by Sarah Schmidt
May 2, 2014
Globalization is occurring at a rapid pace, requiring increased simplification and control over employer payments and expenses across multiple countries. Among payment providers (networks and card issuers alike), this has undoubtedly caused growing pains, as they struggle to craft solutions sophisticated and robust enough to meet global challenges of many stripes-regulatory and operational hurdles among them.
But in plain English, it also means payments expansion-following the arc of global growth and growing products and solutions accordingly. By building relationships, executing on now highly-advanced commercial card product and services, and delivering on promises of efficiency, simplicity, cost-savings and control, commercial card solution providers are reaping increasing rewards.
And it’s not just about the networks: All of the largest five U.S. banks by assets are aggressively pushing abroad, following corporate clients that increasingly demand global commercial card solutions. These players, already enormously successful card participants in their home market, also have the advantage of tapping Visa and MasterCard global commercial product and service platforms-and expertise-that are ready for prime time.
In this increasingly global marketplace, card acceptance at as many points of sale as possible is naturally important. But nowhere is it more important than in winning commercial card business among multinational companies, who are most apt to require it as a part of doing everyday business. Indeed, MasterCard has pounced on the acceptance gap separating it and American Express to gain competitive leverage, placing location acceptance at the forefront of its commercial card marketing literature. For American Express, which for a long time has had the commercial wind at its back, the challenge of closing the acceptance gap separating it from MasterCard and Visa takes on added importance.
In the shadows looms UnionPay. Packaged Facts estimates that UnionPay network volume grew a phenomenal 203% during 2010-2013, challenging Visa on global network payment volume. More established players have a global head start-and decades of commercial card experience. But UnionPay is just beginning to flex its muscles outside of its home market. On the heels of Chinese companies’ own desires to tap global card solutions, UnionPay’s increasing global presence is assured, adding a formidable commercial card contender to the field.
This blog is based on research featured in Packaged Facts’ Commercial Payment Cards: The U.S. and Global Markets and Trends, 8th Edition, published in March 2014. Add this report to your own intelligence library and receive a 5% discount during our promotional period effective through July 1, 2014. Use code PF05CC
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