The middle market continues to draw the attention of payments and banking companies, as further confirmed by the fact that Mastercard last Tuesday, February 18, announced a package of digital and financial management tools designed for the mentioned segment.
The new suite of solutions from the specified payment industry giant has been named Mastercard Mid-Market Accelerator. This solution package is designed for companies with annual revenue ranging from $10 million to $100 million. The number of employees of the mentioned firms varies from 50 to 250 people. New solutions from the payment industry giant will help banks and fintech companies in catering to their lower middle-market customers. This offer will initially be available in the United States. Then consumers in other countries around the world will have the appropriate access. The new package of solutions from the payment industry giant combines Mastercard’s digital payment technology and value-added services with features from partners that ensure transparency, security, and automation.
Mastercard’s Jane Prokop, EVP and global head of small and medium-sized enterprises, said that the Accelerator will provide a flexible suite of solutions that financial providers can customize to meet the needs of middle-market customers.
The payment industry giant cooperates with issuers such as Citizens, and fintech providers, including Navan, which offers solutions for expense management, and Trovata, specializing in cash flow management.
The new Mastercard business card is part of a middle-market package and offers a selection of the company’s benefits under existing small businesses and commercial card programs and new rewards. The card is available in both physical and virtual formats. This product also includes security enhancements such as ID Theft Protection, HealthLock, and Zero Liability Protection.
Jane Prokop, while talking to media representatives, stated that companies operating in the middle market face unique challenges that neither small businesses nor large corporations encounter to the same degree. While small businesses benefit from simplified financial products, and large corporations have access to highly customized solutions, middle-market firms often find themselves in a situation that consists of such negative circumstances as problems with access to capital, fragmented banking relationships, and outdated underwriting methods that do not reflect their rapid growth.
Jane Prokop stated that the lack of access to the right kind of capital needed for business growth is a huge pain point in the middle market. She noted that the relevant companies require more complex underwriting since these firms often work with multiple bank accounts, which forms a fragmented picture of their financial activity.
Mastercard research puts the average middle-market company growth rate in its network at 12% last year. This means that the mentioned firms are often faced with the fact that traditional approaches to underwriting fail to capture their current trajectory, which is the reason for a lag in access to necessary financing. Moreover, many companies in this category still rely on manual processes such as invoicing and reconciliation, which limits operational efficiency.
According to Jane Prokop, the main component of Mastercard’s strategy for better serving the middle market is the adoption of virtual cards. Despite the advantages of the mentioned product in terms of parameters such as security and expense control, the use of these cards has not yet reached the level that major financial institutions would like to see.
Jane Prokop highlighted two primary benefits of virtual cards, including secure supplier payments and delegated spending control. According to her, the consumer, using the mentioned category card, provides a one-time number that cannot be applied repeatedly. She also noted that this is a game-changer in terms of security. Moreover, for companies where business owners may still be personally liable on a corporate credit card, similar virtual products offer a secure way to delegate spending to employees and contractors without being exposed to fraud or mismanagement.
Jane Prokop stated that Mastercard’s middle-market initiative places issuers at the center of the experience. By integrating fintech partners with financial institutions, the payments industry giant aims to form a more robust suite of offerings that address the needs of the middle market, such as cash flow management and expense tracking. Jane Prokop noted that this case implies not only theoretical improvements. According to her, Mastercard has been working closely with issuers and middle-market companies for more than 18 months to develop solutions based on their pain points.
The accelerator ensures that firms can access the mentioned services directly through their existing banking relationships, streamlining adoption and making it easier for issuers to provide tailored solutions. This announcement also aligns with Mastercard’s broader partnership strategy, which is rooted in collaboration between traditional financial institutions and fintech companies to create more effective financial ecosystems. Jane Prokop stated that the payment industry giant is looking to pair up parties in ways that allow them to serve the middle market more holistically. According to her, this approach helps banks graduate businesses seamlessly from small business solutions into middle-market services without losing customer relationships. She also noted that scalability and personalization remain at the core of Mastercard’s vision for the mentioned segment. By using richer data insights, issuers can better understand customer needs and deliver more tailored financial products.
Jane Prokop stated that personalization starts with data. According to her, many middle-market companies are trying to get a holistic view of their financial standing. She noted that Mastercard, by making this information more accessible, empowers both companies and their financial providers to make more informed decisions.
It is worth noting that the expansion of the payment industry giant in the middle market consists not only of refining its card offerings but also of evolving beyond cards together.
Jane Prokop stated that providing solutions that go beyond the card is really core to Mastercard’s vision. According to her, the payment industry giant is focused on delivering a full range of financial and payment solutions that help its partners and their clients succeed in an increasingly digital world.
As we have reported earlier, Mastercard Rolls Out Digitally Connected Credential Offering Multiple Payment Options.
