Can DSS Help MasterCard Master the Credit Card Business

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Can DSS Help MasterCard Master the Credit Card
Business??

• Group 10
• Ahmet Kaleli
• Deepa Srinivas Rao
• Steve Miller
• Riku Melartin

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Market (2001)

• 30 trillion in payments made by
• credit cards
• The market leader is Visa with 44.5
• Second biggest is MasterCard
• with 31.6

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MasterCard

• Global payments company
• One of the most recognized and
• respected brands in the world
• In 210 countries and territories
• More than 25,000 employees
• 32,000,000 acceptance locations

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MasterCard Business Includes

• Individual card holders
• Small businesses
• (under 25 employees)
• Mid-sized companies
• (25-100 employees)
• Corporations (over 100 employees)
• Government Public sector

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Factors Affecting MasterCard Business

• Overall world economy
• Competitors
• Customer Behavior
• Collaborations
• Information Systems

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Importance of IS

• Credit card business is all about
• data
• Accumulation and dissemination
• of data
• Close links with customers are
• vital
• Providing DSS to customers

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MasterCard

• Competitive Forces and Value Chain Models

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Competitive Forces Model for MasterCard
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Value Chain Model
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MasterCard and ItsDecision Support Systems

• How it helped MasterCard..

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The Web Intelligence software

• Software that banks could use.
• An analytical software developed by MasterCard
  which makes the transaction data of all clients
  available to financial services and banks.
  

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Business Performance Intelligence

• One of the 27 tools in the Web Intelligence
  software.
  
• Used for operational reporting.
• Set of 70 standard reports

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MarketScope

• Applications that help banks and merchants work
  together to generate more purchases from the
  merchants if they are paid for by MasterCard
  
• Eg. Helps Wal-Mart stores

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MasterCards new data storage site

• Opened in May 2002
• Opened to handle the large volume of data and
  transactions MasterCard has in a day

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How DSS helped MasterCard

• Helped further its business strategy
• Provide value for MasterCard and its clients

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Results

• Has DSS helped MasterCard?

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MasterCard Issues Press Release

• On Nov 28, 2002 MasterCard International
  announced the completion of their 160 million
  payments processing platform.
  
• To provide financial institutions with
  unprecedented opportunities to realize
  operational efficiencies, develop new products
  and services create new revenue streams and
  enhance profitability

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Credit is Red Hot!!

• In 2001 credit and debit cards represent 26.4 of
  all consumer payments in US, up from 18.5 in
  1994.
  
• Over the past 5 years credit card business
  industry wide has been growing at 7 per year
  while debit cards have been growing at 41 per
  year.

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Meanwhile, Visa

• Spent 200 million to overhaul its computer
  systems
  
• 12 to 18 months behind MasterCard
• Has been pushing hard into corporate cards and
  now has 61 of this market
  
• Handles 55 of all internet transactions,
  compared with only 27 for MasterCard

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US Credit Card Market Share
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Sustainable Success??

• According to the Nilson Report, which
• tracks the industry
• By the end of 2003 MasterCard is will surpass
  Visa in outstanding balances owed on credit cards
  - important indication of profitability.
  
• During 2003, MasterCard is will issue more credit
  cards in the US than Visa.