Mastercard Launches Commercial Card Solution for Small Business Financing in APAC

Mastercard is launching the world’s first commercial card buy now, pay later (BNPL) solution for small and medium-sized businesses (SMBs) in the Asia-Pacific (APAC) region, according to a press release emailed to PYMNTS on Tuesday (Nov. 9).

Called Mastercard Pay & Split, the new solution empowers financial institutions (FIs) to offer SMBs a “first-of-its-kind, network-based, open-loop installments solution” that will soon be available anywhere around the globe. The initial rollout in the APAC region gives underserved SMBs access to flexible financing options.

See also: Mastercard Installments Plan Brings Instant BNPL

The APAC launch is also intended to help smaller operators jump-start growth in the region as economic uncertainty continues. Commercial BNPL products have been sought after by small businesses, according to the release.

In a Mastercard-commissioned survey, 77% of respondents in India and 80% of respondents in Singapore said they were interested in using an installment product specifically created for small businesses.

Globally, 75% of SMB operators who personally have experience with installment purchases indicated they would likely use the product for their businesses, according to the report Kaiser: Small Business Card-Based Installments Opportunity Analysis, 2021.

Read more: Mastercard Broadens Merchant Access to BNPL

Mastercard designed its commercial BNPL product to have similar features to the consumer BNPL options, with the addition of features tailored to the needs of SMBs. Pay & Split enables cardholders to convert any purchase into monthly or periodic installments.

“Financing has always been a hurdle for small businesses, but the economic impacts of the pandemic have really brought this issue into sharp focus,” said Sandeep Malhotra, executive vice president, products and innovation, Asia Pacific, Mastercard.

“Many small business owners rely on personal lines of credit or non-bank lenders to help finance their operations, which is not ideal in terms of sustainable business growth. Mastercard Pay & Split brings new credit opportunities to smaller operators who may not meet certain thresholds for a traditional commercial credit card or term loan, but need working capital to stay afloat or expand,” Malhotra said.