Mastercard Isn’t Just a Credit Card Company, According to its CEO

January 13, 2020, 2:11 PM UTC

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Many companies claim, in a trite sort of way, to be technology companies. They do this because tech earns a higher valuation and because, at least in an aspirational sense, they believe the technology behind their businesses is their secret sauce.

Few of these companies would be willing to repeat their claim in their securities filings, where it’s easy to be verbose and redundant but extremely difficult to fib. Not so for Mastercard, which most people think of as a credit card company. Here’s how the company describes itself: “Mastercard is a technology company in the global payments industry that connects consumers, financial institutions, merchants, governments, digital partners, businesses and other organizations worldwide, enabling them to use electronic forms of payment instead of cash and checks.”

Last week in San Francisco, I met with Ajay Banga, the long-tenured CEO of Mastercard. He genuinely believes “cash and checks” are the competition and what accounts for his company, once owned by banks, being worth more than $300 billion today. About 85% of the world’s transactions are still in cash, says Banga. He likens his company’s core technology to a railroad that’s willing to put any sort of “freight” on its tracks, so long as the purpose is moving money legally. “We are the rails of the railroad,” he says. “Trains can have different models.”

Banga rarely mentions cards, the ubiquitous pieces of plastic issued by his banking customers. The banks deal with consumers and pay Mastercard for the branding and the moving around of money. Banga wants Mastercard’s technology in as many places as he can get it, card or no card. This includes the digital wallets of tech giants like Apple, which co-issues a credit card with Goldman Sachs using Mastercard’s “rails.” (Banga visited Apple last week too; he wouldn’t say who he saw or what he discussed.)

Mastercard is a rare cross-generational success. (Its rival Visa has done well too; both once were owned by banks.) It also gets more than a quarter of its revenues from services like cybercrime consulting. And while the banks have let their Mastercard ownership dwindle to a 2% stake, the independent foundation endowed by Mastercard’s stock has $34 billion in assets and focuses its efforts on jobs in Africa.


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Adam Lashinsky

Twitter: @adamlashinsky


This edition of Data Sheet was curated by Aaron Pressman.


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The New York Public Library system has been going strong for 125 years. On Monday, the library released a list of the top 10 most checked out books in its history. Along with famed tomes by Harper Lee and Dale Carnegie, you'll also find a British author's more recent story of a boy's magical adventures. And, no spoilers, but I've been reading the #1 ranked book since I was a toddler.

Aaron Pressman

On Twitter: @ampressman


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