The news: Mastercard launched an account owner verification tool in Europe that uses open banking, per PYMNTS. The solution automates the account ownership verification process to eliminate account opening pain points.
In tandem with this launch, Mastercard also partnered with French credit decisioning specialist Algoan. Algoan will use Mastercard’s open banking connectivity to power its credit scoring products across Europe to deliver faster and more inclusive credit decisions.
The bigger picture: Mastercard is committed to unlocking the benefits of open banking, it said during its 2023 North American Innovation Day.
It’s identified four key use cases: payments, account opening, lending, and small business service.
Why it matters: Mastercard is pushing forward with its aggressive open banking push.
Open banking can expand Mastercard’s consumer and merchant network: Account opening partnerships can make financial services available to more users, and interchange-free A2A payments can attract merchants, for example.
But privacy issues still abound, so Mastercard must manage data with transparent consent to ease regulatory, business, and customer concerns to succeed in this segment.
Dig deeper: To read more about the benefits open banking can bring to payment card networks, check out our “US Payment Card Networks 2022” report.
This article originally appeared in Insider Intelligence's Payments Innovation Briefing—a daily recap of top stories reshaping the payments industry. Subscribe to have more hard-hitting takeaways delivered to your inbox daily.