Considering youth as stakeholders in financial education and product development is paramount to shaping the future of a cashless generation.  Financial institutions have the opportunity to make a difference for youth, moving beyond just offering a “promotional piggybank”.

Recently, I had the pleasure of being a part of the second annual CYFI Summit organized by Child and Youth Finance International in Istanbul – which brought together youth and senior level participants from governments, financial institutions, NGOs and children’s rights advocates, and academics from over 80 countries.

CYFI Summit 2013: Jennifer Rademaker (MasterCard), Bram Stoffele (CYFI), Eija Hietavuo (UNICEF), Anna Zanghi (MasterCard) – authors of the paper.

My colleague Jennifer Rademaker and I co-authored a discussion paper together with CYFI and the United Nation Children’s Fund (UNICEF) under the direction of MasterCard’s arrangement with Bankers without Borders which outlines an approach for how banks and financial institutions can respect and support children’s rights through financial products and services.

Investing in sound financial education and products for youth is good business for both governments and banks.  Financial institutions can provide safe, secure and responsible financial products and services which can support young people to accumulate capital, send or receive money safely, and take loans to pursue goals such as higher learning, entrepreneurial ventures and increasing assets – and thus improve livelihoods and youth’s overall development.

The SASSA program in South Africa exemplifies how electronic payments can dramatically improve the lives of huge underserved youth populations (15 million recipients in South Africa, of which 6 million are child social welfare receipts) – while at the same time, creating efficiencies and transparency for the government.

We’d love to hear your thoughts and comments on children’s rights and financial products, as well as on the paper itself.

So is it that some people love their airline mileage cards while others complain it is too hard to redeem the rewards for a flight. Some appreciate the convenience of cash-back cards and others like how much value they can squeeze out of their points. Sometimes rewards points can also be like jeans in that, over time, they can fade out, or it is harder to get into them, or both.

Did you know that the first version of a rewards program surfaced in 1896 with the S&H Greenstamps. Who knew trading stamps would be a model for what we call reward programs today! American Airlines AAdvantage miles program followed over three decades ago, revolutionizing the world of travel and hospitality. Then came the first ever credit card rewards program, the AT&T Universal Card.

Given the fast pace of technology and progressive ways of engagement with consumers, you would think these programs would be long forgotten. Au contraire. While some argue the rewards industry is becoming commoditized in some markets, most agree that rewards produce growth. Since the inception of the MasterCard Rewards System in 1997, for example, we have serviced nearly 52 million accounts in 14 countries across the globe.

Financial institutions know the difference rewards make in customer retention, growth and acquisition. Over the last year, MasterCard programs have had more than 1.5 million redemptions and issued over 3 billion points. MasterCard can help level set liability forecasts; craft and execute unique merchant campaigns; with the stability and scale of our global network, matched with innovative collaboration to meet new trends and demands.

In 2013 MasterCard invests significantly in the Rewards platform. A new online customer experience will be introduced with back end Web services, robust reporting engine and Truaxis will be integrated –all enabling the MasterCard Global Loyalty Solutions practice to continue issuing points and rewarding customers for another 16 years and more.

While technology and new channels have evolved over time, we know with assurance that people still love their points.

This is where we come in.

We introduced payment cards in Pakistan in the early 90’s and since then, we have created numerous opportunities for the local populace to reap the benefits of being part of the banked community. Until 2003, there were only 2 million payment cards in the country.  Today, there are 20 million and through a series of industry collaborations, we have played a critical role in escalating these numbers. But, it doesn’t stop there. The growth opportunity is huge.

Only 1% of personal consumption expenditure in Pakistan is spent electronically and in a country with 120 million mobile connections, 10 million branchless banking transactions are made every month, and this statistic is growing by 10% every quarter. Pakistan’s financial institutions recognize the importance of electronic payment solutions for the country’s economic growth and hence they are encouraging its adoption through cards and branchless banking.

Telecom companies have launched exceptional initiatives in recent years, and some of these were recognized at the GSMA Global Mobile Awards 2013 conference in Barcelona as the best SMS-based literacy program and best use of mobile in emergency or humanitarian situations. These initiatives highlight the role that technology can play in improving and even saving lives.

I recently presented the MasterCard Payment gateway (MPG) interoperable model at the Mobile Banking Conference in Karachi, which was very well received by telecom operators, banks, IT companies and especially the regulator. By enabling interoperability amongst these institutions, we are well poised to reach a staggering 180 million people, which will be a major step towards supporting Pakistan’s economic recovery and furthering financial inclusion.

Why are we at MasterCard focusing on this space?  For us, it’s certainly not because it’s the current “bright shiny penny” or the pursuit of innovation for innovation sake.  It’s about understanding consumers and how the emerging digital lifestyle will influence habit and how consumers will buy.  At the center of this new digital lifestyle is the drive by consumers to be connected “24/7″ and to have access to insights before, during and after they buy in both the physical and digital worlds.

These insights led to our introduction of MasterPass this past February.  We see MasterPass as the future of digital payments — allowing you to shop and make a payment on your phone, tablet, PC or in a store with one simple experience.  This future is a reality now with MasterPass live in Australia, Canada and the U.S.

This week, we’re happy to announce that BK® Delivers, the BURGER KING® brand’s delivery program, LivingSocial and Rakuten.com Shopping join the growing roster of merchants that accept MasterPass in the U.S.  We’re up to 170+ merchants that are live in the U.S. since MasterPass was announced in February.  We know consumers simply want to purchase the items or services they want, and don’t want to worry about the payments.  That’s the promise of MasterPass and what we’re working with merchants and issuers to deliver each day.

Keep watching this space for additional updates.  In the meantime, we want to hear about your experiences with MasterPass and if there are certain partners you’d like to see offer this service.

 Thanks to all of our voters. 64% planned on buying flowers for mom on Florist Friday.  

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In our special Morning Brew we revealed that in week leading up to Mother’s Day, it’s two days before that tends to be the busiest for U.S. florists – hence “Florist Friday”.

Last year, MasterCard (credit and debit) use the Friday before Mother’s Day totaled over $20 million – this is 35% over the average day in the weeks leading up to Mother’s Day.

So we want to know, will you be buying flowers for mom this Friday, May 10? (I know I am!)

Take our poll and leave us a comment telling us how you are celebrating mom this year. Happy Mother’s Day to all the moms out there!

Starting today, when you join the Fuel Rewards Network™ (FRN) program, a free loyalty program, and link  your MasterCard card, you can save even more money on gasoline for purchases made from participating grocery stores, restaurants, online merchants and Shell convenience stores. (Existing FRN Members need only to add their MasterCard Cards to their accounts to take advantage of additional savings). Shop, dine and watch the price roll down at the pump when you use your FRN card at participating Shell gas stations.

For example, using your MasterCard card with the FRN program for a $100 grocery purchase at Winn-Dixie or Save Mart could save you as much as 13 cents per gallon on gasoline. A $50 dinner tab could result in a one-time bonus of 5 cents per gallon, in addition to the usual 10 cents per gallon for dining.  Now, can you do that with cash?

MasterCard strives to give cardholders unique experiences and value that goes beyond transactions. Tell everyone what you are saving for or what you did with your savings on Facebook, Twitter, Instagram and Pinterest by tagging your stories with the hashtag #FuelFamilyFun.

We’ll see you at the pump. And then, at the beach.

At MasterCard we’ve been listening closely to our customers, our partners and our cardholders.  Over the past six months, 125,000 people created unique content or commentary about MasterCard, stimulating 520,000 social media conversations, with a potential reach of 1.3 billion people.  We’re doing this everyday across 43 markets and 26 languages in real time. And while that may seem like a lot to absorb, what’s  compelling is what we do with all the insights we derive from social listening and how it helps to inform our world beyond cash vision.

Exactly one year ago we set out to listen, engage and analyze what our customers, partners and competitors were saying about us. We did this by developing, in partnership with PRIME Research, a real-time social listening and analytics tool housed in dedicated Conversation Suites in our Purchase, NY headquarters and regional offices.

From mobile payments to the shift to EMV, to conversations about fraud and security, cross functional teams within MasterCard globally are engaged in purposeful listening which is helping to inform business decisions.  Conversation Suite data and insights aid in execution of real-time communications– whether in identifying and responding to an issue via @AskMasterCard or Leveraging insights to help inform new product launches like MasterPass.

Check out our latest video to experience the Conversation Suite for yourself and let us know what you think. Or better yet, Tweet us @MasterCardNews or leave a comment here and tell us what your company is doing to embrace social listening and open, collaborative environments.

Those numbers give a good sense of where MasterCard is today, but they only begin to tell the story of how we’re driving a World Beyond Cash. If you’re a regular reader of this blog, you know this is an issue we are passionate about. I hope you saw the news on MasterPass that came out of Mobile World Congress. It’s the future of payments at MasterCard, providing a seamless, secure and speedy checkout regardless of where or how you’re shopping. MasterPass is available in Australia, Canada and the U.S. with more markets later this year.

It’s been a busy start to the year. From a personal standpoint, I had the opportunity to visit many of our offices around the world including trips to Brazil, Mexico, Dubai and several offices in Asia.  I always look forward to these trips, because not only do I get a chance to work directly with our teams around the world, but I get great insights into the payments landscape of a country through discussions with customers, merchants, telcos, and others, including government officials.

In Asia, I met a number of customers to hear how we can make our products and solutions even better.  In March, we signed an MOU with the Alibaba Group, Asia’s largest e-Commerce company. We also teamed up with Rakuten, Japan’s largest e-Commerce site, to provide their cardholders with virtual MasterCard prepaid cards for online shopping. Both are examples of great e-Commerce solutions that help drive cross-border traffic and increase our presence in Asia.

It was great to visit Dubai and get an update from our Middle East and Africa team. There’s a lot happening in those emerging markets, as evidenced by all the news coming out of our CEO’s visit earlier this year.  I was also pleased with our team’s work, especially in the recent deal with South Africa’s Nedbank shifting their business from a competitor.

Across the world, MasterCard continues to invest in initiatives that position our company for future growth. Our focus is clear: to drive the conversion of cash to electronic payments through technology and partnerships around the world in a secure and smart way.

It’s a good thing that governments and businesses around the world are driving greater access to financial products and services. However, for these tools to become real stepping stones towards sustainable economic empowerment, this access needs to translate into regular usage.

There are different opinions about how to best cover this “last mile.” In my view, electronic payments addressing the most basic needs like paying a bill or transferring money from one person to another are the best on-ramp leading to greater financial inclusion.

In a recent paper we introduced the concept of a hierarchy of financial needs – and the assumptions are very straightforward:

• Individuals are likely to be more concerned about addressing their basic needs first and more receptive to solutions that address these needs
• By serving an individual’s need in the order defined by the hierarchy, more of these needs can be met

Let me give you an example: if consumers’ bill payments can be documented by virtue of being electronic, that information can be used to assess their risk and extend loans to them. If people get credit, they will have greater opportunity to create wealth and invest or save, which in turn will make them think about and enable them taking insurance against negative events.

In this sense, having access to a secure account for holding funds – be it a bank account, mobile money account or prepaid account – is an important first step. But it’s what this account enables an individual to do that creates true empowerment and inclusion.

Top 50 Companies for Diversity

We are proud of the fact that our products and services help engender financial inclusion by allowing individuals who might otherwise be excluded to participate in the global economy. But we also understand that inclusion starts at home. As leaders, we seek people with a broad range of backgrounds and experiences to join our ranks and encourage participation at every level. Our employees know that our culture of inclusion is what gives us insight into the marketplace and what fuels innovation so we can serve our customers better.

Diversity is everyone’s business at MasterCard. There is no doubt that our diversity and inclusion vision – a global and collaborative culture that drives talent development, innovation and results – is critical to helping us achieve a world beyond cash.

According to a Business Travel News Survey, 63% of travel buyers identify mobile solutions in travel in need of urgent improvement.

Our new Smart Data Mobile App for iOS, Android, and Blackberry allows corporate cardholders to upload receipt images directly to the smartdata.gen2 expense reporting system—just by taking a picture of it with their smartphone. It means you can keep the receipt that you need, but toss the wasteful paper. Since Smart Data is a cloud-based app, users can capture and upload their receipts anytime, anywhere.  Just snap the picture, enter a little bit of data and it’s automatically uploaded and waiting for you with the rest of your expense data. 

According to a study in 2012, 80% of business travelers claim filing expense reports at the end of a trip increased their stress levels.

Corporate MasterCard holders who use SmartData can have up to 100% of their transactions auto-populated in their expense report.   

In a life full of clutter, the Smart Data Mobile App saves time, helps cardholders stay up to date and eliminates paper. And a little less paper can go a long way to making our Commercial users happy.

It is well documented that in developing countries around the world, there are millions of rural poor who live on irregular incomes without access to credit. However, advances in payment technology such as prepaid or “pay as you go” and mobile money, are opening up business models that allow innovative financing for these underserved communities.

A research paper for the upcoming (May 2-3) Extreme Inclusion conference at The Fletcher School (“Prepaid and Pay-As-you-Go Models for Asset Financing”), looks at two experiments in Kenya, where mobile money is prevalent:

1) A layaway program for Kickstart pedal irrigation pumps (with no remote shut-off). After a 15-20% deposit, payments on the remainder of the purchase price can be made at any time, in any amount—in effect, a form of targeted savings through micro mobile-money payments.

2) A pay-as-you-go program for M-KOPA solar panels and lamps (with a remote shut-off). After a 15-20% down payment, customers can take the panels home, and pay them off over a year (if needed)—and enjoy the advantage of solar electricity before they own the panels outright.

Both experiments are in the early stages, with continuous changes to the model based on customer behavior and feedback. Nonetheless, it’s clear that the pay-as-you-go business model allows the flexibility that consumers on irregular incomes require. Mobile money and SIM-shutoffs allow for automatic management, with no need for vendor billing or customers standing in line to pay with cash.

Mobile-money payment systems give sellers and lenders the ability to accept an infinite number of micro-payments on a pay-as-you-go basis, which is impractical with cash. Those payments can be targeted to savings (layaway) for a high-ticket item, or applied to ongoing usage of goods and services until the money runs out.

As with mobile phones, the prepaid or pay-as-you-go technique works best with electronic products that can be remotely monitored and shut off through a SIM card when the money runs out or payments lag. To date, the model has been used primarily with services like mobile airtime—such as electricity, satellite broadband, or cable TV. But now, through experiments like Kickstart and M-KOPA, we are seeing the model expand to include durable goods.

With refinements for different populations and locals, the pay-as-you-go business model could potentially be extended to a wide range of electronic goods, including radios, TVs and refrigerators. And, because of the ease of making payments from afar, financing could be marketed as a targeted remittance, wherein wealthier relatives send mobile money to pay for high-ticket items, just as they first spurred the growth of mobile money by sending e-money into villages.

So, what do solar panels, mobile money and prepaid have in common? They’re all part of a new pay-as-you-go financing model that could help those on irregular incomes afford high-ticket durable goods. 

I think that’s because unlike any other time in recent history, there is an intense interest in payments from people inside and outside of our industry.  As I listened to the conference sessions and the conversations we were having in the MasterCard booth, I kept hearing a lot of the same things over and over again.

Let’s start with the need for “frenemies.”  Now, this might be a term you’ve heard to describe two people who appear to be friends, but really aren’t.  At Card Forum, attendees used it to refer to the need to partner across the industry—even with vendors and suppliers they might not typically partner with—to develop the best solution.  Consider the EMV Migration Forum; partners and competitors alike have joined this group to help move the migration to EMV in the U.S. forward because of the benefits it will bring to the entire ecosystem.

There was also a lot of talk about the need for a crystal ball.  With so much happening in payments right now, from new loyalty and rewards platforms to the launch of digital wallets, everyone wants to accurately predict which technology will prevail and what the future will look like.  At MasterCard, we’re not placing any bets on just one technology, but we are laser-focused on how we can develop solutions to benefit our customers and ultimately, consumers.

And speaking of consumers—well, they definitely were not overlooked.  So much of the discussion at Card Forum focused on how we can better identify what the consumer wants, and how we can meet their needs.  While I don’t think anyone identified the silver bullet, there is clearly a commitment—especially here at MasterCard—to enhancing the consumer experience and educating consumers about the benefits of emerging payments technologies.

You’re probably already familiar with loyalty programs, but there are actually a few different kinds. The most common are rewards programs, which give you points that can be redeemed for items such as airline flights or hotel rooms. Offers programs allow us to bring consumers special customized offers through our relationship with your card issuer (AKA the bank). For example, if you regularly eat at a neighborhood Italian restaurant and use your MasterCard to pay, we can help tailor specific deals to bring you the most relevant offers for the next time you dine out. Third-party deals programs are based on the same concept and are a great way for small businesses to build loyalty. In the case of your favorite Italian restaurant, the offer could be a 20 percent discount or a free entree. What’s unique about our solutions is that we are the only payment network to offer all three options, and in doing so, we are presenting the most rich and relevant offerings to consumers.

The common thread in these programs is they all eliminate the need of cash; without using your payment card, you are not eligible for rewards, offers, or third-party deals. Spending $100 in cash at your favorite retailer doesn’t put you at the center of the attention from merchants, retailers and banks— all looking to bring you near custom made offerings of their products and services. These are the kinds of consumer values that make us so passionate about loyalty – and the very same experiences that cash just can’t deliver.

Independent research conducted on behalf of MasterCard asked people in 15 different countries across Europe which item they perceive to be the dirtiest, in a list of items including escalator handrails, library books, payment terminals and cash. In all 15 countries people said they believe cash to be the dirtiest!

To investigate these perceptions further, we commandeered the help of Dr. Ian Thompson, Professor of Engineering Science at Oxford University, who tested a selection of bank notes for us to get an indication of whether people’s perceptions are matched by science. And it seems they are! The notes tested harboured an average of around 26,000 bacteria, many of which can pass on infection. “Europeans’ perceptions of dirty cash are not without reason,” he tells us. “Previous studies, too, have indicated contamination with potentially harmful bacteria which can cause disease in humans.”

The #DirtyCash news too, also seems to be spreading (please excuse the pun)… Here’s a flavor of some of the coverage achieved:

•  “Well you’ll excuse me if I take suitable precautions when handling this stuff!” said CNN’s Richard Quest, who interviewed Hany Fam about the perils of dirty cash

•  “Most Europeans now prefer to pay by card and the majority also find it more hygienic”, said the UK’s most popular free morning paper, Metro

•  “Los billetes y las monedas son los objetos más sucios para el 63% de los españoles (Banknotes and coins are the dirtiest objects for 63% of the Spanish)” reported one of Spain’s main business titles, Expansión

•  “Svenska kontanter – en bakteriebomb (Swedish bank notes are a bacterial bomb)”, said two of Sweden’s main dailies – Svenska Dagbladet and Aftonbladet

•  “Contant geld is ontzettend smerig (Cash is extremely dirty)”, reported Dutch national De Teelgraaf

So, as the attention turns to Easter holidays, it seems we have yet another reason to think twice about paying cash when out and about. Consumers are already telling us they find other methods simpler and more straightforward and now it seems that, across Europe, hygiene is also playing a part in the decision on how to pay.  So be sure your Easter chocolate stays germ free and don’t let dirty cash anywhere near your chocolate bunny!