Press Centre

MasterCard in Deal to Develop Custom-Use Cards

David Breitkopf
American Banker
Tuesday, September 11, 2007

MasterCard Inc. is working with the Irish payments technology vendor Orbiscom Inc. to introduce several security and processing capabilities.

The Purchase, N.Y., credit card company announced the deal Monday and said the two companies plan to jointly develop a payments processing platform that would let issuing banks quickly develop and offer various new types of cards and services.

MasterCard said it plans to incorporate Orbiscom's technology into its own systems and will operate the processing platform, which it expects to go live next quarter using the name inControl.

Steve Abrams, MasterCard's global group executive for commercial products, said in an interview Monday that inControl will support commercial and consumer cards, as well as mobile payments technologies.

"We're going to be delivering not just the off-the-shelf current products that Orbiscom has to offer but [also] future products and products specifically customized for our issuers," he said. "It will give our issuers a much less expensive start, more flexibility, and & quick[ness] to market compared to what they would go through today in terms of trying to deal with their own internal systems."

Gary Lyons, the chief executive of Orbiscom in Dublin, said during the joint interview that inControl would let issuers and customers control the types of merchants at which their cards may be used, set spending limits, and even place restrictions on the time of day the cards may be used.

"For example, you could say, 'I want a card that's only good in a particular geography, only good to be used Monday through Friday, only used at a particular set of merchants, and denying certain merchant category codes.' For example, you wouldn't want to give your kid access to a credit line that they can use for gaming," Mr. Lyons said.

Mr. Abrams said that a key feature will be Orbiscom's one-time-use card number technology, which other card companies already use to add security by creating a transaction number for online purchases. This lets cardholders avoid sending their actual account numbers across the Internet.

Mr. Lyons said, "The one-time-use number is a feature that lends itself very well to the Internet and, indeed, corporate payments because the unique number acts as a unique transaction identifier."

He added that other security measures will be used for transactions at merchant sites. "In the case of the physical world it's typically going to be the controls rather than the one-time-use number that are going to be adding value to the product," he said.

InControl will also feature instant issuance, Mr. Abrams said, which could help issuers win customers, especially over the Internet. Customers who are solicited on Web sites may be interested enough to fill out an application but may lose interest in the card as they wait for it to arrive in the mail, he said.

"But here you have an opportunity to have instant issuance on the Internet," he said. "You can make them an offer and give them either a one-time-use" or a limited-use account number, "until the plastic is received by that particular individual. So that individual can immediately utilize that account."

Gwenn Bezard, a research director at Aite Group LLC in Boston, said that issuers would be interested in the technology, which would let them "easily set up parameters" for the card's use.

"It's a very intriguing deal," he said, for "what it says about where the card networks are headed. I think they're headed ultimately toward multipurse cards, using one piece of plastic and having different products attached to that card. So there is one piece of plastic in your wallet, but it can do far more."