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MasterCard® PayPass™ Performance Insights MasterCard PayPass Performance Insights reports current performance metrics and general statistics (generated from transactions processed by MasterCard and through case studies created in collaboration with MasterCard issuers); the in-depth reports and analysis generated through these endeavors clearly demonstrate the positive impact PayPass delivers to our customers’ business. |
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As of June 2010, nearly 78 million MasterCard PayPass cards and devices have been issued for use at approximately 245,000 merchant locations worldwide, including new acceptance environments such as vending, taxis, tollbooths and transit. In addition to robust deployments at major merchants in the US such as McDonalds, 7-Eleven, CVS, Duane Reade, Sheetz, Hess, Wegman, The Home Depot, Best Buy, Gulf Oil, Sports Authority, BJ's, Meijer's, Whataburger, Tim Horton's, Shop-Rite and Philadelphia Airport, PayPass has been rolled out in 36 countries. Outside the US, PayPass speeds consumers through the checkout process at such locations as McDonald's (Lebanon and Mexico), Burger King (Turkey), 7-Eleven (Australia), Starbucks (Turkey and Malaysia), Petro-Canada (Canada) Tim Horton's (Canada), Boots (UK), Carrefour, Cora and Intermarche (all 3 in France) and in many other types of merchants including supermarkets, cinemas, gas stations, fast food and transit.
PayPass technology has also proven popular in sports facilities, including football and baseball stadiums and professional golfing events.
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MasterCard PayPass demonstrates an economic benefit to issuers. Cardholders that use their PayPass card make it their preferred card. Clear cardholder communication to teach cardholders how and where to "Tap" their card at participating merchants is a key driver for success. |
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The statistics provided below are based on MasterCard transaction data through 2Q 2010 and case studies conducted with participating PayPass issuing banks.
PayPass expands card usage and becomes the preferred card:
- Cardholders spend more with their PayPass card - [1] Increased overall usage of 36% per PayPass account. Taking the effect of reactivation into account in the issuer case studies analyzed, increases grew between 28%-42%.
- Cardholders use their PayPass card more often - Increased transaction frequency per account by 32%. Taking the effect of reactivation into account in the issuer case studies analyzed, increases grew between 33%-52%.
- Cardholders use PayPass for smaller purchases - Average ticket for PayPass transactions is just over $37; Approximately 56% and 79% are for purchases of $25 and $50 or less respectively, a sign that PayPass is increasingly displacing cash. PayPass expands where cardholders choose to shop for everyday purchases:
- Cardholders use PayPass at merchants that mostly accept cash - Consumers card volume grows because purchases are no longer limited to cash on hand.
- PayPass expands where cardholders use their card - As more consumers carry PayPass, acceptance at new merchants is growing in step. While cash remains a more popular form of payment at these merchant types, PayPass is clearly gaining ground, and fast.
PayPass moves transactions from cash to card:
- Approximately 56% and 79% of PayPass Transactions are under $25 and $50 respectively - $963 billion cash purchases (2008)[2] - that is the global cash displacement opportunity. Consumer preference for PayPass over cash continues to grow the card industry's share of low value payments. |
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New Profitability Opportunities - PayPass contributes to issuers' bottom line and helps differentiate them from their competition. It is also a proven tool to convert inactive accounts. In one issuer case study for example, 15% of active "tappers" were previously inactive. |
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Cardholders that tap with PayPass show the most significant growth - PayPass cardholders showed more significant growth in spend, transaction frequency than other segments of issuers' portfolios.
A MasterCard PayPass case study shows that 30% of the issuer's portfolio of active PayPass cardholders drove 71% of the change in total dollar volume after being reissued with PayPass.
MasterCard sees a direct correlation between portfolio profitability and cardholder awareness of MasterCard PayPass - Following marketing and communications best practices helps maximize PayPass issuers' profitability and shows markedly different results from those that did not. The best practices include:
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Educating Consumers - Communicate simply and often;
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Training - Training the branch staff and call center staff on where and how to use PayPass and distribute FAQs;
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Considering Card Design - Display PayPass prominently on the card front. |
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For more information, please contact your MasterCard Worldwide sales representative or send an email to paypass@mastercard.com [2] Source: DataMonitor Dec 2008 [1] Lift calculations are derived from a subset of PayPass-enabled debit and credit cards that leveraged the PayPass technology [i.e., tapped] in the current month and had observable activity during the same month in the prior year. The lift calculation was modified in Q4 2006 to exclude accounts that were PayPass-enabled in the prior year. Most cardholders were not offered rebates or other incentives to use their PayPass cards during this period, and particular issuer portfolio segments (e.g., inactive accounts) were not targeted for PayPass issuance.
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