MasterCard Inc., a global payments company, is the second-largest card processor after Visa Inc. The Purchase, N.Y.-based bank-card network provides services for the credit, debit and related payment programs of over 24,000 financial institutions, among other customers. Its brands include MasterCard, MasterCard Electronic, Maestro and Cirrus.
MasterCard and rival Visa have been seen as one of the few bright spots in the financial services industry in the downturn. As credit-card processors, they don't lend and so avoid the credit risk that card issuers take on. Instead, they make money from the fees they charge banks to process card payments. But MasterCard and Visa aren't immune to a slowdown in consumer spending, which could eat into their fees.
In 2008, MasterCard replaced ACE Ltd. in the Standard & Poor's 500 Index when the insurance company moved its place of incorporation to Switzerland. It also replaced General Motors Corp. in the S&P 100 Index. It recently acquired Orbiscom Ltd., a payments solutions software provider for financial institutions. The company also found an heir apparent to Chief Executive Robert Selander when it hired Ajay Banga, a veteran retail banker who ran Citigroup Inc.'s Asia-Pacific business. Banga is Mastercard's president and chief operating officer. The company snagged the No. 1 spot in Barron's 2009 ranking of 500 public companies due in part to its strong balance sheet.