HSBC’s First Direct brand has decided to switch to Mastercard debit card from next year, replacing Visa, the Financial Times has reported.
The is expected to significantly boost Mastercard’s market share in the UK debit card market, which is dominated by its rival Visa.
Mastercard UK and Ireland president Kelly Devine told the publication that the agreement was ‘validation of our approach and business model.’
“Having true scale in that debit space is more important to us than it was before. Growth in contactless payments has been staggering,” Devine has been quoted as saying.
According to data published by UK Finance, debit cards replaced cash as the most popular form of payment in the UK in 2017. Last year, it was accounted for 42% of all transactions.
While Mastercard is said to be a leading provider of credit cards, Visa has maintained a strong presence in the larger debit card market for the last decade, handling over 95% of transactions at its peak.
According to Devine, Mastercard’s market share could rise above 15% with First Direct’s 1.6 million customers.
Last year, Mastercard was expected to pass 20% market share. However, the shelving of a proposed deal with TSB forced it to put other projects on hold.
Recently, Mastercard added 11 companies to its Start Path startup programme and is expanding its Accelerate FinTech portfolio.
Earlier this month, Mastercard partnered with UK-based mobile business account ANNA Money to offer value-added services to its customers.