Mastercard launches tools for banks to build contactless wallets

Mastercard has introduced a package of software tools and services intended to help banks and fintech companies add contactless payment functions to mobile apps on both iOS and Android. The launch addresses a practical integration problem for payment providers as Apple begins opening access to near-field communication technology on iPhones after regulatory pressure.

The company said Mastercard Wallet Services is designed to reduce the technical work involved in building mobile wallet capabilities across the two main smartphone operating systems. For banks and fintechs, the service is aimed at letting developers build tap-to-pay features without creating and maintaining separate platform-specific integrations.

Near-field communication, or NFC, is the short-range radio technology used when a phone is tapped at a payment terminal in a store. Access to that capability has been a central issue in mobile payments because it determines whether a third-party wallet can offer the same physical checkout experience as a platform operator’s own wallet.

For years, Apple Pay was the only mobile payments service able to use the NFC tap-and-go functionality embedded in iOS devices for in-store payments, according to Finextra. Android has taken a more open approach, which left banks and fintech firms adapting their wallet technology to different operating system requirements.

That split created development and compliance burdens for financial firms seeking to offer their own wallet experiences. A bank or fintech building a mobile wallet has had to account for differences in operating system access, security architecture and payments certification requirements.

Mastercard said its new service includes a Secure Element applet and software developer kits for Android and iOS environments. A Secure Element is a protected component used to help store and process sensitive payment credentials, while software developer kits give programmers prebuilt tools for adding specific functions into applications.

The company said the package is intended to let developers enable contactless payment capabilities across platforms without managing separate integrations or EMVCo certifications. EMVCo specifications underpin chip and contactless card acceptance standards used across the payments industry.

The timing follows Apple’s 2024 commitment to open NFC payment access to third parties, after pressure from regulators around the world. That change created a broader opening for banks and fintechs seeking to offer payment options through their own apps rather than relying only on existing platform wallets.

Pablo Fourez, Mastercard’s chief digital officer, said alternative wallet adoption by consumers would take time, while broader platform access gives banks and fintechs new room to innovate.

“Ultimately, consumers could be the biggest winners of these changes, gaining access to a broader range of digital wallet experiences, rewards, value-added services and payment options offered through the apps they already use every day,” Fourez said.

The launch places Mastercard in a support role for financial institutions and payment technology firms looking to build wallet services as operating system access changes. The company did not disclose pricing, launch markets or participating banks in the announcement reported by Finextra.

This story draws on original reporting from Finextra Research.