等，比如，你如何衡量这些等等？
So, our services as a percent of overall revenue, so it's about a quarter of our revenue now. It's been growing. And we've been very focused on diversifying our revenue base to not only add more value to our customers but to ensure that we're protecting our model for the future. And so, our strategy is very much looking at the needs of our customers. And again, we’re a B2B2C company.
因此，我们的服务占总收入的百分比，因此现在约占我们收入的四分之一。 它一直在增长。 我们一直非常注重多元化我们的收入基础，不仅为我们的客户增加更多价值，而且确保我们为未来保护我们的模型。 因此，我们的战略非常关注客户的需求。 我们再次成为B2B2C公司。
So, customer as we define it is -- it's a bank, it's a merchant, it's a government entity, it's corporate. They are driven by consumer needs. But our job is to make sure we are covering off on our customer needs, our B2B. And so, all the acquisitions we've made, all the investments that we've struck are all in support of that B2B2C model. And when we think about the buckets where we've invested the most, because we see the most opportunity, data and services in the form of data and analytics, test and learn, loyalty capabilities that’s a strong area of focus, cyber and intelligence with all of the fraud and safety security capabilities that we've built internally and acquired, and then, really the checkout capabilities that we can bring to the table and partner with others to make sure that that's secure and seamless. So, those are really three buckets of extensions -- vertical extensions, and horizontal extensions to our strategy that we focus on the services.
因此，我们定义的客户是 - 它是一家银行，它是一个商人，它是一个政府实体，它是企业。 它们受消费者需求的驱动。 但我们的工作是确保我们能够满足客户的需求，即B2B。 因此，我们所做的所有收购，我们所做的所有投资都支持B2B2C模式。 当我们考虑我们投资最多的桶时，因为我们看到了数据和分析，测试和学习形式的最大机会，数据和服务，忠诚度能力是一个强大的关注领域，网络和智能 我们内部和后续构建的所有欺诈和安全安全功能，以及我们可以带到桌面并与其他人合作的结账功能，以确保安全无缝。 因此，这些实际上是三个扩展块 - 垂直扩展，以及我们专注于服务的策略的横向扩展。
So, I want to make sure we open it up to the audience for questions. We have a question up here. I'm sure, there are a lot, but I can try to speak for everybody but we have one here.
所以，我想确保我们向观众展示问题。 我们在这里有一个问题。 我敢肯定，有很多，但我可以尝试为每个人说话，但我们在这里有一个。
Hi. Thanks for taking my question. I just wanted to follow up on the Vyze acquisition, and that was your -- for follow-up questions very helpful as well. Can you just sort of talking about how you think about that sort of evolving, because Vyze traditionally was sort of like a waterfall program, if you talk to some of the merchants who participated in it. But, it seems like you kind of bought it for the technology, and then the goal is to sort of expand it. Can you sort of talk about how that might transpire over time, and have the banks expressed interest in this as opposed to some of the other indirect lending programs that are available to them?
你好。 谢谢你提出我的问题。 我只是想跟进Vyze的收购，这也是你的 - 后续问题非常有用。 您是否可以谈论您如何看待这种演变，因为如果您与参与其中的一些商家交谈，Vyze传统上有点像瀑布计划。 但是，看起来你有点为技术买了它，然后目标是扩大它。 您是否可以谈谈这种情况可能会随着时间的推移而发生，并且银行是否对此表示了兴趣，而不是其他一些可供他们使用的间接贷款计划？
Yes. So, the Vyze acquisition, you're right, is -- was mainly for the technology that it offered. And so, what we're hearing from the merchant community is, what they really like about point-of-sale financing is the ability to offer customers choice. So, there might be five different ways to provide financing. The consumer has to drive, which -- what their preference is and which route they're going to take. And each consumer is unique and different in what they need and what their credit worthiness looks like. So, the idea is for Mastercard to be able to provide a gating option to multiple avenues of financing. And we think we're really well-positioned to do that, because of the thousands of financial institutions that we have access to and relationships with. And on the merchant side, we understand their point-of-sale and how to integrate. And then, oh, by the way, we have a gateway capability that we can plug and play this into as well. So, it's --- for us, it’s extending the capabilities that already exist, and going beyond that with value added services that we can tack on top, including potentially providing a gating feature from multiple avenues of financing for a consumer.
是。因此，收购Vyze，你是对的 - 主要是因为它提供的技术。因此，我们从商家社区获得的信息是，他们对销售点融资的真正喜爱是为客户提供选择的能力。因此，可能有五种不同的方式来提供融资。消费者必须开车，这是他们的偏好，以及他们将采取的路线。每个消费者都是独一无二的，他们需要什么，他们的信誉是什么样的。因此，万事达卡的想法是能够为多种融资途径提供门控选项。我们认为我们已经做好了准备，因为我们有成千上万的金融机构可以访问和建立关系。在商家方面，我们了解他们的销售点以及如何整合。然后，哦，顺便说一句，我们有一个网关功能，我们可以插入和播放它。因此，对于我们来说，它正在扩展已经存在的功能，并且超越了我们可以追求的增值服务，包括可能为消费者提供多种融资途径的门控功能。
Is there any specific industry verticals that you would kind of target first?
We're looking across the board. As I said, it's not financing, is not limited to large ticket items anymore. So, of course, you think about electronics and jewelry and high ticket, but the sky's the limit with respect to who would be interested.
我们正在全面看待。 正如我所说，它不是融资，不仅限于大件物品。 所以，当然，你会考虑电子产品和珠宝以及高价，但天空是关于谁会感兴趣的极限。
Thank you. So, I mean, I think this is an interesting area. Like when you look especially for some of the dynamics that have developed in the credit market, generally, we were -- we've published a report I guess, yesterday that surveyed Gen Y and Gen Z, and some of the developments that are happening as they start to move through college and into the professional workforce, et cetera. And their circumstances in some ways around credit are different than they were a generation ago. And so, with that, you've seen the rise of point-of-sale financing as alternative, like you said, even for smaller ticket items and like. So, I get Mastercard’s ability to serve as a gateway. And that's an important part of our conversation nowadays. But what happens when you own something like Vyze in terms of your ability to be a compelling gateway for other potential partners firstly? And secondly, one of the challenges always seems to be that if you're going to do point-of-sale financing et cetera, there almost always is some sort of direct relationship with the merchant itself. So, how does Mastercard help manage through that kind of mishmash of different relationships to be sure that you’re able to deliver the best -- basically the best solution to everybody possible.
谢谢。所以，我的意思是，我认为这是一个有趣的领域。就像你特别关注信贷市场发展的一些动态一样，我们通常是 - 我们发布了一份报告，我猜，昨天调查了Y世代和Z世代，以及一些正在发生的事态发展当他们开始进入大学并进入专业人员队伍时，等等。他们在某种程度上围绕信贷的情况与一代人不同。因此，您已经看到销售点融资的增加作为替代方案，就像您说的那样，即使对于较小的票据等也是如此。所以，我获得万事达卡作为网关的能力。这是我们现在谈话的重要部分。但是，当你拥有像Vyze这样的东西时，你能够首先成为其他潜在合作伙伴的强大门户，会发生什么？其次，其中一个挑战似乎是，如果您要进行销售点融资等，那么几乎总是与商家本身存在某种直接关系。那么，万事达卡如何通过这种不同关系的混搭来帮助管理，以确保您能够提供最好的 - 基本上是每个人可能的最佳解决方案。
So, it's different go to market approach. So, as I mentioned, we already have established relationships with most of the large merchants in the U.S., so we can go direct to them and establish a partnership with them. For the long tail, we have established relationships with acquirers, who support millions of small and medium sized businesses and would love to provide white label services like this to those merchants. And then, we have relationships with the thousands of FIs who are either already in the space or looking to get into the space. So, it kind of -- it satisfies so many needs of our customers at the same time, our ability to connect the dots and be -- fit in the middle and be that gating feature. It's what we do best, managing a franchise, creating rules, creating an infrastructure and a community that everybody can coexist in. So, it really -- while it's not payments in the true definition of payments, it's an extension of our role in the payments value chain.
因此，市场方法不同。 因此，正如我所提到的，我们已经与美国的大多数大商家建立了关系，因此我们可以直接与他们建立合作伙伴关系。 长尾，我们与收购者建立了关系，他们支持数百万中小型企业，并希望为这些商家提供这样的白标服务。 然后，我们与成千上万的金融机构建立了关系，这些金融机构已经在这个空间或者想要进入这个领域。 所以，它有点 - 它同时满足了我们客户的许多需求，我们连接点的能力，适合中间和门控功能。 这是我们最擅长的，管理特许经营权，创建规则，创建基础设施和每个人都可以共存的社区。所以，它确实 - 虽然它不是付款的真正定义，但它是我们在 支付价值链。
And is it -- like a lot of times on some of these point-of-sale, it’s being paid for via basically a change in interchange rates at the merchant level, at least in some cases where the merchant maybe is paying a higher level. Does that ripple through that rule set that you described or that you alluded to, as it relates to other parts of acceptance, or not, like you just got layered on top on top…
它是 - 就像这些销售点上的很多次一样，它通过商家层面的交换率基本上的变化来支付，至少在商家可能支付更高水平的某些情况下。 这是否会影响你所描述或你提到的规则集，因为它与其他接受部分有关，或者不是，就像你刚刚在顶部分层一样......
Yes. Point-of-sale financing is very separate from payments and the ecosystem that exists around payments. So, I would look at them as two separate things.
是。 销售点融资与支付和支付周围的生态系统非常分开。 所以，我会把它们视为两个不同的东西。
Two separate things. Got it. So, hard to have a conversation, particularly in the U.S. on payments without talking about the M&A activity this year. And we've seen, obviously, three big ones. Once that ball got rolling, it seemed fairly predictable, so, maybe after January, it hasn't been that much of a surprise. But, can you comment a little bit on how you see that M&A activity impacting the landscape generally, like what -- like where does that impact MasterCard? And you -- are you changing the potential risk of on us type a model developing where they can build effectively large closed loops or what -- how do you think about navigating the changing landscape?
两件事。 得到它了。 因此，很难进行对话，特别是在美国，在没有谈及今年并购活动的情况下付款。 而且我们已经看到了三个大的。 一旦球开始滚动，它似乎是相当可预测的，所以，也许在一月之后，它并没有那么多意外。 但是，你能否对你如何看待并购活动对整体情况的影响作出一点评论，比如什么 - 比如影响万事达卡的哪些方面？ 而你 - 你是否正在改变我们打造一个模型的潜在风险，他们可以在哪里建立有效的大型闭环，或者你如何看待导航不断变化的景观？
So, the payments landscape on the assessment side with acquirers, and issuer processors, it's the most complicated, fragmented landscape in the U.S. and really any other market around the globe. And so, these announcements are really efforts by the acquiring community and issuer processor community to combine their skills and their capabilities to provide end to end solutions to their customers. So, they too are differentiating on services, they too are trying to optimize relationships in one side of the house with the other side of the house. They're looking for expense synergies; they're looking for revenue opportunities, just like any other good acquisition would. And from our perspective, we're working with all these partners today, we have been in various capacities for many, many years already on the acquiring side, on the issuer processor side, we -- our business with them is extensive and BAU at the moment.
From our perspective, we'll see how it plays out, but we're in a really good spot to help them in these transitions, because of all the things I've already said. We have value added products and solutions that they might want to look to white label or partner with us to extend those services to their customers. We want -- we might be able to help them get to market more quickly to help differentiate them. So, there's lots of conversations that we're having at executive levels of those organizations. And we'll see how it plays out. As far as beyond us, it's been tried before in our market, it's very difficult to accomplish. And so, we'll wait and see. But we see MasterCard playing very critical role in the transition of these organizations. And we believe we're poised to put our partnership on...
So, you made an interesting point is that the consolidation in the U.S. market, in some ways, really just starts to make the U.S. market look a little bit more like other markets around the world, particularly from a concentration perspective, et cetera. What about taking the next step, is it like -- does it make sense for these merchant acquirers to start to be way more cross-border and activity and frankly, start to have more of a footprint that’s akin to Mastercard’s global footprint?
I think that's one output that they are looking to achieve when you look at some of the FinTechs who’ve been a little bit more nimble with respect to their global growth, that might be one objective that they are looking to accomplish in the context of these integrations. I'd say, the best acquirer is the one that can offer full service capabilities to the partners. A merchant doesn't like to have multiple relationships if they can avoid it, they like things to be integrated, they like things to be streamlined.
So just these movements allow them to be more powerful, and again, leverage partnerships in one side of house on the other and vice versa. And certainly, global growth -- I mean, Worldpay is one of the largest global acquirers already, global payments, same thing. So, they're already focused on global growth, I think this just amplifies that.
我认为，当你看到一些在全球增长方面更加灵活的金融科技公司时，他们希望实现这一目标，这可能是他们希望在以下背景下实现的一个目标。 这些集成。 我会说，最好的收购者是能够为合作伙伴提供全面服务的人。 商人不喜欢有多种关系，如果他们可以避免它，他们喜欢要整合的东西，他们喜欢简化的事情。
因此，只有这些运动才能使它们变得更强大，并再次利用房屋一侧的合作伙伴关系，反之亦然。 当然，全球增长 - 我的意思是，Worldpay已经是全球最大的收购者之一，全球支付，同样的事情。 所以，他们已经专注于全球增长，我认为这只会放大这一点。
They're quite large, though among the largest global but their overall share of the global is still really small. And so, how do they continue to move that forward, for sure, is an ongoing question? And then, we published a report a couple weeks ago on, we called globalization, just talking about how different dynamics may be slowing the globalization of the economies generally. And one of the things that we noted as it relates to payments is that there is -- seems to be -- this isn't new, but there's been this ongoing interest and at least national schemes and countries having sponsoring their own opportunities and payments. So, for Mastercard and the relationships that you're in charge of, like merchants, and I know you're operating in the U.S., but when you have your conversations with your international counterparts like what's that conversation, like in terms of the back and forth of maybe help that they're looking for? Like, okay, what's the role that Mastercard can still play, and in places where there is some preference for domestic schemes?
它们规模很大，虽然是全球最大的，但它们在全球的份额仍然很小。那么，他们如何继续推动这一进程，当然，这是一个持续的问题？然后，我们在几周前发表了一份报告，我们称之为全球化，只谈论不同的动态可能会减缓整体经济的全球化。我们注意到与支付有关的事情之一就是 - 似乎 - 这不是新的，但是这种持续的兴趣，至少是国家计划和国家赞助自己的机会和付款。所以，对于万事达卡和你负责的关系，比如商家，我知道你在美国经营，但是当你和国际同行谈话时，就像那次谈话一样，就像回来一样他们正在寻找可能有帮助的人吗？好吧，万事达卡仍可以扮演什么样的角色，以及哪些地方偏爱国内计划？
So, we work with -- in markets where domestics schemes don't allow for kind of broadening of an avenue for Mastercard to say. We are working in every market to see whether processing, if it doesn't exist today, has a space. And obviously, the more transactions we process, the more transactions we see the more value we can bring to our partners and to our own network.
So, it is, from our perspective, we're having multiple conversations with markets outside the U.S., where we don't -- we are not the predominant processor. And to either open up the market or to give us an avenue to play in that market, China's one -- but one example, with just tremendous opportunity to now capture, started showing in a domestic way and start seeing some of those transactions from a brand perspective. They may still control the processing; we can see them from a brand perspective. So, it's a very active part of what we're doing across the globe.
因此，我们合作 - 在国内计划不允许扩大Mastercard的途径的市场中。 我们正在每个市场工作，看看如果今天不存在，加工是否有空间。 显然，我们处理的交易越多，我们看到的交易越多，我们可以为合作伙伴和我们自己的网络带来更多价值。
因此，从我们的角度来看，我们正在与美国以外的市场进行多次对话，我们不会这样做 - 我们不是主要的处理器。 无论是开放市场还是为我们提供在该市场上发挥作用的途径，中国只有一个例子，现在只有巨大的机会捕捉，开始以国内方式展示，并开始看到一些来自 品牌视角。 他们仍然可以控制处理
So, when we talk about activities, there's -- definitely it seems one of the recurring themes within our conversation and through the day has been the investment going towards, trying to develop innovations and payments. What do you see and expect be key emerging technologies or innovations to watch in the payment space over the next few years?
So, I would start by saying tokenization, network tokenization is incredibly important innovation that's being launched as we speak. And the reason it's important is one, because it provides a safe and secure and streamlined way to pay, not only online but also in connected devices. So, your watch, your phone, your piece of jewelry, your shoe, whatever you want to connect to a wireless capability has a potential for commerce and payments. And without tokenization, none of that can actually occur.
So, tokenization has been fundamental to our innovation. And we've embedded it in our checkout, our new checkout capability We've embedded it in with retailers, as they're thinking about new ways to pay in stores. So, many retailers are thinking about how they transform the physical footprint of their store into a more digital, connected, engaging environment for their consumers. And so, that might be offering them the ability to shop in -- on a kiosk, or in at an unattended terminal, or at a pop up shop or giving the ability to for consumers to not have to wait in line, that type of thing, streamlining the checkout process for them. So, again, all of that can happen today because of tokenization. So, really, really important. I’d say, AI of course is another example of where we've invested in a company called criterion where we can actually embed AI capabilities to the -- into the checkout process, into the decisioning process at the point-of-sale. Of course, there's lots of utilities for AI and AI is only as powerful as data and input that goes into it. But we have a ton of data that we can offer to help retailers make integrated decisions about how to do conversational commerce, for example, either in the digital in your app or in the digital space, again, to create a digital environment that’s your physical environment.
因此，标记化是我们创新的基础。我们已经将它嵌入到我们的结账中，我们的新结账功能我们已经将它嵌入零售商，因为他们正在考虑在商店中支付新的支付方式。因此，许多零售商正在考虑如何将其商店的实体足迹转变为为消费者提供更加数字化，互联互通的环境。因此，这可能会为他们提供购物的能力 - 在售货亭，无人看管的终端，或在弹出的商店购物，或者让消费者不必排队等候，事情，简化他们的结账过程。因此，再次，所有这一切都可能因为标记化而发生。所以，真的非常重要。我要说的是，人工智能当然是我们投资于一家名为标准的公司的另一个例子，我们可以实际将AI功能嵌入到结账流程中，进入销售点的决策流程。当然，人工智能和人工智能有很多实用工具，只有数据和输入功能强大。但是，我们可以提供大量数据来帮助零售商做出有关如何进行会话式商务的综合决策，例如，在应用程序中的数字化或数字空间中，再创建一个与您的实际相关的数字环境环境。
So, I guess, I was just going to ask is like one innovation that seems to the U.S. for typical, maybe that has lagged a little bit is on contactless. I was in Australia last week, and I don't have contactless card, and it’s like giving people -- is like giving my kids a rotary phone. And it is amazing like so quickly they’ve forgotten in the taxi and in the restaurants like how to process it. Right? And so, from your perspective how important is contactless is for the U.S.? And can that be -- I mean, I certainly feel like it's an incremental driver that's nice for adoption and shift. But can it inflect the pace of adoption at all or shift to electronic from cash? How are you thinking about that interface, specifically, in the U.S. market, based on what you've seen in other markets?
所以，我想，我只是想问一下，这似乎是美国典型的一种创新，也许这种创新落后于非接触式。 上周我在澳大利亚，我没有非接触式卡，这就像给人一样 - 就像给我的孩子一个旋转手机。 他们很快就忘记了出租车和餐馆就像是如何处理它一样令人惊奇。 对？ 因此，从您的角度来看，非接触式对美国有多重要？ 这可能是 - 我的意思是，我当然觉得这是一个增量驱动器，对采用和转换很好。 但是，它能否改变采用的步伐，还是转向电子现金？ 您是如何根据您在其他市场看到的内容，特别是在美国市场中考虑该界面的？
We're excited about the potential for contactless to take hold in the U.S. And we do think we're at an inflection point for adoption for a couple of reasons. One is, three, almost four years ago now when merchants upgraded their terminals for EMV capability. They also naturally acquired the ability to conduct NFC transactions. And so, 60% of the market is EMV enabled, 60% of the volume that -- our volume is happening at contactlessly enabled merchants today for the acceptance side. Typically when you introduce a new product in the market, you have a chicken and egg game. You need partners that accept and you need partners that will issue. And then, you need a consumer val prop to actually drive meaningful change.
So, we have the acceptance. On the issuing side, we have commitments from issuers that represent two thirds of our volume to issue by the end of 2020 cards with contactless with capability. And then, on the consumer front, you actually have a real pain point that you're solving. If you look at the transit use case and right here where we're sitting in New York, the MTA just went live with contactless on the 4, 5 and 6 between Union Square and Grand Central. And we've been partnering with their integrator, Cubic, for many years to help drive this launch. We're super excited about it because there's 9 million people that take the MTA in some way, shape or form every day. And the ability to transform their payment experience, closed loop paper-based, non-connected way to something that's digital…
我们对非接触式在美国占有一席之地的可能性感到兴奋。我们认为，由于几个原因，我们正处于收养的拐点。一，三，差不多四年前，当时商家为EMV能力升级其终端。他们自然也获得了进行NFC交易的能力。因此，60％的市场是EMV启用，60％的数量 - 我们的数量发生在今天接触方面的非接触式商家。通常，当您在市场上推出新产品时，您将拥有鸡蛋和鸡蛋游戏。您需要接受的合作伙伴，并且您需要合作伙伴才能发布。然后，您需要一个消费者val prop来实际推动有意义的变革。
Yes, so, my cards can stop expiring, right?
Well, and you can -- if you lose it, you don't have to wait at the kiosk to reload. Everything that you do with your transit, payment can be digitized now and actually leveraged at the subway turnstile. So, those cues that we all face and the person in front of you that's not doing it right, that you want to scream at, it'll all be alleviated now, because of the MTA. So, what we've seen in other markets like London, where the tube went live, and 50% of those transactions on the tube are happening in a contactless way, or in Vancouver, when that went live, took two months to get to 1 million contactless tappers. That drives the rest of the market. And it is an inflection point, and we are there in the U.S. as we speak.
And when it comes to your question, which is, is that going to actually drive business? It does, looking at our studies, in other markets, like you mentioned, Australia, Canada, Poland, these are all markets where contactless is more the norm than the exception. What we're finding is average ticket and spend goes up anywhere between 30% and 80% on average. And so, we're seeing in the U.S. most -- 25% -- $25 or less transactions already 80% of our volume. And so, the ability to actually kick start the contactless energy in transit will have a trickledown effect to other merchants like Dunkin' and 7-Eleven, and Walgreens and Target that have already announced that they've opened up contactless. So, we see it as a great opportunity to convert cash and check, to drive average spend, and to create stickiness with consumers who previously weren't using cards for their taxi or their subway or their coffee to really change behavior.
We actually announced a promotion last Friday with the MTA called Fareback Fridays. And so, this is when you use and if any of you are in New York on Friday, you use your MasterCard to tap at a subway turnstile, MasterCard will refund the fare upto two taps a day. And that's really -- it's for June and July, and it's really to get consumers acclimated with how to tap and of course, drive preference for our brand. We did this in London and it worked really well.
好吧，你可以 - 如果你失去它，你不必在售货亭等待重装。您在运输过程中所做的一切，付款都可以现在数字化，并实际利用地铁十字转门。所以，我们都面对的那些线索以及你面前表现不佳的人，你想要尖叫，由于MTA，它现在都会得到缓解。所以，我们在其他市场看到的，比如伦敦，管道上线，50％的交易是以非接触方式发生的，或者在温哥华，当它上线时，需要两个月的时间才能到达100万个非接触式攻丝机。这推动了市场的其他部分。这是一个转折点，我们说话的时候我们就在美国。
当涉及到你的问题时，那是否会真正推动业务发展？它看着我们的研究，在其他市场，如你所提到的，澳大利亚，加拿大，波兰，这些都是非接触式更为常态而非例外的市场。我们发现平均票价和支出平均上涨30％到80％之间。因此，我们在美国看到的最多 - 25％ - 25美元或更少的交易已经占我们交易量的80％。因此，实际启动非传输能量的能力将对其他商家如Dunkin和7-Eleven以及Walgreens和Target已经宣布他们已经开放非接触式产品产生了涓涓细流效应。因此，我们认为这是一个很好的机会，可以转换现金和支票，推动平均消费，并与以前没有使用出租车或地铁或咖啡用卡真正改变行为的消费者创造粘性。
我们实际上在上周五宣布推广名为Fareback Fridays的MTA。所以，这就是你使用的时候，如果你们中的任何一个人星期五在纽约，你可以使用万事达卡来点击地铁旋转门，万事达卡每天最多可以退票两次。这真的是 - 它适用于6月和7月，而且真正让消费者适应如何利用，当然也会推动对我们品牌的偏好。我们在伦敦这样做了，效果非常好。
No. I definitely got you on that. So, I appreciate it. Unfortunately, we're out of time. But, Linda, thank you so much for wrapping our day here in the FinTech symposium. It's been a great wrap and finale to the day. So, we appreciate you participating and continue the things that the market should love Mastercard more than it already does. So, thank you very much.
不，我肯定能帮到你。 所以，我很感激。 不幸的是，我们没时间了。 但是，琳达，非常感谢你们在FinTech研讨会上结束我们的一天。 这一天是一个伟大的包装和结局。 因此，我们感谢您参与并继续了解市场应该比现在更喜欢Mastercard的东西。 所以，非常感谢你。
Well said. Thank you. Thanks for having me.
说得好。 谢谢。 感谢您的款待。
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