The new Mastercard Pay Local service will benefit over 2 billion card users in the Asia Pacific (APAC) region by giving them the choice to make card-based payments.
According to an official blog post, the newly launched Mastercard Pay Local is designed to connect consumers and merchants, enabling users to use their digital wallets to make card-based payments. The service enables international travelers and local cardholders to link their credit and debit cards to digital wallets without creating prepaid accounts. This will be an enhanced service since customers can start spending as soon as they link their APAC wallets.
Mastercard Pay Local targets 35 Million Merchants.
Per the press release, Mastercard Pay Local targets a wider market where people use digital wallets for their everyday purchases in areas like Eastern Europe, Latin America, Africa, and the Middle East. Popular APAC wallets such as Indonesia’s DANA, Malaysia’s Touch ‘n Go, Sri Lanka’s LankaPay and Cambodia’s Bakong are among the cards that will leverage Mastercard Local Pay for payments targeting over 35 million merchants.
Commenting on the development, Mastercard executive vice president for products and innovation in the Asia Pacific Region Sandeep Malhotra said that with Mastercard Local Pay, “Locals benefit from new payment options while tourists can use their cards as they do at home, making travel infinitely easier, with one less thing to worry about while on the road.”
Mastercard Pay Local to connect cards with APAC wallets
The newly launched card builds on the provider’s partnerships with leading regional wallet providers like Octopus in Hong Kong and Alipay and Weixin Pay from Mainland China. The existing collaborations have created seamless payment solutions for international travelers who make payments like residents in establishments where Mastercard is accepted.
Moreover, several other APAC wallets, such as GrabPay from Southeast Asia, TrueMoney from Thailand, ShopBack from Singapore, and Maya from the Philippines, are already linked with Mastercard. The card issuer recently announced the expansion of the company’s US Installments Program to facilitate greater flexibility for users at checkout. The firm stated then it was keen on introducing the “Mastercard Pay Local to connect cards with APAC wallets.”
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Increase in the Use of Digital Wallets by Consumers
The launch of Mastercard Pay Local comes at a time when research shows an increase in consumers’ use of digital wallets. A recent intelligent report showing how faster payments could promote travel and hospitality found that up to 75% of travelers believed that digital wallets would improve their experience. According to the report, affluent and millennial travelers polled 82% and 83$, respectively, on their use of digital wallets.
The study further found that customers using APAC wallets spent at least $44 on average in restaurants compared to the $33 average for those using traditional payment methods. The study’s authors concluded that the trend reflected “a broader consumer preference for seamless, efficient payment solutions that enhance the overall travel experience.” A similar survey conducted in the United States, the United Kingdom, Brazil, France, and Germany, where the use of digital cards has taken root, showed that over 86% of consumers were familiar with them.
Many respondents were using digital cards and needed to learn what they were and their potential. For example, the study found that about 6.5% of Gen Z users needed help differentiating between cards such as APAC wallets and their related apps. The report’s authors noted that providers who would make a difference required “to differentiate themselves need to recognize how consumers understand these apps to best position their product.”
Conclusion
The introduction of Mastercard Pay Local, which enables users to connect their credit and debit cards to local digital wallets, comes just ahead of the upcoming Singapore Fintech Festival. The development is expected to address the increasing need for seamless payments by international travelers and local users alike. The aim is to enable people to shop easily at locations that accept digital APAC wallets without the need to set up a separate wallet.
The new Mastercard service is set to benefit different stakeholders, including micro, small, and medium enterprises that don’t yet accept traditional card payments. By focusing on inclusivity, Mastercard aims to bridge the gap between businesses, individuals, and financial institutions in over 210 countries globally.
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