Mastercard Inc. is facing pushback from retailers over a new product that allows customers to pay off their purchases in installments, according to Bloomberg.
The payments giant has begun telling merchants and their banks that it will charge retailers 3% of a purchase price each time a consumer opts to use the new program. Retailers will be automatically enrolled for Mastercard’s new buy-now, pay-later service, though they will have a chance to opt out.
The price tag came as a surprise to some of the country’s largest retailers, many of which have already negotiated separate deals with credit-card issuers and buy-now, pay-later providers that may limit them from offering competing services to their customers.
Others, however, are embracing the new service, given that the 3% cost, while higher than any of Mastercard’s normal rates for accepting credit cards, is less than what most standalone buy-now, pay-later providers charge for their products.
“This carries all kinds of new dimensions that go beyond the frustrations with credit cards,” Doug Kantor, general counsel for NACS, a trade group representing the convenience-store industry. “It’s definitely a source of frustration. Nobody should be automatically opted into any service in this context. And, frankly, the service that they’re offering doesn’t make sense for lots of retailers.”
Banking 4.0 – „how was the experience for you”
„So many people are coming here to Bucharest, people that I see and interact on linkedin and now I get the change to meet them in person. It was like being to the Football World Cup but this was the World Cup on linkedin in payments and open banking.”
Many more interesting quotes in the video below:
