An update on Mastercard Track Business Payment Service & B2B Payments


“We see every single invoice rendered by a supplier sent to a buyer as an opportunity for a better outcome for both buyer and supplier. That is a foundational principle.” — James Anderson, Executive Vice President, Commercial Products, Mastercard

When I first heard of Mastercard Track Business Payment Service a few years ago, it caught my eye as Mastercard realized that not all B2B payments were going to go on a card.

Mastercard launched Track in 2018 as a trade platform to address identity, compliance and payment management needs.

The initiative was driven out of the Enterprise Partnerships group with a focus on expanding Mastercard’s presence in the B2B payments world by addressing three problems in the Buyer-Supplier relationship:

  1. Identity: Easier supplier onboarding
  2. Data: Create the ability for richer data exchanges
  3. Payment Efficiency: Lowest cost rail given supplier preference

Mastercard Track Business Payment Service started by wanting to make the screening and onboarding of suppliers more efficient. This was both an ambitious and expensive project. My first thought was geez, another KYC tool in a space that was becoming increasingly crowded. My second thought was around the quality of the supplier data, particularly for the varied onboarding needs of banks, fintechs, payment agents and others. Standards for these different actors go from relatively lite (very lite) to extensive (banks and their requirements for beneficial ownership rules, etc.).

During that time, Mastercard had announced relationships with a number of source-to-pay and procure-to-pay solution providers — Basware, BirchStreet, Coupa — to name a few. The goal was to be a single point of contact for the data contained within all these networks, plus data on suppliers outside the network.

For the Spend Matters PRO, I caught up with James Anderson, the guy from the quote above who labels himself as a “swing for the fences” guy. James took over commercial two years ago with a mandate to grow the B2B business. Coming from the consumer side of Mastercard, he was surprised at how low-tech and manual B2B payments and AP were.

We discussed how he transitioned the initial start of Track to center on payments and the data around payments. Mastercard was trying to address payments from a card network approach, and James said this would not work at scale. James decided to flip the narrative, and focus on developing Mastercard Track Business Payment Service to support payments, not a separate business in and of itself. Mastercard Track Business Payment Service was not going to be another KYC tool, but a database of supplier payment preferences to deal with the massive complexity intrinsic to B2B transactions and payments.

Mastercard Track: A Gateway to a New Kind of B2B Ecosystem (Part 1) — Vendor Introduction and Solution Overview

B2B payments represent a significant opportunity for payments providers. Within the U.S. alone, Deloitte research suggests that B2B payments are expected to reach $23.1 trillion by 2020, following a 5.8% CAGR since 2014, with large enterprises accounting for more than 60% of all transaction volume. Financial institutions, however, have placed comparatively less emphasis on the B2B space in favor of B2C transactions, which in spite of their smaller relative total size present less complexity in terms of technological and process problems to solve. Yet this is beginning to change. Banks, payment providers and other institutions are doubling down on the opportunities in B2B, and some are even starting to get their foot in the door by offering software targeted toward procurement organizations. For example, Mastercard has been rolling out its new Track solution in partnership with major banks and P2P and S2P suite providers and via public demonstrations at vendor conferences like Basware Connect and Ivalua NOW. Following the integration of Track’s payment capabilities with Singapore’s Networked Trade Platform (NTP) last year, Mastercard is getting its procurement technology start in, of all things, supplier master data and risk management. This may seem like an odd fit, especially when there are other technology providers offering similar — or in some cases, far more sophisticated — tools for managing supplier data and tracking third-party risk. As many B2B “old timers” know, banks and payment networks (Mastercard included) have been trying to insert themselves into P2P processes for nearly 20 years, and the results have been a failure every time, because they were always about funneling the transactions to their payment networks in order to charge suppliers 2% to 3% processing fees. This relegated these initial efforts to tail spend and highlighted how they couldn’t add value to the broader S2P process.

But we think this solution from Mastercard actually has huge potential and will likely be a market disruptor. Why? Well, from a practitioner standpoint, what would you think of a vendor who took all your supplier master data and then ran it through its “magic engine” and then showed you all the duplicates and supplier risk warning flags — and they did this on a freemium basis? That should catch your attention. And it should catch the competitive attention of D&B, LexisNexis, supplier networks, supplier risk/intelligence providers, supplier discovery tools and others that play in this space, as well as the partnering attention of S2P application providers that want an instant supplier network partner that can do more than process low-dollar transactions on a payment network.

Mastercard is just starting the first act of a longer, platform-based play, and the question today is simple: Is this “priceless” MDM and supplier risk solution worth a look? The answer is a resounding “Yes!” Because unlike other services in the space, Track takes the long view, supporting Mastercard’s aspiration to enable and connect into a global B2B ecosystem of multiple services, from business identity and risk management to payment facilitation and trade finance. And while we expect many of Track’s initial capabilities and partner offerings to evolve over time — what Mastercard has been publicly demonstrating over the past several months is more of a minimum viable product than a fully matured and battle-tested solution — the first cut is worthy of a deeper dive.

This Spend Matters PRO Vendor Introduction offers a candid take on Mastercard Track and its initial capabilities. Part 1 includes an introduction of Mastercard’s offering and a breakdown what the solution can (and can’t) currently do. Part 2 will provide a SWOT analysis and our key recommendations to interested parties (procurement organizations, technology providers, supporting services providers) evaluating Track as encountered through partner P2P or S2P providers.