Mastercard has joined forces with multiple new global partners to enhance its new Mastercard Installments program, which is expanding in order to support more small businesses in the United States.

Mastercard Installments Buy Now-Pay Later Coming to More Small Businesses

Mastercard are seeking to meet the demand for powerful Buy-Now-Pay-Later (BNPL) schemes, especially with familiar and trusted brands. Their new partners will be providing support for the program, including US-based financial institutions such as Cross River, Live Oak Bank, MOCA Financial and WebBank, as well as others from the UK and Saudi Arabia.

Consumer Protections and Data Transparency

As well as providing more payment options, Mastercard Installments will also focus on responsible lending practices to support consumers with an enhanced set of protections such as data transparency and insight-driven programs for product improvement.

Using technology, data and insights, as well as their wealth of consulting expertise, Mastercard aims to create a ‘more intelligent way’ to provide installment lending at scale.

Banks Respond to Mastercard Installments

The Chief Product Officer at Mastercard, Craig Vosburg, explained: “We believe no matter how you pay, a foundation of strong protections must be in place. Trust is the currency of innovation. Using a Responsible-by-Design approach ensures that we stay ahead of consumer, merchant and bank needs and expectations, continuously building confidence in the payments ecosystem by providing choice at scale.”

Numerous representatives of banking institutions have responded to the news about Mastercard Installments, including Madhu Kejriwal of new partner HSBC, who urged caution saying: “Customer expectations have evolved as the payments landscape has advanced, so banks need to find appropriate solutions. BNPL lies at the intersection of payments and lending; it can provide customers with a seamless payment option. However, it’s important to realize that it’s very much a form of credit. HSBC is fully committed to responsible lending, and providing transparency to customers is of utmost importance to us. We want to clearly position any BNPL payment plan as part of a customer’s approved credit line.” Kejriwal added that the partnership with Mastercard is a crucial element of his organization’s responsible lending strategy, as it will enable HSBC to provide customers with access to trusted payment options, especially in instances where the customer wants to budget for larger purchases with affordable payment plans.

Also lending his voice to support Mastercard Installments was Huntley Garriott, the president of Live Oak Bank, who added: “Live Oak knows small business customers need flexible financial products that provide security, transparency and scalability so they can grow their business at the pace that suits their needs. We are excited to partner with Mastercard to explore lending solutions through the Mastercard Installments program as it allows us to deliver innovative products from a trusted source while aligning with our mission to be America’s small business bank.”

Protections, Mitigated Risk and Analytics

The Mastercard Installments program will improve consumer protections by making lenders agree to follow applicable laws and network guidelines on responsible lending practices and data usage practices. The program will mitigate repayment risks with open banking and AI, and employ cutting-edge insights and analytics to access a detailed set of data dashboards to better understand how their products are performing.

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