The subscription economy runs to almost 7 billion globally and are estimated to top 9 billion annually by 2028. Subscriptions encompass delivery, entertainment, shopping, software, health care and dating among others.
And now Mastercard is ramping up its in subscription-related services by acquiring Minna Technologies. Mastercard’s EVP, Gaurav Mittal said: “It’s a way to build long-term, deeper relationships with consumers. With the relationship established, subscriptions also provide a way to enable new experiences and deliver a product to the consumer quickly and easily, especially when so much of our lives are managed online.”
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Minna’s payment-scheme agnostic services enable consumers to manage subscriptions within their banking applications and websites. Minna works with some of the largest financial institutions in the world. These teams and technologies will add to the broader set of tools that help manage the merchant-consumer relationship and minimise any disruption in their experience.
Mittal added: “At the end of the day, all of us involved in subscriptions – merchants, financial institutions, payment networks and others – can collectively create a win-win approach for each of us and most importantly, for the consumer. There is already a lot of work being invested in this space. And, we see an opportunity to do more together.”
Simplicity, transparency and growing relationships
According to Mastercard, the deal will help it to give consumers access to all their subscriptions in a single view. It says it is committed to delivering an easy to access view of subscriptions so people can sign up for, change, cancel or resubscribe to their favourite services.
“The end consumer should have no question about who they have subscriptions with and what they purchased. It comes down to activating solutions that provide consumers transparency (e.g., digital receipts) that help reduce involuntary churn, minimise blocks and create greater value.”
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By GlobalDataHe concluded: “The future of subscription management solutions must give merchants the ability to interact with their customers in real-time, driving engagement, retention and growth. The investments that businesses make in their consumers must continue beyond the first transaction or onboarding them. We are focused on strengthening these connections and supporting businesses in the ways in which they deliver loyalty, rewards and customised offerings to their consumers.
“We’re excited about the opportunities in the subscription economy. The future is about building on what works today and finding ways to do more. When we come together to collaborate and innovate we can help simplify a complex digital ecosystem, deliver better experiences and help grow the economy.”
‘Unstoppable rise of the subscription economy’
Giles Tongue, subscriptions expert at subscription tech company. Bango, told RBI: “Mastercard’s acquisition of Minna Technologies is a move that highlights the unstoppable rise of the subscription economy. Banks are increasingly waking up to the demand for subscription services, integrating them into their perks and rewards programmes.
“However, Bango’s data shows that around 1 in 5 Americans (18%) want their banks to actually help them manage their subscriptions — as consumers look for easier ways to handle the flood of recurring payments.
“This acquisition brings welcome attention to that genuine consumer need. As subscriptions surge, customers don’t just want the ability to cancel subscriptions. Flexibility is now the name of the game. Our data shows that 35% of subscribers want to be able to frequently pause and restart different subscriptions, while half want the option to take ‘payment holidays’.
Empowering consumers to manage subscriptions on their own terms
“This is key; it’s not about simply making it easy to cancel. It’s about empowering people to manage subscriptions on their own terms.
We expect to see more of these sorts of deals as more financial institutions start offering subscriptions as part of bundles and deals. At Bango we signed our first bank as a DVM customer in the first half of this year. While the banks are a little behind the telcos in terms of this move, we should increasingly expect to see a surge in the range of subscription services offered by financial institutions. London fintechs have already ramped up their subscription bundling offers, with neobanks such as Revolut partnering with firms like Deliveroo, the Financial Times and Airbnb to offer discounts to customers, a strategy which many financial giants like Mastercard, Visa, American Express and others could look to emulate in future.”
