 "Rob Reeg, Ari Sarker")
MasterCard, the multinational payment services corporation, has inaugurated a technology hub in India, with facilities in Pune and Vadodara. The India tech hub is the company's largest outside of America, with an investment of $250 million. Rob Reeg, president, operations and technology, and Ari Sarker, division president, South Asia, and country corporate officer for India, talk to Shivani Shinde Nadhe about the plan and their outlook. Edited excerpts:
How significant is the setting up of the technology hub in India for MasterCard?
Rob Reeg: The hub is the way we look at India. We are starting with setting up of a centre of excellence in Pune, focusing on the processing unit. That's the software that helps banks come up with their payment systems. At Vadodara, we have another centre which is focused on digital and wallet-based opportunity. This centre was part of the acquisition of Sam Pitroda's C-Sam.
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What we like to build is global products that act locally. For instance, we built a new processing centre in the Middle East, using the software written at our centre in Pune. This is an emerging markets product and can be taken to other global markets, other than tapping the Indian payment industry.
What will be the role of the Indian tech hub in the company's roadmap?
RR: We have spent about $250 million over the past year in setting up our India technology hub. We believe the innovation coming out of these hubs will have local impact and help continue to advance India in the digital money space. At present, the penetration rate might be small but with the younger generation joining the workforce, this will soon change.
We have also stated that 10 per cent of our global workforce will be in India. We are betting big on India and the market is at an inflection time, from where it will take off…you have the government support, business support and consumer demand.
Ari Sarker: With the creation of a tech hub in India, the speed to market will be dramatic. What we are doing here is leveraging global time zones. The ability to turn around products across markets will be tremendous. Rob's whole desire was to have this centre so that we cut down the time to market.
Will the setting up of the technology centre impact your relation with existing IT services partners?
RR: We will still need help. I am never going to find everybody that I need. Wipro and Tech Mahindra have been great partners. We have a 700-800 team in Chennai created by Wipro; they've also set up a centre for us in Brazil. We have another group from Tech Mahindra in Malaysia.
When I started at MasterCard, about 80 per cent of our tech team was in St Louis, Missouri. There is always a comfort factor in such a set-up. But that's not the world we are living in. If we had the same time zone, things would be easy.
Security has been a big challenge for the payment industry. How important is it at MasterCard?
RR: Our CEO's vision is for a customer to walk into a bank and demanding a MasterCard because it's secure. Products like Apple Pay which tokenise the card number could be a solution for threat systems. If I can do away with card numbers, then these bad guys can hack away. We have a product called 'In Control', to be rolled out in India later in the year. With this, a customer can decide where the card can be used. For instance, I can decide that my card can be used at ATMs in Mumbai only and if it is used anywhere else, it won't work.
RuPay is being used by the Government of India for financial inclusion. How does this impact MasterCard?
RR: We need more digitisation in India and so, any competition is good, as it makes us all better in the long run. As long as there is a level playing field and you have the opportunity for the person/company who gives the best price and services and let the banks decide whom they want to work with, we are fine. But if you mandate something, you don't get the best.
MasterCard recently launched the contactless card with ICICI Bank. How do you see the acceptance in India?
AS: Mumbai and Delhi alone make up 45 per cent of overall electronic payment transactions. The GDP of these cities would qualify them as a small country. While there is a huge opportunity in the rural and semi-urban areas, Contactless is going to be in bigger metros. Our strategy on Contactless cards will be on transit growth. Wherever the transit growth is coming up, there is a huge opportunity.
