MasterCard Forms E-Commerce Agreement in China
MasterCard recently announced the creation of a Memorandum of Understanding with Alibaba, an eCommerce giant in China. This mutual agreement will allow both MasterCard and Alibaba to tap further into the eCommerce market and expand their efforts in China.
MasterCard has long been working on its eCommerce growth strategy, with big plans to expand its efforts into the Asia-Pacific. This also gives MasterCard an edge over its competitor, Visa. With Alibaba, the company plans to play a larger role in its payment platforms AliExpress and AliPay, using many of the resources already in place with MasterPass.
Both companies plan to create a more user-friendly experience in eCommerce, as well as create more secure payment solutions for country-to-country transactions. This may bridge the American and Chinese markets so that China can benefit from the merger as well. As Americans become more confident about their money overseas, they may feel better about tapping into Alibaba’s resources.
This is not the only effort that MasterCard has made to build a name in China. Back in 2010, the company signed an MoU with China UnionPay, which is the only bank transaction processor in the area. Last September, the company introduced China’s first dollar-denominated credit card in association with Citibank. Those actions, combined with this recent merger, is expected to yield a 20% growth for MasterCard in the next two years.
There are no reports of when changes will take place, but Alibaba customers can expect to see progress in the years ahead. With MasterCard on hand to promote the development of newer, safer payment options, there is sure to be a transformation in the future.