Mastercard Incorporated MA, in collaboration with Payments and Commerce Market Intelligence and K2, has released a new report. It sheds light on how the existing international payment systems, designed to serve large corporations, fail to address the unique needs and challenges of small and medium-sized enterprises (SMEs) in Latin America.
Per the report, a significant portion of SMEs in the region are already engaged in global commerce, with three out of five currently working with international suppliers. In countries like Mexico and Brazil, 75% of SMEs have plans to expand their global partnerships. However, these ambitions are constrained by serious obstacles that SMEs often encounter, such as steep fees, unfavorable currency conversion rates and extensive payment delays.
This raises concern since SMEs are a foundational part of Latin America’s economy, representing 98% of the business ecosystem and contributing around 60% of employment.
To address these issues, Mastercard is leveraging its Mastercard Move platform, which encompasses a broad suite of money movement capabilities tailored to the realities of SMEs. Mastercard Move aims to improve cross-border payments by minimizing costs through fewer intermediaries, offering complete transparency with real-time tracking of fees and delivery times, and enabling faster settlement—often same-day or real-time—in more than 150 global markets.
The increased usage of Mastercard Move is expected to expand the SME client base across Latin America and boost its cross-border volumes. Its cross-border volumes advanced 15% on a local currency basis in the first quarter of 2025.
How are Competitors Faring?
Some of Mastercard’s competitors in the Latin American market include PayPal Holdings, Inc. PYPL and Visa Inc. V.
PayPal operates in multiple Latin American nations, including Brazil, Argentina, Mexico and Colombia, where it provides a range of financial and payment services, per reports. Its cross-border total payment volume grew 3% year over year in the first quarter of 2025.
Visa operates in Latin America through strategic initiatives like its acquisition of Pismo and planned majority stake in Prosa, supporting digital payments and real-time processing across the region. Visa’s cross-border volume improved 13% year over year in the second quarter of fiscal 2025.
Mastercard’s Price Performance, Valuation & Estimates
Shares of Mastercard have gained 23.8% in the past year compared with the industry’s 22.4% growth.
Image Source: Zacks Investment ResearchFrom a valuation standpoint, MA trades at a forward price-to-earnings ratio of 31.87, above the industry average of 22.05.
Image Source: Zacks Investment ResearchThe Zacks Consensus Estimate for Mastercard’s 2025 earnings implies a 9.7% rise from the year-ago period. The consensus mark for revenues indicates 13.3% year-over-year growth.
Image Source: Zacks Investment ResearchMA currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Mastercard Incorporated (MA): Free Stock Analysis Report Visa Inc. (V): Free Stock Analysis Report PayPal Holdings, Inc. (PYPL): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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