Spanish telecommunications company Telefónica has signed a multi-year credit co-brand agreement with MasterCard Worldwide targeting its mobile phone customers and the unbanked in Latin America.
As part of the multi-year deal, MasterCard and Movistar, a Telefónica brand, will issue co-branded credit cards in 11 countries across Latin America including: Argentina, Colombia, Ecuador, El Salvador, Guatemala, Mexico, Nicaragua, Panama, Peru, Uruguay and Venezuela.
Benefits of the co-branded cards include, discounts at Movistar and the ability to accumulate points that can be exchanged for phone equipment or additional airtime.
“The launch of co-branded credit cards reinforces Telefónica’s customer development and loyalty strategy,” said Luis Miguel Gilperez, director of mobile business, Telefónica Latin America.
“MasterCard is an excellent partner for this program – its expertise, combined with the strong presence of both companies in the region is the perfect recipe for success.”
“We are pleased to partner with the leading telecommunications company in Latin America,” said Richard Hartzell, president, MasterCard Latin America and Caribbean region.
MasterCard has advised that it will process the Movistar-MasterCard co-brand card transactions in the majority of thesemarkets. All Movistar-MasterCard co-brand cards to be issued will be accepted at over 30.6m MasterCard acceptance locations worldwide.
“We will process all cross-border Movistar-MasterCard card transactions for the 11 markets,” said Noel Lustig, head of commerce development, MasterCard Latin America and Caribbean region.
“In terms of local processing, the specific markets will be defined as issuing-banks are announced. Therefore, at this point, it is too preliminary to provide [CI] with any further details.”
This is not the first time MasterCard has partnered with Telefónica. The two players currently have co-branded programmes in Chile and Brazil.
Movistar-Santander MasterCard was launched in Chile in June last year and Vivo-itaucard MasterCard was launched in Brazil in July 2009.
Lustig told CI that both of these cards target Telefónica mobile subscribers but are open to the general market and are backed by the same rewards platform that consumers will benefit from in Latin American countries.
“This new agreement will allow us to offer millions of Telefónica subscribers in the region, including those who are currently unbanked, access to financial products that are secure, convenient and flexible,” said Lustig.
At the beginning of the year, Telefónica signed a deal with Visa to roll out co-branded cards in European countries, including the UK, Spain, and Germany. Neither Visa nor Telefónica were available to comment on predicted plans to move the payment application to Near Field Communication (NFC) phones, when devices are available.
When asked whether MasterCard has any plans to launch an NFC payment application with Telefónica, Lustig said: “At this point it’s too early to speculate given that we haven’t announced any issuing banks. Should this be something that Telefónica wants to engage in down the road, MasterCard being the leader in contactless NFC payments, will be there to support them.”