Mastercard restructures its business structure, New York Fed joins cross-border test | Payment sources

Under increasing pressure to develop new revenue streams amid a changing payments ecosystem, Mastercard on Tuesday announced that it will realign its organizational structure into three distinct business areas starting May 1, with immediate changes in key executives. announced plans to take effect.

Mastercard's core businesses, credit and debit card acceptance and transaction processing, and support for instant payments, will be combined into one unit, while the card network's fast-growing offerings, including value-added services and new payment flows, will be integrated into two units. housed in two separate units. unit, according to a press release.

Mastercard CEO Michael Miebach said in a release that the move is aimed at diversifying the company's revenue streams and capitalizing on growth opportunities.

In recent quarters, analysts have Mastercard and rival global card network Visa aim to diversify revenue sources In addition to competition from providers offering faster payments, open banking and account-to-account transfers, credit and debit exchanges are facing downward pressure. Mastercard's 2023 net revenue from value-added services (including anti-fraud and security tools, identity and authentication, data analytics and consulting, and loyalty solutions) increased by 10% compared to a 10% increase in net revenue from payments. Increased by 18%.

The changes could help Mastercard's mission to squeeze more revenue from emerging products, but JPMorgan Chase analysts said in a note to investors this week that the Comparisons in these areas could become even tougher due to Mastercard's strong performance in value-added services, he said. When Mastercard releases its latest quarterly results on May 1st.

As part of the restructuring, Mastercard has appointed Joan Lambert, a 22-year veteran of the company, as chief product officer and head of its core payments division. Mr. Lambert previously served as Mastercard's chief digital officer.

Raj Seshadri joined Mastercard in 2016 after stints at BlackRock and Citigroup. He will oversee new payment flow areas. His Mastercard says it includes remittances, payments, and intercompany payables and receivables. Previously, he served as President of Data and Services.

The third division, simply called Services, will be led by Craig Vosburg, whom Mastercard has named chief services officer, and will integrate Mastercard's thriving value-add services, including fraud monitoring tools, cyber and intelligence, data, and open banking. Cover. Mr. Vosburg has been with Mastercard for 18 years and previously served as Mastercard's chief product officer.

Mr. Vosburg will also oversee the Data and AI organization, a new group led by Greg Ulrich as chief AI and data officer and focused on commercializing AI and data for internal and external use. Become.

Mastercard's president of cyber intelligence, Ajay Birla, is retiring after more than 30 years with the company. —Kate Fitzgerald