The red and blue logo embellishing Maestro payment cards is familiar to millions of cardholders across the globe. However, the payments industry will soon bid farewell to Maestro in the Europe region after more than 30 years of circulation. The international credit card provider Mastercard has announced it will discontinue its Maestro system, effective 1st July 2023. Issuers won't be able to issue new Maestro cards past this date, but all existing ones will remain valid until their expiration.
In this article, we look at how the update can impact your business, what’s the timeline, and what emerchantpay can do to help.
Maestro vs Mastercard Debit – what’s the difference
Mastercard’s decision to stop the issuance of Maestro cards will entail readjustments for merchants accepting this payment method. Before we delve into the nitty-gritty of this change, let’s deep dive into Maestro’s difference with its successor, Mastercard Debit, to identify the reasons behind the change.
Although the two functions have logo similarities, which signals they're affiliated, their main differentiator lies in retailer acceptance. While Mastercard can accommodate transactions via debit, credit, and prepaid cards for use online, in-store, in-app and at the ATM; Maestro wasn't designed for the full range of online shopping and has been issued mainly for in-store and ATM usage.
What's more, unlike Mastercard being a global entity, Maestro has a high penetration in the European consumer market where payment habits are vastly met by debit cards and bank transfers. GlobalData uncovers that one in three consumers in Ireland (34.3%) favour debit card payments while bank transfers have the highest traction in Poland (36.9%). Additionally, in Germany Maestro is issued as co-branding with the Girocard – formerly known as “EC card” – with more than 100 million issued debit cards nationwide and near 60,000 ATMs for cash withdrawals.
It seems that despite Maestro’s popularity, its card payment network presents some limitations that have led to the shift to Mastercard and which we’ll further explore in the following section.
From Maestro to Mastercard Debit – why the replacement and what’s the timeline
Launched in 1991, Maestro was the world’s first point of sale (POS) debit card with a mass circulation of 400 million payment cards. It allows cardholders to make cashless in-store and abroad payments or withdraw money from ATMs.
However, the payments industry and consumer behaviour have evolved in 30 years. Mastercard justifies the cessation of Maestro mainly with eCommerce thriving and starting to include other means of payments (e.g., mobile). Research from Statista reports that eCommerce sales are projected to hit $7.4 trillion by 2025. Given the growth in online shopping, the Maestro service can no longer provide cardholders with the features and capabilities they need within a digital world. By contrast, the Mastercard network is double as large as Maestro, delivering greater value and opportunities for a more convenient way of paying.
Any implications this brand update may have for your business and customers aren't something to worry about so long as you begin to adapt to it early on. For starters, consumers don’t need to take any immediate action. As mentioned above, any new Maestro cards, renewals, and replacements distributed before July 2023 will be functioning until they reach the end of the card’s term – 2027 at the most. However, acquirers are advised to help ensure Mastercard products will be readily processed by the designated date. In-store and point of sale merchants will also need to make relevant hardware and software updates for optimal card acceptance.
How emerchantpay can help
Ensuring that you stay on top of the upcoming change is pivotal to higher conversions and sustainable business growth. emerchantpay can help you optimise your payments and maximise profitability with our strategic 1:1 advisory and 20 years of deep experience in the payments industry as global leading payment service providers.
We provide tailored strategies to businesses of all sizes across multiple industries, empowering them to build convenient and seamless payment experiences for their customers. Not only is our rich selection of point of sale (POS) payment solutions and card terminals (both portable and countertop) support Maestro and Mastercard, but they'll also allow you to create a smooth, speedy, and secure in-store experience for your customers.
Contact our team of payments experts and learn how your business can successfully enter the era of Mastercard Debit.