Mastercard, PayPal Talks to Share Transaction Data
Less than two weeks after PayPal announced a strategic partnership with Visa, the digital payments provider is talking with Mastercard about ending a long-running dispute over transaction data, Mastercard’s CEO says. During an earnings call last week, Mastercard CEO Ajay Banga said the payments network was engaged in a “constructive dialogue” with PayPal over Mastercard’s concerns about being shut out from merchant and transaction data for sales made via “staged” digital and mobile wallets such as PayPal and Google Wallet.
In 2013, Mastercard began requiring operators of such wallets to pay a fee for transactions made with Mastercard-branded payment cards unless they began sharing more specific transaction data with the payments network. Although Banga didn’t go into specifics, he said that while Mastercard’s position in data sharing hadn’t changed, Pay Pal was “working to resolve some of those concerns we all had around the lack of transparency around these staged wallets.” Should the companies work out an arrangement for sharing transaction data, the fee would go away, Banga said, adding that the fee was not meant to force wallet providers to change their policies, but rather “to manage through all the difficulties that their policies were creating in terms of data and transaction management.”
It wasn’t clear from Banga’s comments whether the discussions between the companies covered PayPal’s policies around encouraging its users to link their PayPal accounts directly to their bank accounts via ACH. Those policies were at the heart of PayPal’s recent pact with Visa, under which PayPal and Venmo will stop steering customers to ACH as the preferred payment type. In return, PayPal gained access to Visa’s tokenization program, expanding in-store acceptance of PayPal to all physical retail locations where Visa contactless payments are enabled. Citing the deal as another sign that PayPal is trying to work with the larger payments industry, Banga said such cooperation would be a net benefit for all parties involved.