Good morning. Welcome everyone. Either those of you who are joining us here in New York or those who are joining from the webcast. I'm Barbara Gasper, Head of Mastercard's Investor Relations, and on behalf of the entire Mastercard management team, I'd like to thank you for joining us this morning for our annual investor community meeting. We think that we have put together a program today which will address many of the topics that we hear you ask about so often. It's a combination of formal presentations as well as an afternoon with lunch table discussions and product demonstrations. Ajay Banga, our CEO, will kick off the morning's formal presentation with some comments about how we are progressing on our strategy.
We'll then hear from several members of our management team, starting with Gary Flood, who's President of Global Products and Solutions, who will provide an overview of our products and services efforts, and then hand it over to three members of his team who will take a deeper dive into their areas, starting with Craig Vosburg, our Chief Product Officer, Kevin Stanton, President of Mastercard Advisors, and Kathy McCall, President of Global Processing. We'll then move to hearing from a regional perspective, starting with Chris McWilton, who's President of our North American Markets.
Following a brief morning break, Ann Cairns, our President of International Markets, will give everyone an overview of our non-U.S. operations, and then we'll move on to a panel discussion with three of her regional leaders, Dennis Chang from China, Gilberto Caldart from Latin America, and Javier Perez from Europe, who will each talk about some of the developments in their areas that we know you want to hear about. After that, Martina Hund-Mejean, our CFO, will provide the financial perspective for the business, and then we'll move on to the Q&A session. After that, Ed McLaughlin will give a quick preview of what's included today downstairs in our product experience area, and then Ajay will be back for some closing comments. We expect to adjourn about 12:30 P.M.
Copies of the slides that we're using today can be found in your handouts or on the meeting app being used here in the room, and they're also posted to our website under the Investor Relations section. Additionally, an audio replay of this event will be available for 30 days until October ninth. Along with our presenters, we have a number of other senior management here with us this morning, and rather than go through and introduce all of them, we have included a list of them with their photos in your meeting materials. To help facilitate the dialogue with our executives over lunch, there is a diagram on page five of the meeting materials showing the location of several lunch and discussion tables and the executives who will be at those tables.
Executives who are not hosting a table will be stationed around the product experience area so you can grab them and talk to them there. I do want to make a special call-out to the other members of my IR team, Matt Lanford, Jesal Meswani, Christy Lewis, and Tina D'Amato, for all the work and effort they've done to help put this event together today. All of us will be around if you have any questions or things we can help you with afterwards. Just a couple of administrative items to get out of the way before we get started. As in the past, we will have the ability to take questions from those of you participating on the webcast, by hitting the ask a question button on the webcast player. Our agenda does include a brief 15-minute break.
For those of you on the webcast, you do not have to reconnect. You can just stay on. As a courtesy to our speakers and those around you, we ask that those of you here in the room please silence your mobile devices. Finally, just a reminder that today's presentations include some forward-looking statements about our expectations for future performance. Actual results could differ materially from those suggested by our comments today. Additional information about the risk factors that could affect future results is detailed in our SEC filings, including our forms 10-K, 10-Q, and 8-K. With that, I'd like to turn the podium over to Ajay.
Thank you. Good morning, everybody. Barbara, thank you very much. This room is pretty cool, and when you go see the product room downstairs, that's actually quite a stunning room. The best part, it's free because you get listed on the NYSE, and we get it free. Barbara is the cheapest date you can go out with, and she's demonstrating that right now. I'm delighted to be here. It's a little different in construct with the pillars at the back, but it's a nice place to be. I've got maybe want to talk to you for 10, 15 minutes max. Ten is what she wants me to do. I will try and set the tonality for what you will hear from us over the course of today, right?
The first part is a slide you've seen earlier, and that's those three concentric circles. I use it every time in the company. I use it in every one of our town halls. We use it in our discussions because it keeps us grounded on what we are trying to do. You know that the innermost circle is the actual portion of the total that is electronic, and we will come in the next page to the fact that it's still 15%. The rest of it is what's determined by many things that some of which we can control, like the effort we make to grow electronic payments versus cash and check. That's the second circle.
The one that we don't control, which is how personal consumption expenditure evolves over a period of time, which is the outermost circle, and that tends to grow at between 4%, 5%, 6% a year, depending on the year, depending on the dynamics of different markets.
Broadly, those three concentric circles are still where our entire strategy is rooted. If you have to grow the second circle, which means grow the share of electronic payments versus cash and check, growing the pie, there's certain sets of strategies you can take to do that, from working on acceptance, from trying to get after the kinds of payments that have traditionally been in cash, be they very small, low-value payments in the more developed countries in payments, or be they also the larger high-value payments like college fees and the like, which tend to go outside of the traditional electronic payment system. There's work to do there.
There's always work to do as well in financial inclusion, and that's something you'll see us talk about periodically, but there's now still 2 billion adults who don't have access to any form of an account, and therefore no way for them to participate in the marketplace that we think could be continuously driving our growth for many years to come. A certain amount of our energy and effort is spent on being a leader in the space of financial inclusion, just purely to make sure that that pie keeps growing, but also to make sure that governments view us in a form as being helpful to being a part of that transformation of their country and their economy. Something that you will see up ahead is a very important issue for all of us in this industry.
If you want to grow your share in the 15%, it's all about building competitive advantage, either with tinkering with your products, which you will hear of from Craig, we do that all the time, or with new and innovative ideas that you will see downstairs, you've seen in past product demos, you'll hear about some of them today as well, or, most interestingly, by building bundles of services that are adjacent to the old clearing, authorizing, and settlement transaction, but that put together give you a nice profit picture, but also give you a very good slice of a recurring revenue stream that belongs in a different segment of the customer's pocket. We're trying to get ourselves into being an integral part of all that. To do that, you've got to touch transactions.
If you don't touch them, if you don't see them, if you don't process them, there's only so much you can do with services and innovation. A lot of our effort and energy and the money we've invested, and it's close to, Martina will tell you it's $5 billion odd. You've probably already seen it in your slides, and most of you, as Tom Russo reminded me, have probably gone to the last page and seen our guidance, and you don't really give a shit about what I'm going to say right now. All you really care about is let's get to the number. Please don't do that. Stay with me for a little while and stay with all our pals. We've worked hard for you. We'll get there. We'll get there. It's a good business. That's the main thing.
Having said that bloody 85% hasn't changed in 6 years. You guys will probably say, "He says the same stuff every time," and it's still 85%. The issue is it's a leaking bucket that we're dealing with. That's because in the developed world and in the emerging markets, the ratio of cash to total personal consumption expenditure has reduced. It's down almost 200 basis points in the developed world over these last 3, 4 years. It's down almost the same number in the emerging world. The problem is because the PCE in the emerging world is growing way faster than the PCE in the developed world, the weighted average math brings it back to 85.
That's kind of a good problem to have because it's got the idea of a long runway of growth, but it can be somewhat frustrating if you're trying to evaluate yourself against how you're doing on the 85. You really are doing well in both different kinds of markets, but the growth of personal consumption expenditure is changing the way this number gets perceived. There's lots going on in the industry, and I'm not going to go through every one of these, but I'm going to walk through 3 or 4 thoughts. There clearly is an accelerating trend in the space of moving payments from cash and check to electronic. There is. By the developed world, by the emerging world. Countries in the emerging world that never talked about electronic transactions are now openly saying, "We want a cashless country," a cashless Nigeria, a cashless Egypt.
Even the Indian prime minister, India is the poster child for how not to pay your taxes in some ways. Even the Indian prime minister is out there publicly talking about the idea of a cashless society. That's very different from 5 or 6 years ago, when every person we met in the world outside never paid any heed to the importance of this. Their efforts, combined with digitization, combined with all the secular trends of urbanization and the like, is clearly changing the way this pathway to electronic will operate. At the same time, the other side of that is that those very same governments are viewing electronification of payments as critical to their future.
They're far more interested in how it builds, how it develops, what the rules of the road are, who the players are, and how they will operate in that ecosystem. You get heightened regulatory interest. Sometimes that regulatory interest, as you know, is not necessarily your friend, other times it actually can be a facilitator for accelerating the shift of electronic payments. There are examples in Egypt and examples even in Europe right now, which Javier will get a chance to talk about, that could fit into that thinking. Combined with that is a far more demanding consumer experience, where they want this omni-channel experience, where all of you and I are doing the same things. We search online, buy in a store, and return by mail.
We will want that to happen in every form of commerce and business we are doing. I don't think one replaces the other. It's the seamlessness of the consumer experience that'll determine how well that system works. That rapidly evolving consumer experience is also very much a part. What's changing in our world. Then, of course, there's the whole industry dynamics. You've got maybe Visa and Visa Europe coming together. That's a different place to be than where we've been. You've got new and innovative companies coming into the space. You've got digital giants looking for their space in the sun.
You've got banks saying, "We'd like to operate the way we want to and do the things we think we can do the best with our consumer." You've got merchants who clearly are occupying a different role than they used to in the payments ecosystem, and the power they exercise in how that works. There's a lot of things going on in this space. The one thing I do feel relatively good about is that in addition to the acceleration of the trend for electronic payments and the runway that provides, is this demand for adjacent services that I see coming up from every client and every single merchant and bank and government.
When you talk to them about loyalty, when you talk to them about safety and security, when you talk to them about the power of data and analytics, when you talk to them about managed services and about the power of payments consulting, there is a very different dialogue that results. It's not that we don't have to discuss how to win or lose a deal. You still have to do that. There's a very different dialogue, and there's a very different revenue stream with a very different form that we're building consistently and steadily. That, to me, is all that's going on inside the industry. That's my last slide, and I've got 54 seconds on that clock. Barbara told me when I started, "There's a clock there.
When it gets to red, it means it's time for you to shut up." I said, "I am color blind. I don't see colors well." That's one of the problems. Yeah. Strategy hasn't changed. Grow, diversify, build. That's the first three things. Grow our core business. If you don't keep growing credit, debit, prepaid, and commercial I'm not talking about cards, I'm talking about the forms of payment. Credit, debit, prepaid, and commercial. Consumers will either pay earlier, pay now, or pay later. That's not going to change. That's prepaid, debit, and credit. Then there's the whole commercial space, which hasn't even come up right now in what I'm saying, but it will when Craig is on stage. You will see the efforts we're putting into that space. That, by the way, was not in the numbers of the 85%. That's another aspect altogether.
You will see us very focused on growing that core faster than the market. The second part is diversifying the kind of customers we deal with, and you've seen that over the years, the digital giants, governments are now customers, merchants are customers through the data and analytics service, not just payments customers. There's a lot going on in diversifying our customers. In the U.S., in North America, half our sales force now covers merchants. Half covers traditional issuers. They've both grown, by the way, but it's half-half. It wasn't that way five or six years ago, and Chris can tell you about that. Then we're trying to build new high-growth businesses, and that's the adjacent services I was talking about. That's principally in that space. A lot of the investments we've done in the last few years fit into that grow, diversify, and build.
They're built on a platform of the right technology and innovation, recognizing that even though we're a B2B business and we are not a B2C business, we do have B2B2C, and therefore going to our bank clients and our merchants and the governments with a deeper, more focused consumer-facing insight is a key part of what we're trying to do. That connected to innovation, which Garry Lyons has been driving for us with Ed McLaughlin and their team, is part of what we've built into everything we're doing. Craig will talk about it. You'll see demos downstairs. Garry will talk about it, but that's what we're up to. That built on safety. Again, downstairs in the product demos, you will see the efforts we're doing on securing the consumer, the person, securing the transaction, and also securing the whole process by which the whole system works.
You'll see all three with Ajay Bhalla's team downstairs. All that built off the right kind of brand, but built off people. I'm going to spend a few seconds on the people because it's a huge transformation inside our company. We used to recruit bankers and consultants, and they are very useful for our business. We used to recruit 65% of them as bankers and consultants. Today, 65% of our hires are not bankers and not consultants. They're people from consumer firms, from technology firms, from ex-government jobs, from merchants. That is transforming the direction of the conversation around the tables in our company. It is completely transformational. Issues are getting discussed that would never have got discussed. Risks are getting taken that would never have got taken. I'd like more discussions, more risks. Don't get me wrong.
This mix of people joining the company is a key part of what we're doing. Similarly, we're encouraging a very different profile of individual, even in terms of their acceptance of new technology. Millennials are clearly different from people of my age group, and we used to be 9% of our company was millennials in the year I joined. We're now beyond 37%. Inside our company, again, is a very different dialogue and a very different nature of conversation. It's not that people of my age group don't bring the right value. We bring experience, institutional knowledge, and capability. I recognize that. It's the mix I'm talking about. Building this world-class mix of people, both the type of people and their backgrounds, their experiences, and then where they are located, the final one.
Where we used to be 60-odd% of our employee base in the U.S., it is now 60-odd% outside of the U.S., while the U.S. itself has grown in the number of people quite dramatically in that period. It's not just that we are growing here and declining there, it's the nature of the mix that's changing. That's a key part of changing where the company is headed. That's our strategy, grow the core, diversify the kind of customers we deal with and the markets we're dealing with. You'll see our efforts in Africa are a large part of that. Build new businesses, but do all that on a base of innovation, of comprehending the consumer, of technology, of the right kind of people, leveraging the right kind of brand. That's what all of today is about.
You'll see that in the conversations, and you'll see it in the product demos. With that, I'm going to hand it over to Mr. Flood.
Thank you, sir. Okay, I think Ajay's provided a great frame for us. It's interesting. I think I wake up every morning now thinking about grow, diversify, and build. It kind of guides my day and my thinking. All right? If you actually handle the grow part really well, you can do amazing things in diversification and building adjacent spaces and businesses. All right? It's all rooted in understanding an extended stakeholder set. If you think back five or so years ago and the type of stakeholders we were concentrating on, it was a little more narrow than it is today. As we extended that stakeholder set, it opened up tremendous opportunities for us. When we think about consumers, great buying experiences, nice and simple. Help me shop and make it frictionless. Financial institutions, help me give my consumers great buying experiences.
Let me delight them. Merchants, they want to sell more stuff, make it frictionless, help me get my job done, help me sell things. Governments, financial inclusion, transparency, efficiency, but at the end of the day, there's an awful lot of work around the world on making things more efficient, transparent, bringing more people into the formal economy. That's just not a consumer proposition, it's also a merchant proposition. As you bring them in, they need places to shop. They need places to buy things. The government work is both bidimensional, I guess, is the way I'd express it. The digital players, they want to provide great experience to their consumers, and payments is front and center. All right? Think about that. Telcos, stickiness, reach, and are great participants along the lines of financial inclusion.
If you root this all in what consumers want, which is what all these folks do, you can kind of really guide your activity. Very straight, very narrow, and stay true to what you want to get done. At the end, Ajay reflected on the space, the cash space, the 85%, how it's moving. I look at this as you have cash conversion, you have digital or physical-to-digital technology. Therefore, what it opens up for me is more consumers, more merchants, and at the end of the day, more transactions. If we stay rooted here, and then we apply this discipline or our thought processes to our grow, diversify, build strategy, we can get some very strong things done. Now, Ajay reflected on you got to grow debit, credit, commercial, and prepaid. We set aggressive objectives for ourselves five years ago. All right?
Craig is going to reflect on those and what we did to kind of get there. When you zero in on that, leveraging perhaps some of the services we built along the way, it's a very powerful proposition. I'll reflect on some of the bundles. Ajay referenced bundles. I'll reflect on some of the bundles in a few minutes. The diversification on merchants, the middle column makes me ecstatic. I've been here. This is year 30. All right? We were a financial institution-based company. When I provide a little dimension of what we've gotten done with merchants, governments, telcos, digital players over the last several years, it's exciting, and it's opening up more space for us to get amazing things done. Then on building new businesses. Customers want to talk about what they need to get their jobs done.
We have invested in bringing together assets and services that matter, that when bundled together and bundled with our people, provide great solutions to our clients, enabling them to grow their businesses, become more profitable, and as a result, we grow and become more profitable. We've invested for growth. Today in a GP&S organization, 70% of my people resources are outside the U.S. They're aligned with Ann's divisions and countries. All right? 30% are with Chris in North America, more than enough. When you think about the transition of our company and the profile, that's a very significant adjustment for us. The people side that Ajay touched on is huge. All right? The combination of people, technology, and services fuels our growth. Now I'm going to spend a few minutes drilling down to each one of these areas for you.
We had some fun figuring out how to do this, the from-to scenario. We were thinking about putting in a slide that was from before Ajay to Ajay, which would have been an awful lot of fun. Might have been a career-limiting move, I decided not to do it. You wanted to do that. From a core perspective, consumer credit, broad-based segmentation. All right. From broad-based segmentation to targeted value propositions, distinct segments. Payoff for me on this one is the consumer insight that Ajay referenced, that Roger and the marketing team drive with Craig and Ed at the foundation of getting things done. Right. The payoff here for me is in Latin America, a platinum revitalization program, leveraging consumer insights, launched 14 countries. First half of this year, volume's up 21%, accounts are up 18%. That's above plan.
That's driven off understanding consumer needs and desires. Second one is consumer debit, safer alternative to cash. From one, it was a general purpose debit program. We talked about ATM to point of sale, right. The activity, if you remember the five-step process where we drive behavior. Here, we're going to extend that, we scaled it. We're probably doing 50 to 60 of those this year versus 20 to 30 in prior years. The movement is extending that around the world. In addition to that, one of the best examples I can use here is Tabung Haji, Islamic payment system over in Malaysia. Certified to allow benefits, Mastercard Advisors work with them to develop a program and actually bring it to market. Mastercard Advisors, if you think about consulting and information services, Ajay touched on managed services. That part's about execution, which is different than what anybody else has.
Commercial, Craig's going to talk about. I love going from 30 or eight to 120 markets. I was here in 1987 when we launched commercial products. Our progress has been amazing. Our investments have been focused, this is a tremendous opportunity for growth. As Ajay reflected, we really haven't touched that much on that. Craig will get into that. Prepaid's very similar to me. More narrow number of markets to an extended market list. I think Michael Fiore, who runs prepaid for us today, reflects on it saying, "No one is doing more in prepaid than we are." Two great examples for me, South Africa Transit Solutions, where we have a prepaid card targeted to 15 million transit riders that are going to use our processing capabilities that Cathy McCaul provides. That's an example of a bundled solution.
Next one is Bidvest, which is a travel card provider based, again, in South Africa that is leveraging our program management services. If we didn't have our program management services, that deal would not have come our way. Think about this list. Transit solutions, travel management services. Those are two very distinct capabilities and customer sets from where we were years ago. The core business is key. We're on it, we're growing, we're not going to let up. Next is diversification of our stakeholders. I said this chart I love for many reasons. I'll start with merchants. Acceptance-based relationship to one where we expanded it beyond that, helping them grow their business. The best dimension I could use is the work that our Mastercard Advisors team does with an annual 100% increase in engagements with merchants.
We do everything from customer value management to data analytics to gateway services. We help them grow their businesses. When I think about the growth rate, it's not 5 to 10 to 20 to 30. This is hundreds of engagements over the course of a year, which is very different from where we were. Governments, limited engagement to broader relationships, enabling 900+ government programs. The types of programs, financial inclusion, benefit distribution, payroll, procurement. It extends to a wide range of services. Telcos, digital players. Not long ago, I think we were having conversations about how telcos and digital players might disintermediate us. Yet, as we've worked with them over the course of the years, there's common ground to get an awful lot of wonderful things done for consumers, merchants, and financial institutions. Global and local engagement. We have over 150 initiatives in 50 markets.
If I think about telcos in Nigeria working with eTranzact and HomeSend, which is a JV we have in London to enable inbound remittances to 40 million consumers. Again, a different type of technology and capability and an extended customer set. If I think about digital players, we're engaged as channel partners with Apple, Google, Samsung, and others. You've read all those announcements. That work leverage our technology, our people, and close working relationships with our customers, issuers, financial institutions, as well as the digital giants. Strong progress on diversifying our stakeholder set. When I think about building new businesses, if you listen closely to what your customers want, if you reflect back and think through that stakeholder set, the needs that they're looking for, what do they need to do? We've built businesses around loyalty, advisors, safety, security, and processing.
On the loyalty side, Craig will dig a little bit more into this, 100 million accounts in over 100 markets. It's a one-stop shop. No other payment network has this. This is unique, and it differentiates us in the marketplace. Let me reflect on advisors. The ability for us to actually work with merchants, governments, digital giants, telcos, and our financial institutions around the world was a journey that we started on in advisors over 10 years ago. We have resources deployed around the world, consultants, managed services folks, and data and analytics resources that can help them grow their business. In many ways, we work with them to grow their business, to drive volume, to drive new account production, and to drive revenues.
This is an outstanding example of an adjacent space that clearly differentiates us and helps our customers grow their businesses, and in the end, we grow ours. Nobody else has this. There's not another payment network that's made this investment. It's unique and it's different. Let me talk about safety and security in multiple layers. We've built an awful lot of capacity into our network to do things for our clients. In some parts of the world, we're screening transactions on behalf of countries and their local initiatives. We'll be agnostic. We'll do somebody else's transactions, run them through our rules engine. We built in capability and capacity to screen for fraud, where we've actually reduced issuer fraud up to 50%. We've also built in the capacity to help issuers and merchants approve more transactions through better rules engines, reducing bad declines by over 60%.
The safety and security aspect is key, and making sure that the infrastructure's in place to get that done is key. At the same time, we can help the business grow, and we can make money at it as well. Processing is very similar. If you think about processing, and Kathy will reflect on this, I love the fact that we're in 65 markets around the world between gateway services, processing, and payment gateways. If you're extending these services to your stakeholder set, you need to be involved in their conversations. You need to understand exactly what they're trying to get done with their businesses, and that's fundamental. Kathy's going to reflect a little bit more on processing in a few moments. We talked about driving the transition to digital, which is a big part of what we've been concentrating on.
Digital isn't just about a wallet, guys. It's not just about a wallet capability. It's about infrastructure. Sure, it's about a wallet and a container, but it's also about added services like personal payments. If you think about the infrastructure, security through tokenization, the work we did with MDES, what we've built into our network and what we've enabled. If you think about digital ID and verification, a component of MDES, again, built into our network and enabled. Then the last part, which is extremely important, is API offerings enabling developers around the world to create value and solution sets off of our infrastructure. 80% of our Mastercard credit and debit accounts in the U.S. are enabled through MDES. We're extending to other parts of the world. It's fundamentally integrated in our network, and Rob runs it just like he runs a network.
It's up all the time, and it's there for our clients when they need it. If I think about wallets, as I said, it's broader than just wallets, but at the end of the day, Masterpass is a key component of our strategy and has been for two years, three years. The digital acceptance mark has been built. We're in 24 markets. We're extended to 250,000 merchants. On top of that, though, when you think about capacity and capability, we've invested in resources to actually help our customers digitize their frameworks. This is the acquisition of C-SAM that we made a while ago. We've integrated them in. Their capability, their understanding of technology, and how we apply that with our customers, issuers, and merchants is unique and it is different. No other payment company has that. All right? We've made the investment.
Ed likes to refer to Mastercard as digital by default. If you have a Mastercard, you need to be digital. Strategically, that is the frame that we're operating off of. Your lives have become more digital. Our enablement has to become completely digital, domestically as well as cross-border. Faster payments, personal payments, a big part of the digitization experience. If you think about where we were several years ago, we had a program called MoneySend. It reflected Mastercard to Mastercard transfers. Today, we're in a completely different place with the investments we've made in Mastercard Send.
We virtually have access to every checking account and debit card in the U.S., about 50% outside the U.S. When you compare or integrate that with HomeSend, which is our JV over in London that has a connection to over 1.2 billion mobile money wallets around the world, you have the foundation for an extremely powerful personal payments infrastructure. When we reflect on this, transition to digital, much broader than wallets. Infrastructure, standards, developer community, Masterpass, I've reflected on, the extension of that to include personal payments is critical. Competitive advantage. Ajay kind of touched on this. Left side, driving differentiation, right side, driving innovation. Two dimensions to it. Let me reflect again. Loyalty. We've invested. We have a service. Over 100 million accounts. We can work end-to-end, one-stop shop. Craig's going to talk a little bit more about this in a minute.
Advisors and information services. We've made the investment in the people. We've deployed them around the world. They provide great expertise to our clients, and they leverage all the other adjacent businesses we have to ensure that the solutions are going to solve what the client's problems are. They can look at the data and understand, create the solution, and through managed services, execute. Safety and security. In many ways, built into our network, built onto our cards, and watching every transaction. Fundamental. The processing and switching side is also a great foundation. The more you see transactions, the more you can do with them, the more you can enable your clients to grow their business. They grow their business, we benefit. Kathy's going to reflect on processing in a moment. I don't want to move off this slide until I deal with innovation.
Garry Lyons is here. Garry came with our acquisition of Orbiscom seven or eight years ago. He's been driving our Labs development for probably the last five years. Labs for us has become an unbelievable differentiator. Our clients want to work with us and reflect on what we do and how we do it. All right? You're going to see a series of demonstrations at the showcase. Many of those are reflective of the energy and driving passion that the innovation agenda that Garry has deployed is pushing through our organization. Mobile transaction services. Again, this is C-SAM, the engineering talent that can work with our clients. The last, as I talked to Labs. If I reflect back, nobody's got mobile transaction services like we do, and nobody has Labs like we do. Those are unique and clearly differentiated.
In the end, we've got an awful lot done. All right? We reflected on growing the core, diversifying our base, building new businesses. Double-digit revenue growth, double-digit GDV growth, share gains. We're not going to let up. Innovation is key. Working with consumers and merchants, working with our extended set of stakeholders, experimenting with new technologies, exploring new data opportunities. You're going to see many of those things demonstrated downstairs in the product showcase. All right? With that, I'll conclude, and I'll turn it over to Craig, who will build on our core products.
Thanks, Gary. Gary touched on a couple of themes that set up the discussion about core products nicely, and I'm going to go into some of those in a little more detail. He talked about the strength of our core products business. He talked about how we're using differentiation and how we're leveraging innovation to help grow our core business. Those are all things I'd like to elaborate on a bit. Let me start a little bit with performance, the performance of our core business. The strategy that we're employing is driving nice results. You can see here through the first half of 2015, we have very positive growth in volume across each of our four core product areas of credit, debit, commercial, and prepaid.
Despite some things that you hear us talk about from time to time, some softness in some important markets around the world, we're seeing very positive volume growth. Importantly, along with that, both over the current period and over the last number of years, some significant growth in our market share. What's driving that? It varies a bit by product, but at the core of what's driving our success is creating strong products, leveraging the capabilities that we have been investing in developing organically or in some cases acquiring to put differentiated product into the marketplace, ensuring that our brand is delivering strong performance in the portfolios that we support, and working very hard to win with our customers around the globe. That's something you'll hear both Ann and Chris talk about a bit more. Just taking a quick run through each of the product areas.
With consumer credit, you'll see here that while our overall share trajectory has been positive over the last five years, the overall share growth has been a little bit more muted. That's driven by the U.S. and the situation with Chase. However, outside of the Chase situation in the U.S., the broader U.S. portfolio is growing very nicely, and we're posting really nice share gains across our International Markets. Chris and Ann will both go into that in a little bit more detail. In each case and in each of those markets, our consumer credit propositions are strong. We're delivering strong differentiated product into the market and using that to pick up share and engage consumers to drive usage and volume on our products. With consumer debit, nice growth across the debit portfolio from a share perspective on top of an already large base.
This is consistent across geographies, North America and our international markets, and is consistent across both single and dual message transactions. We feel good about the performance of our debit business. With commercial and prepaid, while both a bit smaller in terms of their absolute contribution to our business, the performance here has been exceptionally good. Both from a growth perspective and a share gain perspective. That's being driven by a couple of things. One is winning portfolios over to Mastercard of existing programs in the marketplace and working to use those product lines as levers to accelerate the migration of cash and check to electronic payments.
I'll touch on commercial in a little bit more detail in a moment, but for here, I'll just emphasize the growth that we have posted has significantly outpaced the market, which has helped us pick up some nice share. In prepaid, the growth that we've posted, which Gary alluded to, has established us at this point as the global leader in the prepaid space. At this stage, nearly half of all prepaid volumes are being transacted on Mastercard-branded products around the world. We feel great about that, and that's something we're going to continue to push to drive our growth going forward. Across these areas, we see lots of opportunity for continued growth. They are aligned with the areas you've heard Ajay talk about already. Continuing to win share in the already carded space.
We estimate in aggregate across these four product areas on a global basis, there's roughly $12.5 trillion of transaction volume already carded. We're working hard to increase our share of that and at the same time, working to migrate those 85% of the world's transactions that are still conducted in cash and check onto our network as quickly as possible. We're gaining share in a large and growing market, and we feel pretty good about that. I touched on differentiation, as did Gary in his remarks. These are the areas that we've been investing in to drive that differentiation in our core business in significant amounts, as Ajay referenced, roughly $5 billion over the last number of years, to help us differentiate ourselves across our spectrum of stakeholders.
That might be differentiating in the eyes of a consumer, in the eyes of an issuer, a merchant partner, or a government, all of which are obviously important to helping us grow the business. For example, and I won't go through all of these, but just as an example, in the area of safety and security, things like our biometric authentication capability, like pay with selfie that is on display today at the product showcase downstairs, helps deliver a really cool and unique and intuitive experience that differentiates us with consumers. Something like an enhanced authorization algorithm that enables our issuers to increase their approval rates for their most valuable customers when they're using our products differentiates us with that issuer.
Network-level capabilities that would help us, for example, detect and intervene in the case of a security breach of one of our partners can differentiate us in an entire category. Similarly, in digital, Gary's talked about P2P already. Mastercard Send is something that's also on display today at the product showcase. A very cool and intuitive way for consumers to transfer funds in a P2P capacity. Very unique and differentiating from a consumer perspective. Our credential management capabilities and chip technologies are differentiating us with merchants, for example, in the case of private label applications of that technology. Our Masterpass technology and the suite of capabilities it represents differentiates us with consumers, issuers, and merchants. As I said, I won't go through all of these, but they all have something in common.
They're all squarely aligned with helping us drive growth in share and volume and revenue in our core business. They're most powerful when they're deployed in combination, the bundles that Gary talked about, that help us put truly unique products and solutions into the marketplace. Let me shift gears then. I will just mention before I go off that slide, there's a couple areas that you see highlighted. These are the areas that have really been the focal point of our acquisitions over the last couple of years and are each areas that Kev and Kathy and I will go into in a little bit more detail. Turning to innovation. Someone told me that all I need is a shortstop, and I've got a full baseball team in this picture, which I didn't realize when I put it together, but it actually is true.
I also won't go through all of these examples because there's a lot here, Gary's touched on a couple of them already. I did want to take a minute to talk about how we think about innovation and its role in our business. It's easy when it comes to innovation to fixate on the bright, shiny object. While we certainly set our sights high in terms of the kinds of transformational initiatives we want to bring to market, the fact is that an awful lot of the innovation that we are bringing to market is close in to our core business and driving near-term results for us. You see in this diagram, close to the core, things that represent new combinations of products and capabilities that help us compete more effectively in the marketplace.
Gary touched on product line revamps with our Platinum product in Latin America. We've done the same in China with that product by using consumer insights to revamp the bundle of benefits associated with those products to align with the needs of consumers in those regions. Similarly, evolving our debit platform to enable its use in ways that are consistent with Islamic banking practices in markets like Malaysia and Indonesia have helped us in that respect. The next layer out is representative more of new technology, new capability that's helping us extend the reach of our core products. For example, creating an easy-to-use mobile app built by the developers who joined us through our acquisition of C-SAM, by the way. Pairing that with a financial education platform has helped us really set apart our solution for the Direct Express government benefits program in the U.S.
We're leveraging our loyalty platform to deploy a very simple and seamlessly integrated debit and credit proposition in Africa to help us go after a premium card segment through an easy integration, easy deployment across multiple countries. We're looking at leveraging combinations in things like our digital capabilities, Masterpass, and host card emulation, loyalty services, and our Advisors' portfolio optimization expertise to win business with important customers like PKO Bank in Poland. Then again, at the transformational edge, things that are a little bit farther out. You've heard us talk about some of these things in the past. Simplify Commerce is not new. In fact, it was on display at this event last year. As you know, that helps transform the online acceptance experience for small merchants. That capability will be available in 75 markets around the world by the end of this year.
We're excited with the progress there. We're leveraging things like our network capability combined with chip applications and contactless technology to transform the mass transit experience in markets like Colombia and India, even London, as Ann can attest to when she rides the Tube to work every day. Mastercard Aid, which I'll mention is also on display here at the product showcase. It's a pretty neat thing. It's a new solution that really helps government organizations, government aid, actually non-government organizations and other aid-based organizations, distribute aid more effectively, more efficiently, more flexibly to people in need in distressed environments around the world. We've piloted this in markets like Yemen and the Philippines. Other markets we'll be entering soon. It's a great transformation of a consumer experience in a very difficult environment.
It helps those aid organizations save money and helps us generate some revenue in the process. As I said, I won't go through all of these. You get a sense from this that innovation comes in all shapes and sizes. It's increasingly part of our DNA and is clearly aligned with things we're doing to help grow the business. I think our CEO just injured his foot somehow kicking something. He's distracting me from the front row. That's all right.
He's probably playing.
That's his prerogative. In any event, innovation's doing a lot for our business. With that as a backdrop, let me shift gears a little bit. I want to go deeper into two areas of our business. One is commercial, which is an area where we're seeing great success and results, in part through leveraging innovation like some of the things I've just talked about. The other area is loyalty, which has been an area we've been investing in to help enable innovation and differentiation. They also happen to be areas that many of you ask us about from time to time. We thought we would go a little bit deeper there. Turning to commercial. We've made great strides in our commercial business over the last several years.
As you can see here on the left side of this chart, both our volume and revenue growth has increased at a very healthy clip. I'll note, we're not just riding a rising tide in a strong market here. You can see across the bottom of that chart that our volume growth relative to the market has been consistently outpacing the broader market, and with that have come the share gains that I referred to earlier. It's growing and becoming a very nice, meaningful business for us. Notwithstanding that growth, there's still tremendous opportunity for us in the future. You see here, we estimate the addressable opportunity in the commercial segment to be about $19 trillion. Significant opportunity across each of the three segments that we think of when we talk about commercial with SME, T&E, and B2B.
The opportunity, not dissimilar in many respects to the opportunity in consumer, given the relatively low penetration rates of carded payments. In the case of commercial, those penetration rates are even lower at only 9% or 10% based on our estimates of the full opportunity. The balance here being primarily cash and checks. Again, we see tremendous opportunity here and a long runway for continued growth in the commercial market. The way we're going after that is by driving segment-based solutions that meet the needs of customers in each of these segments. In SME, for example, there's an initial challenge in some cases with SMEs of finding them. They're often hidden in consumer banking portfolios, we're working with issuer partners to find them and then ensure we get the right product into their hands.
Products that help with recognition, with control, and value, all things that are important to the small business owner to enable them to run their business more effectively. We're doing that with things like In Control for Business, which is a product that enables a business owner to set spending parameters on a card product, limit spending by day, or day of week, or time of day, by merchant name, merchant category, spending amount. A full range of ways in which a business owner can parameterize the program to give them a greater sense of control about how their funds are being spent. As well as other programs like Frequent Business Traveler, Easy Savings, our Small Business Toolkit, which is an online tool for business owners, and Simplify Commerce, which I mentioned earlier.
All of which in different ways help deliver value through savings or convenience, help small business owners save time, which is a very precious resource for them in running their business. We see with these products, when we get the right products in their hands, we see spending increases of, in many cases, up to 40% on these programs, which is very rewarding. T&E is all about policy compliance, reporting efficiency, and vendor management. We are working in this space both to win corporate accounts and work with players in the travel sector to electronify some of the wholesale payments that take place, for example, between travel agencies and travel suppliers. We're seeing good results with things like our Central Travel Solutions that use our virtual card technology and In Control for Business travel, which again provides data controls and streamlined reconciliation.
In B2B, huge opportunities in B2B, again revolving around efficiency, process efficiency, and vendor insights. We're seeing very strong growth on traditional products like procurement cards and fleet cards in the area of things like office supplies, maintenance and operations expenses, fuel expenses, as well as with virtual cards. Are working to identify some new opportunities to displace other forms of payment in some of the large B2B flows that we see happening around the world. In all cases, our commercial products are underpinned by a similar set of capabilities that are important. I've touched on some of the product differentiation, but in conjunction with that, our proprietary Smart Data platform that delivers analytics and insights to program managers and business owners, and our unsurpassed worldwide acceptance, which is obviously critical in the use of any commercial card program. These things are delivering results.
We're winning deals across the globe. I won't go through these in any detail, just to kind of keep us on track a little bit. You see here wins in every region, representative with large issuers, with large corporates, with governments, customers of all shapes and sizes using our commercial card programs. In many cases, because of some of those differentiated capabilities I mentioned, whether it's Smart Data or In Control suite of capabilities or others. Let me turn to loyalty and talk about that for a few minutes. This, as you know, is an area we've been investing in a fair amount over the last few years, the reason for that is straightforward. It revolves around two things. One is the capabilities we have in our loyalty business help strengthen our core business.
It helps us deliver more value to consumers, issuers, and merchants, which in turn helps drive growth in the use of our credit, debit, commercial, and prepaid products. Secondly, it enables us to participate in a pretty large and growing revenue pool for loyalty services, which helps in the revenue diversification of our business. I will emphasize that first and foremost, this is about supporting growth, driving growth in our core business. We're seeing evidence that that's paying off. When we look at the performance of portfolios that, for example, include optional benefits associated with them, things like insurance, we see increases in spending from anywhere to 15%-30%. When we layer in a rewards functionality on top of that, those increases can be 50% or more. There's real value in the capabilities these loyalty programs deliver, both for us and our partners.
Gary touched on the end-to-end nature of our loyalty portfolio. Loyalty can mean many things to many people, here's what we mean when we talk about loyalty. It's a suite of capabilities that includes benefits, insurance, rewards, and offers platforms that can be used by issuers or merchants to deliver against their particular strategic objectives in how they want to engage their customers and drive loyalty and increase their share of those customers' activities. This is a portfolio we've built both through organic investment and acquisitions over the last couple of years, it enables us to do a wide range of things. For example, things like delivering an affluent card program with the right bundle of benefits like insurance and travel services and customer service support.
Managing rewards programs for banks or merchants that includes features like being able to redeem points for purchases that are made anywhere Mastercard is accepted. Helping merchants target new customers or win share of wallet with existing customers by delivering the right sort of offers and benefits to them. In some cases, enabling merchants to deploy turnkey loyalty programs, complete with card programs, with points management, with points redemption capabilities, with program management, and program analysis. Gary touched on some of the numbers associated with this part of our business, so I won't go through that. As I mentioned, this is increasingly important in driving the growth of our core business. I did mention as well we've built some of our capabilities through acquisitions. Pinpoint was the most recent in the loyalty space.
This is a strong business, a thriving business that we acquired based in Australia, but with a presence in seven other Asia-Pacific markets. It is really providing us with deep expertise and capability in the loyalty space and execution capabilities to be able to complement our core business in that region. Just over a year after closing on that acquisition, we're seeing positive results. We're seeing increases in business with issuers and merchants. Important issuers like Cuscal in Australia, which Ann will touch on a little bit later, with Westpac and DBS, and with large merchants like Dick Smith, for example, in Australia, and others who are using these capabilities all in different ways to augment their own loyalty programs and extend the reach and value that those programs provide to their consumers. A number of examples here of wins, again, across the globe.
You'll see here issuers, merchants of all sizes. Again, I won't go through any of these in detail, but we do have a loyalty station as part of the product showcase, and we'd love to talk to you more about any or all of these examples or things that we're doing in the loyalty space with our customers. Just wrapping up then. We feel like we're well positioned to continue driving growth. We're delivering growth to date on the strength of strong product propositions and believe we're well positioned to continue that on the strength of the assets we've invested in or acquired and the innovation that's driving our business. With that, we'll be well-placed to continue displacing cash, winning share, and driving usage of our products that will fuel our future revenue growth.
With that, I will turn things over to Kevin Stanton, President of Mastercard Advisors, and he will talk to you a bit more about our information services business.
Sorry about that. Thanks, Craig. Good morning, everybody. You've heard Ajay and Gary and Craig now talk about how Mastercard is extending its reach and value. In that context, I want to focus on how Mastercard delivers insights to an expanding clientele through Advisors Information Services. It is with great faith that I press the green button. Information Services is part of Mastercard's fast-growing Advisors business. I've spoken to you about Advisors before and why Advisors before. How we enjoy a tremendous data advantage. How our three lines of businesses help our clients make better decisions with Information Services analytics. Find better approaches to their challenges and opportunities through Consulting Services and get better results through our executional capabilities with Managed Services.
How Advisors provides Mastercard with a competitive advantage against like-to-like competitors, and even more importantly, in the battle to convert cash to electronic payments, how Advisors provides Mastercard with a competitive edge against local switches and processors. By providing value beyond payments, Advisors is meeting the broader value chain needs of our traditional customers. Things like marketing effectiveness analysis, inventory mix, and even site location. Advisors is also helping Mastercard reach new types of customers like manufacturers and the healthcare industry and government, just to name a few. In that way, Advisors is helping Mastercard diversify revenue. Advisors drives customer engagement and operational reliance, or on a day like today, you might want to call that stickiness. I think the best testament to that point is that when Advisors is part of an overall relationship, that relationship will perform better on multiple dimensions than one without Advisors.
That's a very, very quick review of Advisors. I want to take the rest of my time to focus on Information Services for a couple of reasons. One, because that's how we usually enter a new vertical. Two, it gives me an opportunity to explain how our recent acquisition of APT and 5one enhance our ability to do just that. Let's take a look at how Advisors Information Services has been growing and where we're going to take it from here. Since 2010, Information Services has enjoyed pretty healthy growth, posting a 24% revenue CAGR, ex acquisitions during that time. While we touch a great number of verticals, the lion's share of that growth has happened in three. In the FI vertical or the financial institution vertical, Barbara, you told me not to use abbreviations.
Information Services has added over 200 new clients and expanded usage within the existing base. Growth has come from retailers as well. We've added, coincidentally, another 200, more than 200 clients during that time, and again, that excludes clients coming from the acquisitions. You might ask, what's going on with retailers? Primarily, the push is that we can help them understand a 360 view of consumer behavior. Let me explain that a little. A retailer will be able to or may understand how their consumers are behaving within their own four walls. Mastercard data can help them understand how those same consumers are behaving outside of those walls, and that's very valuable to them. Finally, we've scaled our offerings in the media vertical, doubling that business in the last couple of years by deploying self-service offerings through established distribution channels in order to accelerate expansion.
What's going on there? Well, here, we have a unique ability to provide insights that tie online behavior to brick-and-mortar purchasing, which is absolutely critical to understand how your campaigns are performing. I want to emphasize this before any of you get too scared. This is important, and I'll discuss why later, that all of Mastercard Advisors' offerings are developed with Privacy by Design. By that I mean we don't receive, need, or use personally identifiable information to do what we do. How do we accelerate info services going forward? Well, first, by scaling our work with retailers and expanding into new verticals like telecom, pharma, just to name a couple.
In fact, when you go to the product showcase, you'll find a couple of my colleagues who can walk you through a new offering that was designed for the commercial real estate vertical called Retail Location Insights. By the way, Retail Location Insights is the product of an employee innovation challenge that was run by Mastercard Labs, it was brought to market in under six months. Stop by, check it out. I think you'll like what you see. The second way we'll accelerate growth is by taking advantage of some important trends, one of those trends is the general democratization of analytics. Before you all get deflated, let me explain what the democratization of analytics is. Next time you're in Tacoma, Washington, and you're looking for the best sushi place in that city, come to New York.
No, if you're stuck in Tacoma, you're probably going to use an app, you may not know it, but you're actually using analytics built into the app and available to you at your fingertips. The same thing is happening within enterprises. No longer the preserve of specialists, analytics are now embedded into the day-to-day operations throughout the building and even outside. I'll give you an example. Take a delivery truck driver. She gets the map displayed on a screen, she's told what route to take and what order to do the deliveries in. That's easy. She understands a map. No big deal.
What she probably doesn't understand is that route on the map is the product of sophisticated logistical algorithms, yes, I said it, algorithms, that draw from many, many data sources and take into account things like distance, traffic light patterns, traffic conditions, road conditions, topographical inclines to maximize fuel efficiency, and much, much more. She doesn't need to know about that. She needs a map. Map's usually not enough for me. I usually need my wife with me, but she just needs a map. That's what she does. Two other trends you can draw from that example. The importance of automating easy-to-understand and easy-to-use analytics, the fact that analytics are now being embedded into day-to-day workflows. Finally, as I mentioned before, you will continue to see Mastercard Advisors leverage its solid Privacy by Design foundation as a differentiator, not just as an obligation. As a differentiator.
Consumers are sophisticated about privacy, and governments are more and more able to meet their demands in that regard. From our point of view, only those companies that have a strong privacy and data and information security footing will be able to create sustainable revenues in the data and analytics space. Our ambitions to grow, as I've described, and at pace, suggested that we needed to complement our organic activities with M&A as an accelerant. In June of this year, we acquired APT, which is a leading test-and-learn analytics provider with over 130 blue-chip clients operating in more than 10 verticals. APT offers a unique combination of cloud-based software combined with unparalleled client care. When you go to the product showcase, in fact, there are two of my colleagues, recent joiners from APT, who will be able to walk you through that platform, a test-and-learn demo.
The acquisition of APT complemented the November 2014 acquisition of 5one, which was a London-based analytics and consulting firm that focused on the retailer. They have 50 clients around the world, and 5one, like Mastercard Advisors, provides soup-to-nuts analytics, consulting, and marketing execution. Coincidentally, both APT and 5one, in partnership with their retailer clients, provide insights to Consumer Packaged Goods manufacturers, or CPGs, at the SKU level. That's a great new development. These acquisitions are based on the strength of these businesses themselves and the value that a Mastercard combination could bring through Mastercard's data, our brand, our sales force, and our global footprint.
What I'd like to do with the time I have left is explain how already in the short time since we acquired APT and 5one, that we have seen the acceleration of sales, we've seen the launch of products incorporating Mastercard data and analytics, and we've driven wins with our traditional customers. I'll start with 5one and de Bijenkorf. Since 2012, de Bijenkorf has been engaged by 5one and now Mastercard Advisors in designing and building a customer engagement platform called Privileged Membership. de Bijenkorf is the Netherlands' leading and a very smart luxury retailer. The four-year engagement began with classic consulting and then moved to design and implementation through Mastercard Advisors' extended capabilities. I can't get into proprietary specifics, but I can tell you that the program has been a tremendous success.
In the past 10 months, we've continued with the design and launch of an innovative loyalty program that delivers a more meaningful, personal, and convenient shopping experience to the de Bijenkorf customer. By the time this engagement is finished, we anticipate a four-year working relationship operating at a very intimate level with this client, which is exactly the kind of engagement and stickiness that I talked about. That's how a 5one engagement typically starts. The final step in a 5one engagement is to deploy 5one's easy-to-use, web-based analytics platform that leverages the client's own SKU data and converts it to recommendations that they can use to operate their business, things like inventory mix and the like. If the ecosystem is right for it, with the cooperation of the retailer, the same data is repurposed for use with manufacturers that work with that retailer.
In the end, Mastercard Advisors has been able to strengthen 5one's value proposition with our data, our analytics, our consulting, and our extended executional capabilities. We've also extended 5one's reach through the Mastercard sales force, through global relationships, and through other acquisitions like Pinpoint. In contrast to 5one, where we start with consulting in order to end up with an embedded analytics platform, an APT client relationship begins and ends with automated analytics accompanied by customer care that are designed to drive consumer engagement and expanded usage. Through Mastercard Advisors, APT's model can be expanded to include consulting and executional work. APT stands out from other providers of test-and-learn decision making in two particular ways. First, they match the control and test groups better, and second, they take noise out of the test, like weather, competitive promotions going on in a particular location, et cetera.
Just by way of a quick background, what APT does is they combine the customer's data with third-party data and now Mastercard data. They crunch it on their very, very scalable platform, and they return highly actionable recommendations to the customer. I want to talk to you about APT at Kellogg's. I'm using that phrase very carefully because remember, with APT, the client uses a platform. You know Kellogg's, I'm sure, and you should know Kellogg's is one of the most intelligent food manufacturers on the planet. Kellogg's wanted to introduce changes to its product assortment in select stores around the U.S. to try some new ideas. I guess sugarcoating on one side versus another. They first turned to the APT platform. I have to tell you a bit of a story. Before we bought APT, I attended a user's conference with 300 APT users.
These were very devoted devotees of the APT platform. So much so that they use APT as a verb as in, "My boss asked me if I APT'd the program before she'd talk to me." So it's very intense. Here, Kellogg's used the APT platform to compare test store sales to control store sales and measure the profit impact of the product changes, the true incremental impact at virtually real time. APT will be able to extend that value with Mastercard data to Kellogg's to help them understand the broader view of the Kellogg's consumers. I don't know, things like where do they shop when they're not buying cereal and that kind of thing. Today, Kellogg's continues to test new programs using APT, including shelf space optimization programs, pricing, merchandising, and operations. That's all I have time for now.
Please do stop by the product showcase to see how Mastercard leverages data. It excites me. I'm sure it will excite you. I'll just close by saying that these two case studies illustrate how Mastercard's accelerating progress with retailers and expanding into new verticals through acquisitions that complement our inherent strengths and our organic activities, and that are already delivering wins. Thank you very much for your time. I'm going to now introduce Kathy McCall, who will talk to you about the epitome of operational reliance and stickiness, Mastercard processing. Thank you.
Thank you, Kevin. Good morning, everybody. I had the chance, I think about two years ago, to come and talk to you about the investments that we were making in underlying infrastructure that was the work of processing. I'm delighted to have the opportunity now to come back and tell you what we've been up to in those last two years, and actually show you how the investments that we've made and will continue to make are really paying off and enabling our customers to access the innovative products that Craig and Ed are after. Let me just take a couple of minutes to look at the what's going on in the world out there that are really relevant in helping us to position why we do the things we do.
Garry talked earlier about this continued shift and the progress that's been made around the world in the shift of cash to electronic payments. This is clearly identifying, I think, for both ourselves and our customers, the continued investments we need to make in local infrastructure in order to enable the conversion of cash to electronic payments, particularly in the emerging markets. Add to that then the fact that consumers like us, businesses as well, are really jumping on the bandwagon of the shift to digital. This is really encouraging our customers and challenging them in so many ways to look at ways to create innovative new products that actually enable their competitive advantage in markets.
We look at all of the new entrants that are coming into the payments ecosystem and realizing that this means that they have to make their investments, but are more and more now looking to outsource their implementation work to access global scale, global technology infrastructure in a much more cost-effective way. Craig talked earlier about the compelling new propositions that he and his team are building across the world. He talked about utilization of new services like our loyalty services, information data analytics, the consumer benefits. We've got all of our omni-channel work going on as well. This is requiring us to focus a lot on how the work gets done to enable this functionality and capability.
Really it's our investments in processing infrastructure that really offers the choice to the stakeholders in the ecosystem to use our technology, global that it is, the global scale and reach that we have to get their work done more effectively to serve their consumer needs. You can see here, this is really the work of the value of the payments ecosystem around the world. In the middle of it, you can see the Mastercard switch, and this is our core business of authorization, clearing, and settling. As you look across the broad remit of capabilities and functionalities required to enable the new world, is why Mastercard is diversifying across that value chain and actually building out the capabilities that our customers need and expect from us in order for them to enable their compelling consumer propositions.
Here we see prepaid management services, Garry talked about that investment that we've made in the past. This is really the program management capability that enables us to obviously offer compelling propositions to our customers on the prepaid barrier. More and more to encourage new entrants into the payments ecosystem. Of course, the traditional business of cross-border travel solutions. The payment transaction services functionality, that's really enabling issuers and acquirers to use our infrastructure, our technology, and our services to process payment transactions across the world safely and securely. Finally, the payment gateway services, which is all about enabling this digital revolution, enabling merchants to accept payment transactions safely and securely.
Our acquisition strategy over the last number of years has really been aimed at helping us to fill capability gaps as we look at collaborating with our customers to identify conjoined needs of what we all need to do in order to enable execution. Craig and Kevin talked about the investments we've made in data analytics and loyalty. I'm going to focus on some of the others that we've done really inside the core world of processing. You see here, Access Prepaid. Really that brought to us the necessary program management capabilities that really supports the emergence of prepaid solutions globally, enables and brings more players into the ecosystem. We built IPS a few years ago, actually initially for U.S. debit solutions, but it's now the processing engine for Access Prepaid globally, and also is the processing engine for our mobile money solutions.
The Provus and Trevica acquisitions that we've done really is enabling our European customers just to access the functionality they need to deliver their compelling consumer propositions in market, leveraging our scale and innovation to get the work done. The acquisition of ECS last summer, actually, doesn't seem that long ago, that acquisition really was to enable us to access the really cool and well-renowned access to technology innovation, software engineers, and software developers who work with our global people around the world to create innovative products. We also, in addition to the innovation agenda that we can drive out of ECS, it's formed the basis of our standard processing services. Imagine how cool this would be. We build all of the innovation that Mastercard brings through its labs and its environments around the world, we build it once, and we implement many times around the world.
This is a very, very powerful proposition for our customers and also enables us to do things in a much more cost-effective way. ECS is also actually forms the basis of the new technology hub that we announced earlier on in the year, which will bring a whole talented pool of software engineers and developers to work with the global innovation teams in order to execute our technology agenda going forward. That's missing off this slide, we built MIGS, I guess, a good 2 years ago, to open the gateway in Asia, used the DataCash acquisition to give us more global reach. Again, on the basis of the standardized solutions that we have our aspirations to, we bought the TNS payment gateway services business of TNS in early part of last year, just from the turn of the year.
That really will form the basis of enabling us to build a global standard platform to enable merchants and acquirers to transact safely and securely across the world. Really the basis of this slide is to show that we're using these capabilities in ways that are very meaningful for our customers. We're touching the heart of what they need to do in order to execute on their work, enabling them to leverage our investments in new technology, and the scale of our infrastructure as well. This, I think I showed you this map two years ago, and I think you'll probably agree with me that this is somewhat of a tremendous performance, although I say it myself, in terms of this couple of years' difference. What a difference a couple of years makes.
We continue to drive now alongside our core network, of course, of nearly 50 billion transactions that we're switching around the world. We're acting out and performing processing services work for 107 million account holders around the world. We do that through now 65 markets. That then drives another additional 5.6 billion transactions across the network. Very fundamental and very important, as both Ajay and Gary stressed. This is the fundamental basis on which we can continue to add the value to our customers overall in terms of safety and security and access to service. Our local processing capabilities, and I'm stressing the word local because the core difference between the global network is you really want to do as much as possible, do it once, and then the whole world benefits.
The work of processing is much more local because you're touching the customers on how they want their work done. You're doing work on behalf of them. It's really a local essence, and hence the reliance on as much as you can get global technology and global infrastructure, but people locally who understand how to get work done on the business. That's the business of processing. Our Prepaid Management capability has really been a significant contributor, Gary talked about this, in just dramatically enabling us to grow our Mastercard prepaid solutions around the world. The issuer and acquiring processing functionalities really then allows us to see more transaction data beyond our switching, which then enables us to enrich our data quality and to provide those value-added services that my colleagues have spoken about already.
Finally, the Payment Gateway Services really allows us to get closer to issuers and to merchants and transform the overall value proposition there. We're really excited about the emphasis that we're putting there and also the returns that we're getting. I think we're clearly focused on our existing customer base, but we're also really looking at ways to support new customers really coming into this payment ecosystem. Let me give you just a few examples. I think the examples here really probably underlie why I love what I do. I love what I do because I can really tangibly feel and touch the benefits that we and our customers can make together in this payments world. Let me talk a wee bit about Qantas first.
Qantas, as we all know, Australian airline, they've got a pretty sophisticated frequent flyer program, they wanted to bring new functionality and new use to it because they wanted to bring new members onto the program. We worked with them to build a very innovative loyalty and payments card together that really changed the dynamics of how their members interact with them. It provides them with the functionality to store foreign currency because they're already planning where to fly. It enables them to access cash all over the world. I guess in addition to the frequent flyer points that they earn, they earn frequent flying points on everything they spend. Their CEO, and I love the way she phrased this, their CEO brought this to life in saying that the feedbacks from their members have been absolutely fantastic.
When you consider all the different things that this does, it really is the Swiss Army knife of cards. It really is just exactly what it is. I'll take Shinhan Bank now, because Shinhan Bank is the largest foreign currency banknotes provider in South Korea, a very nascent prepaid market. We've worked with them to enable them to use prepaid solution to offer their consumers access to foreign currency in a far safer and much more secure way. Moving across into payment transactions, I'm going to talk a little about Green Dot. Now, Green Dot is the largest prepaid, reloadable prepaid card, and cash reload processing services across the U.S. They have a huge, what they call their branchless network that they deal with in terms of distribution. 100,000 retail locations. They work with 25,000 of the tax preparation services. They work with online tax preparation.
They are online themselves, they're in the app stores. Generally, a very broadband distribution of very different products and services. Their challenge was really access to the right technology that can offer the diversity of solutions and services that they need in order to enable that, and they've chosen Mastercard as the network processor and also their network gateway as well. Access to that in a more and more cost-effective way. The Home Retail Group, moving over to payment gateway services, you might know them more by their brand name. That's like Homebase, Argos, Habitat, are all part of the Home Retail Group. They're really interesting digital case study there. What they wanted to do was to enable an end-to-end consumer experience that was second to none. They, in reality, wanted to move their digital payment experience inside the store.
We've worked with them to enable that for them. A couple of benefits that came out of that that are really driving significant competitive edge for them, and not only is it the digital consumer experience, but it gives them a single view of customer data across all of the group. Very powerful, as Kevin was mentioning, in their ability to target and be very specific around consumer propositions that they can offer to them. I've got Ecobank up here as well. Ecobank is a Pan-African bank. Their challenge was acceptance across 20 countries in Africa. We're working with them, utilizing our mobile point-of-sale technology to enable them to drive acceptance in the markets that they choose to serve. It's not up here, actually, and I'm looking at the time, I don't have much time here, it's not up here.
Being a very fashion-conscious lady, I wanted to tell you about the work that we continue to do with the e-commerce and real lifestyle brand now that is ASOS, a startup about 10 years ago and now leading in their field. I love what we have done for them in enabling their digital commerce platform to serve their customers in many, many geographies around the world. Incorporated into that, of course, as we look at inclusive solutions, is the Priceless campaign that we have added that is continuing to drive more and more loyalty for their customers. Let me just finish up with a few key points here.
The first one really is in looking at what got us on this journey was really the strategies that had been described already and over the last few years as well by Gary and Craig and Kevin and my other colleagues, really required us to diversify our capabilities beyond our core work of switching. To support our customers to get done what they need to get done to access our capabilities and really to support them through the execution phase. These additional capabilities that I've spoken about alongside our core network really supports the revenue growth across the services spectrum that we've talked today, enabling loyalty, enabling our safety and security strategies, and also our information services capabilities. We've built out significant functionality, we've used acquisitions to really fill the capability gaps that we identified alongside ourselves and our customers in order to get into execution phase.
Very finished point here is as we drive our strategy, particularly in financial inclusion, our investments enable new entrants to come into the ecosystem, new markets to access our infrastructure as everybody works towards the drive to electronic payments. I think I'm perfectly ready to say that processing is the foundation of our enabling infrastructure and is a very core ingredient for accelerating future growth through the use of services in developing compelling propositions. Thank you for listening to me, and I'm now going to pass over to Chris McWilton, who's going to give you a perspective on our North American Markets.
Thanks, Kathy.
Ooh.
For a Scotsman to follow a fine Irish lad onto the stage. Good morning, everyone. Thanks again for coming and thanks for your continued support of our company. A little bit of nostalgia as I walked into the Exchange today because it was just under 10 years ago when I had Martina's job, we rang the bell here and took the company public. Sometimes I think in the day-to-day firefights and dealing with customers and issues and digital wallets, et cetera, you lose track of how much progress you've made in a very short period of time. When we rang that bell, we were valued at $5 billion, and we went out at $39 a share pre-split, which is now $3.90. We've got a great team. It's an incredible business. It's a great industry, and it's a great time to be in this industry.
I firmly believe we're going to see more change in the next five years than we've seen in the past 50 in this business. Fasten your seat belts, more to come, and hopefully we can do the same thing with the stock price. Obviously, you'd all be very happy with that. Anyway, being in North America is actually a great place to be in payments right now in particular. Obviously, Ann's world is experiencing all kinds of great growth and opportunities as they develop. I'm excited to be right here in North America.
If you look at the digital giants that are starting to get into this space, whether it's Apple or Google or PayPal, whatever the case might be, they're all sort of sitting right in the United States, and they all are trying to get into the evolution and the migration of cash and check into electronic forms of commerce. The new wallets that are coming out are being launched here in the U.S. It's a great place to be. Safety and security is top of mind, too. We're going to be coming up against the liability shift for EMV in just a few short weeks. Javier laughs at me every time I talk about that. He says, "What the hell is wrong with you guys in the United States?
It's taking you 50 years to get on the chip." We're getting there, and we are committed to the liability shift date. We're not wavering on that if there's any question. As you heard this morning, whether it's issuers or merchants or governments, everybody's looking for different ways to drive their growth forward, and some of the new services and products and companies we've acquired have enabled us to help them grow their top line as well. With that, let me take a quick tour around North America for you and just put our business in perspective. Obviously, we're still navigating a pretty difficult economic climate. We've seen fluctuating fuel prices. We've seen regulatory intervention on both sides of the border, most recently in Canada, the voluntary interchange cap. We've seen a strong U.S. dollar.
Those are things we can't control, but that has significantly impacted inbound cross-border, which is a very profitable source of volume for us. The consumer, I believe, remains cautious in terms of their spend. Over the weekend, you heard reports that gasoline prices were the lowest over Labor Day in 11 years, but we're not necessarily seeing consumers take that savings and spend it on an extra week of vacation or an extra purse or a pair of shoes, whatever the case may be. They're still very cautious. We've yet to see whether consumers have been spooked by what's happened in the markets over the past few weeks, the pretty wild gyrations in market and I think we're technically in a correction right now. You have to see where that's going to shake out.
Despite all of this, the ups and downs, this business in the U.S. and Canada is strong, it's consistent, and it's resilient. In fact, we have delivered 12% compound annual revenue growth for the 5 years ended 2014. Through all the cycles and the economic crisis and the fuel prices and the Ukraine situation, this business just chugs along. Our region, U.S. and Canada, is a significant contributor to our overall profitability. It's just about 40% of our total revenue. The U.S. and Canada represent 2 of the top 5 markets in which we operate, and we represent about 35% of worldwide volume. Looking forward, things continue to look positive, and I think there's a lot of runway left in this business, even though we call ourselves a mature or a developed market from a payments perspective.
PCE is expected to grow upwards of 4% going forward, and there are still huge swaths of cash and check In areas like healthcare and rent and utilities that we're going after and are going to get across our network. Like Ajay said earlier, our strategy remains to diversify our revenue, grow our core business, and build and sell world-class products and services to a whole new set of customers, not only in the United States but around the world. I mentioned strong, consistent Let me get the clicker to work here. There you go. I mentioned strong, consistent revenue growth. The question is, how are we doing it? Well, first and most importantly, and I've talked about this for several years now, is revenue diversification.
Our business for many, many years, the legacy business of Mastercard in the U.S. was built on consumer credit cards issued by large monoline banks. That served us very well for a long period of time. We went through the economic crisis. Monoline banks fared less well than the more retail-oriented banks, and we realized we have to diversify our revenue base. We have that now. We've got a much broader product mix as well, as Craig mentioned. We've got credit on the consumer and the commercial side. We've got debit, we've got commercial, and we've got prepaid products as well, making up bigger portions of our revenue. We've also made great progress in the co-brand space, which I've talked about before.
In fact, we're now ahead of our plans to have co-brand wins make up for the lost Chase volume, and we now expect that to happen by the end of this year, 2015. Great progress in the co-brand space. Our customer mix is changing as well. While we do business with the traditional large banks and large merchants, independent banks and credit unions, governments and the digital players now are making up a greater share of our revenue. In a few minutes, I'll share some of those recent wins. Kevin mentioned strong momentum in services. These are all great things that we can bundle with a deal when we go out to a merchant or an issuer, or a co-brand partner and complement our core switching service, our brand, and provide us an opportunity for hopefully some value-added pricing. We've got existing core services.
We've got loyalty and information services. We've added C-SAM, we've added APT. C-SAM gives us the ability to launch mobile applications for our customers, whether it be banks or merchants, in the mobile payment space. APT, Kevin spoke about giving us a differentiated solution and a reason to go into a merchant and have a much different dialogue with them than the cost of acceptance. It's a much different dialogue when you're talking about how to drive their top line than whether interchange is 180 or 200 basis points and how you get it down. It's changing the tone and obviously complementing what we're trying to do to diversify our revenue. Our world is changing. There are ever-evolving technologies. You're going to hear from our technology team, Ed McLaughlin and company later on, and Garry Lyons.
What we're trying to do is make sure that consumers have the same experience in the mobile world, whether it be on a watch, in-app, on a phone, whatever the case might be, that they've had in the physical world, and make sure that Mastercard experience is still robust. You're going to see a lot of those things down in the product showcase. Let's take a closer look at some of the wins we had this year. Solid start to 2015, although we're now into September, so I guess it's not a start anymore. We're coming down the three-quarters pole here. Solid year with some big wins, some marquee names. First and foremost, Citibank. Our Citi win. We secured a long-term partnership with Citi, which is the world's largest credit card issuer. It's a global deal.
It touches all of our regions, including Ann's, and they're a very important strategic customer for us, and we're going to work closely with them to drive their business in all parts of the world. We also extended our agreement with Barclays and packaged a lot of the services you've heard about today into that agreement, including acceptance and issuance of Masterpass. Up in Canada, we've renewed several large issuer deals up there as well. Talk about independent banks and credit unions for a second. We call them IBCUs in our lingo. We have a dedicated IBCU team, and over the first part of this year, we've won several high-growth accounts, namely First Tech Federal Credit Union, which we've worked very closely with in developing some leading-edge technology. I'll explain that shortly.
First Tech is a great partner of ours because they serve high-technology companies like Hewlett-Packard, Microsoft, Intel, Cisco, Amazon, and the like. They're great. They're in the right part of the valley for us, give us a West Coast presence, and we're able to do some neat things with them. We're expanding our business in debit as well. We recently run the pin debit business, I call it the back of the card because it's not branded on the front, the back-of-the-card business with TD Bank, and we've done several other deals in the pin debit space, including a flip from a competitor that'll also be using our IPS debit processing platform. Prepaid front, our anchor client there is the Direct Express program, which we renewed. It's basically the Social Security program for anybody who's a Social Security recipient that does not have a bank account.
They receive their benefits on a prepaid card. We renewed that. It's the largest government benefits program in the world. On the commercial side, we continue to do very nicely. We're winning with Bank of America and helping them support some of their new customers, as well as other large issuers in that space. The core business is strong, it's growing, and we're winning profitable business. I mentioned co-brands earlier as one of our factors of success, and we're continuing to see a lot of movement in this space. We know we won't win every time. It's a very competitive marketplace. Since 2013, we've really focused on it, and we've won over 40 co-brand deals both renewals, flips from competitors, and new entrants or new players in the co-brand space. From just the flips alone, over $500 billion in volume on those deals.
A little focus has paid off in a big way. We won Costco in Canada. We didn't win Costco in the U.S., and what we're seeing is over the past few years, the large merchants have been using their scale to extract economics similar to the way large issuers have done for many years. They're hiring consultants. In just about every case, they split the network decision from the issuer decision. We continue to exercise financial prudence on how far we'll go to win these deals. Some deals, we will just say, "This doesn't work for us," and we won't go any further.
Again, when we're able to bundle services, like Kevin and Kathy mentioned, and you'll hear about in the product showcase, hopefully you get a chance to spend some time there, we can bring differentiated solutions to our co-brand partners and continue the winning momentum. We're proud of our success in this space. You will be hearing about more wins in the near future, so stay tuned. Let's turn to innovation because this is the hotbed, this is the epicenter of payments innovation, I believe. I think we need some innovation on the clicker here.
Somebody in the back.
Somebody in the back press the button. There you go. Like I said, I don't think there's a better time to be in payments right now. We're in the middle of what I call a wallet palooza with Google Pay, Apple Pay, Samsung Pay, you name it, everyone's got a wallet. Our money is on Masterpass. It's our wallet strategy, but it's more than a wallet. It's a platform. It enables you to deliver loyalty and solutions and rewards, et cetera. We've had great momentum on both the issuance and the acceptance side. In the U.S., we've recently added U.S. Bank, National Bank in Canada, up north of the border, Navy Federal Credit Union, and SunTrust are going to be issuing our Masterpass wallets. We're also building out acceptance. This is a chicken and egg game.
You have to have issuance, you have to have acceptance, we're doing that. We just announced Burger King, Carnival Cruise Line, Roots Canada, WestJet, again, up in Canada, Wayfair, we now have 250,000 merchants that accept Masterpass globally. Watch your television, read the paper over the next few weeks because we're launching a national advertising campaign around Masterpass, both in the U.S. and Canada. I said while our money is on Masterpass as our wallet, we're continuing to support the rollout of other wallets. We want to play with the digital giants in a meaningful way and a thoughtful way. Apple Pay was announced exactly a year ago today, I think. We launched that. Samsung Pay and Android Pay are now rolling out.
It's just important to remember that these wallets, while they're branded Apple Pay and Samsung Pay and Android Pay, et cetera, they run on our platform, our Masterpass digital enablement platform, which also fires up Masterpass. That's on the Masterpass front. We continue to keep merchants front and center. We discussed C-SAM earlier. Down in the product demo area, you'll see some applications they've developed in the retail, the fuel, and the government sectors. On the personal payment front, I think this also represents a great growth area for us. It's an untapped segment of the market. There have been various parties that have tried to get together to develop the ubiquity you need to have. Thanks, Ivan. Thank you. Thank you very much. Ubiquity to have a meaningful person-to-person payments network.
We have Mastercard Send, which enables access to virtually all U.S. debit cards in the United States, whether they're Mastercard branded or not. We can get to our competitors' cards, we can get to our cards through Mastercard Send. Google is actually leveraging Mastercard Send platform for their push in the P2P space. We think there's great opportunity there. It all leverages our network and the great job our guys do in technology. Talk to security for a minute, safety and security. We're leading the way here with new standards and new solutions both in the physical and the digital world. I'll give you a quick update on EMV. It is coming next month, the liability shift. I'm going to tell you, we're holding firm to that date.
We have had pushback from various parties as expected. It's time for this train to get off the station and get us onto a technology that is much more secure, at least in the physical world. I think the ecosystem is making great progress on the migration to chip technology. The Secure Payments Task Force, which we formed, estimates that half of all cards and half of all terminals will be chip-enabled by the end of this year. That's good progress, and we'll see the momentum continue as terminals get refreshed and new cards continue to get issued. One word I do want to make because there is a fair amount of controversy and dialogue about it in the industry is the view of whether chip and signature is preferable over chip and pin or vice versa.
I want to make it clear to everyone that our position is we are agnostic. It's up to an individual issuer or an individual merchant to decide which way to go based upon their particular facts and circumstances. We don't force, we don't mandate one or the other. What we do do is recognize in the liability shift that if you've invested and go through the effort of the higher security protocol, you will get a benefit in the liability shift. We're agnostic. We don't favor one versus the other. We're also the first in the virtual world to develop tokenization services, and our protecting the payments space also extends into the ATM channels. We've got SafetyNet, which is now in place in over 90% of the banks in the country.
It's an additional layer of security over and above what the financial institutions have already in place in their back office systems. That's going to be rolled out to the point-of-sale system within the next year. We're the only payment network that offers free of charge ID theft protection. If you have a chance down in the product demo area, I mentioned First Tech Federal Credit Union, or credit union, Selfie Pay, so biometric authentication. We rolled out with them and piloted them a few weeks back. Leading the way in safety and security, if you don't have the confidence of your customers, if you don't have the confidence of consumers, you don't have a business. This is top of mind for us, and I think we're making great progress.
I'm going to wrap up and get you to the break as soon as I get the clicker to win. I think overall the business is performing very well. As I mentioned, 12% compound annual growth rate for the five years ended in 2014. 2015, there are some things beyond our control that are tempering our growth. Lower fuel prices, while good for a consumer, they're not spending it, so we're seeing lower volumes caused by that. The strong U.S. dollar, and we have the renewal of a large issuer deal, which Martina and Ajay have talked about on the call. A few headwinds we're dealing with, but overall, I believe this business has a lot of runway to it. We're winning. We're winning profitable business. We're investing in the future and in the evolution of the business and payments from the physical to the digital world.
We've got a great team. The right place, the right people, the right time. I'm bullish on it. I keep reminding myself we operate in the largest economy in the world. We're the epicenter of payments innovation, and we delivered strong revenue growth consistently in a very dynamic and a very competitive marketplace. Again, thanks for your time, and I'm going to have Barbara come up and take you to the break.
48 seconds this time. Chris, you win the prize.
I win the prize?
You stayed on time. We are running a little late. We have a 15-minute break scheduled, so we are going to start again promptly at 10:40. For those of you in the room, out the back, the beverage tables have been refreshed. Restrooms are directly across from the coat check, and we'll see you back here in 15 minutes sharp. Thank you.
Shall I start talking? Does everyone want to come and take their seats, please? Haven't even got Martina here. I can't start.
Okay.
Well, I'm sure everyone's feeling reinvigorated after the break. I used to work in the offshore oil and gas industry. This session and working on an oil platform is the only place I don't have to queue for the bathrooms, actually, so it's great. Every year it's the same. Anyway, it's my great pleasure to start talking about the really interesting part of the day, really, which is all about the International Markets. I was just talking to somebody before the break who was saying to me, "Boy, is the world changing or what in the last two years?" The answer is, yes, the world is changing, but our business continues to thrive and grow no matter what seems to be happening around the world. Moving to the first slide. I will when I hit the button properly. Can somebody change the slide?
Thank you. We'll start immediately with the numbers. I know you guys love numbers. Chris talked about that North America was about 40% of the revenue, 35% of the world's GDV. By subtraction, International Markets, 65% of the world's GDV. You see here how it's distributed around the world. You'll see that Asia, Pacific, and Middle East and Africa are now the lion's share. Latin America, smaller volumes, good revenues, though. One of the things to say is look at the growth rates. Around the world, we're between 15% and 16% in terms of GDV growth. I just don't know sometimes how Europe manages to hit these numbers, Javier. Javier keeps telling me he's now chatting to Ajay Banga and not paying attention. Javier keeps telling me that it's all due to his brilliance, but I'll show you later what's really going on.
PCE continues to grow around the world. I mean, Ajay spoke earlier about the pace of growth in the emerging markets outstripping the developed markets, and hence the 85% cash. It's much more of a cash story in my markets. Look, it's about 91% cash in Asia and in Latin America, and it's even 77% in Europe, thanks to places like Germany, Martina, that are still ready to adopt. You know, electronic payments at some point in the future. Fantastic. Garry and Ajay talked to you about grow, diversify, and build. What I'm going to talk to you about is really this strategy in action, and I'm going to take you on a little tour of the world now. Next slide, please. What's the matter with my thumbs? It's like when I come through JFK, my thumbs don't print properly. Anyway. Okay, here we are.
What's going on? Europe, a lot of challenges, a lot of opportunities. The economic environment remains quite difficult, but as I said, our business is powering up with 16% growth. We've seen a change in the regulatory environment, taking that in our stride, and we continue to grow. Nationalism. Last year, we talked about Russia. We told you that actually Russia would probably impact our business by less than $50 million a year. Actually, that's exactly what's happened. Our Russian team have been signing more and more deals with the big Russian players. It's a good news story on Russia. Changing competitive dynamics. Well, this refers to things like the Visa put, which could happen this year. I'm not going to say much about that now, but you can ask questions, and Javier actually has a European session after lunch.
If you're interested in discussing that, fine. One of the great things about the opportunity side is the regulatory environment is creating more of a level playing field. We'd still like to see the likes of PayPal in there, but that's good for us. We're doing more and more merchant business across Europe, and I'm going to talk to you about that on the next slide. I've talked to you about the 77% cash. Europe is a really attractive market for us. Look, it's got $11 trillion of consumer spend, and that's about a quarter of the world's spending. It's also got 26% of the world's e-com business. Whichever way we look at it, this is a market where we're going to continue to thrive and grow for the future. What's really driving the growth?
Well, the good news is that all of the great things that we're buying are allowing us to bundle products and services to create this superior business model, which allows us to win deals. We went public. As you know, Chris talked to you about ringing the bell all those years ago here. We went public a while ago, and we brought our European business in day one. This means we are the only global network of our type in the world, and that makes a difference with the way we do business in Europe because when we do business with big issuers in Europe, we tend to do business across many different geographies. A great example of that is a deal that we did recently with UniCredit, where we signed up a five-year deal spanning 10 countries with them. That's a classic European deal.
Also, apart from dealing with traditional issuers like them, we're also very, very attractive to the cool new players, the sort of people you have in the U.K. market, like Metro Bank, and also like Virgin Money, which is absolutely fantastic, and I'm really looking forward to getting one of their cards with Anarchy in the UK, the Sex Pistols. Fantastic cards, in case you haven't seen them. Yeah, Ajay Banga just rolled his eyes there. That card barely made it through the firewall, I have to say. Anyway. Merchants. Wonderful merchant business we've got across Europe, and we are diversifying with merchants. One of the things I love is Carrefour, for example, has been a brilliant relationship for us. I nip off the plane in Milan, and I can use my contactless card to buy something in Carrefour in Italy.
That's the way that Europe has rolled out. Not only that, we're building strength with the digital giants. You know that we've launched Apple Pay in the U.K. I can use I can't remember, was it Gary Flood or somebody said earlier that I can use Apple Pay to go on the tube. It was probably Craig Vosburg. Go on the tube in London. Fantastic. Actually, transit, we're looking at around the world. Why are we so interested in transit? Well, the spend on transit is something like $518 billion a year. Huge number. I'm talking across the IMK world, and 42% of that is still cash. There's an enormous growth to come in that area, and we are hitting that growth strongly in Europe. We're already out there with contactless in the metros in St. Petersburg, in Moscow. We're working with Masabi.
We brought up the ability to buy train tickets online in Athens. This is the kind of thing that we're doing, and the whole mobile ticketing space is a big growth area going forward. I'm confident with all of the things that we're doing and the things that you heard from the product group from Kevin Stanton. Mastercard Advisors, by the way, Europe is our biggest users of advisory services. We rolled out SafetyNet across Europe, our fraud solutions, probably one of the first rollouts in the world. All of these things are combining to give us fantastic strength, which is why our future growth is really all about expanding acceptance, winning more deals, processing, because still in Europe, we're seeing less than half the transactions. So think of the growth that we've got there if we touch more transactions.
We're really differentiating our product and going for digital acceleration. So that's the European story. What's happening in Latin America? It's great because apart from Javier Perez here today, I've also got Gilberto Caldart, who runs my Latin American region, and he's here to answer your questions at lunch also about what's happening. There is macroeconomic slowdown. We're seeing that in big geographies such as Brazil. We've seen Venezuela really contracting this year because of the change, the devaluation of the currency, the control of foreign exchange and so on, hitting the cross-border traffic. On the other hand, there are other countries in Latin America that are really moving in a different direction.
For a start, there's a massive amount of cash, over 91% cash in Latin America, and some of the governments are really stepping up saying, "I want to change that." An example of that is the Uruguayan government has said that they're going to give a 2% VAT break on anybody who uses electronic payments. This is the kind of positive action that can really change the way things are in Latin America. The other thing is, you probably saw from Kathy's diagram that it was only really in Brazil that we were switching traffic. Everything else was open for new business. We're really starting to double down and focus on switching in the other countries. When I say the other countries, we're continuing to make inroads in Mexico, Colombia, Chile, and these kind of things Gilberto can cover with you.
That's the things that are changing in Latin America. What's really happening on the customer side? Well, Latin America, like many parts of the emerging world, are starting to really change the whole acceptance landscape. Because in order to reach the commercial business with small to medium-sized players that Craig talked to you about, you've really got to have a different acceptance model. The traditional acquirers, they don't really hit it there. What we've been doing is we've been working with payment facilitators across places like Mexico, and by the end of the year, by working with 20 different payment facilitators, we're reaching 100,000 new sub-merchants in Mexico. Not only are we just reaching them, obviously, with the traditional methods, but we're actually rolling out and bundling prepaid with MPOS solutions.
All of those new digital capabilities combined with the traditional product are reaching the end points in that way. In Latin America, financial inclusion is a big story because there's 300 million people excluded from the financial system, and that's a pretty big chunk of the continent. We've got 18 programs there. We've got them with traditional players, we've got them with new players. You heard me talk about Bansefi last year, a big player in Mexico again. Well, they're rolling out 6.5 million cards, which will really impact financial inclusion there. What about transit, everyday spend? I think the mayor of Bogota was the one who said that really an advanced city is not where the poor drive to work. It's where the rich use public transport. I think it's kind of funny when you think of America, but okay.
The thing is that we're working with transit systems around the world to do exactly that, to enable everyday payments across public transport. In this case, we brought up contactless capabilities on the buses in Colombia. Very soon, the London taxis will accept your card, and maybe London will become one of those sophisticated cities at long last. These are the sort of things that are working across Latin America. Now on to Asia Pacific. Well, economically, still very challenged. You've got cross-border impact, especially with FX headwinds happening in Asia. There's the normal regulatory pressures, countries looking at nationalism. But apart from that, we're preparing in the Chinese market, and I'm really pleased today to have Dennis Chang with us, who's going to talk to you a bit more about what's really happening in China.
I must say his English is a damn sight better than my Mandarin, that's probably His English is actually perfect. It's not that my Mandarin's nonexistent. The thing is, the Chinese Domestic market opening up is a challenge to us because there's a lot of things for us to think about, but it's also a fantastic opportunity for us. When you think of the size of China, the growth of China, the sophistication of China in many ways, a big e-com market with the big e-com players. I think it's sort of 10% of the traffic now is e-com in China. A tremendous amount to do there. China is obviously one side of the Asian story. India is another great side of the Asian story, which is really driving change. Especially with the new government focus on inclusion, digitization.
You've heard a lot about that. The sort of things we're doing in India is partnerships with the big trade body that reaches something like 60 million traders across India. We've been recognized by the finance minister for working with these guys to try and create a new payments landscape for the country. The good news for Asia is that the latest World Wealth Report has said that Asia has just overtaken North America in terms of wealthy individuals. That's an interesting statistic. What it is doing is driving our affluent portfolio growth across the continent. You can see that all of these trends are having a massive impact. Asia, by the way, has 92% mobile penetration, which means that many of the products could be mobile first in the future. What's really happening?
I think Craig probably mentioned through the Pinpoint acquisition that we've won the Cuscal deal. Cuscal is very interesting. It's a business that actually spans the whole of Australia and deals with 100 credit unions, banks, and building societies. We've done a fully integrated package service for them because they offer an end-to-end payment capability. That's in addition to winning deals with Westpac, Air New Zealand, Malaysia Airlines, people like Central Department Store, which are effectively the Harrods of Thailand. A lot of very good core business being driven out of Asia because of the acquisitions that we bought as well. On top of that, we're working in the mobile space. I was talking about mobile first. Mobile penetration in Thailand is 100%. 77% of consumers in Thailand can use the internet through their telephones, their smartphones.
Card penetration is only 30% on the credit card side. You can see that in order to really grab the business in Thailand, you have to go for a digital strategy first. What we've done there is we're working with TrueMove, who are a big telco in Thailand, and we're using our virtual card technology to actually allow people to use their telephones to buy online, to do the e-commerce experience. We're also combining that with prepaid. This is the reason why you've got things like prepaid growing in a very rapid way in many parts of the world. It's starting to become a preferred product in some geographies ahead of, say, debit. Very interesting. Future growth in Asia is also going to come from the SME segment. India is a great example of SME growth across the geographies.
Also you've got fantastic mPOS players there. I think we've just reached 32,000 new SMEs working with just two mPOS players in India. The market is sometimes concentrated in the digital space, and it allows you to grow. What about the Middle East and Africa? Listen, you can't talk about Middle East and Africa without mentioning the geopolitical situation. There are some tough markets. We all watch the TV. We have seen the exodus of people from Syria into, well, mainly up into Europe. This is not an easy situation that we're in here, and it's a challenging one. Still, Middle East and Africa is our fastest growing region in the world. The reason is that it has some very wealthy geographies, and we're working with governments in that area to put in whole new ecosystems in places like Egypt.
We're also looking at new payments options that are emerging in places like Africa. I'll be describing some of those on the next slide. In addition to that, because of things like the refugee crisis that you're seeing, we're also working with aid organizations and have been for quite a while. Downstairs, you're going to see our MCAid demonstrations, which are marvelous and allowing organizations like the World Food Programme to reach out and to give electronic means of payment to refugees to be able to buy things when they're not in their home country. These trends are all affecting our business in the region. If I look at what's actually happening in terms of cash displacement, as I said, massive government engagement on financial inclusion. You've heard stories in South Africa, you've heard them in Nigeria.
The latest one this year is that the Kenyan government have decided that every Kenyan over the age of 18 is going to have a card. It's a Huduma Card. They're going to be able to both pay and receive on these cards. They're going to be able to receive government benefits. They're going to be able to pay their taxes, their government tolls, everything to do with that. It is going to revolutionize the way that payments occur across the country. We know that Kenya was one of the first markets into the mobile space. The fact that they're taking this action is really exciting. Kathy mentioned ECS, which is an acquisition we did in India. It's allowing us to build processing capabilities around the world. We've built a processing hub in the UAE, and we're starting to deploy services from that.
We're bundling services with our Mastercard Advisors. We've got lots of new go-to-market strategies, whether it's at the upper end, the very wealthy end of the market in certain parts of the Middle East, or whether it's in parts of Africa, where we're working with banks who've never really done card business before. We're having to give them a full end-to-end service, which is called Card in a Box. Now, Ajay often has said to me in the last couple of years, "When the heck is this card going to get out of the box, Ann? You've been talking to me about this Card in a Box thing." I'm doing this because he's talking to Kathy again. A Card in a Box thing, and he said but the truth is, it's out of the box, Ajay. Boing.
We sold 30 deals in the first half of the year, fantastic growth. I think the runway in MEA is going to be wonderful. By the way, I'm going to start coughing now so they can give me some water or maybe a gin and tonic. We'll save it till later. Ice in a slice. Sorry?
A gin and tonic.
Oh. I'm teasing. Anyway that's the story across Middle East and Africa. Have I overrun time, or am I two minutes ahead?
You're two minutes behind.
You know what? Anyway, okay. The thing is, we started about growing, diversifying, and building. I think the message here is the world is becoming a more complex place geopolitically. However, the pace of growth across the markets is accelerating, and the secular shift is accelerating, as you can see in Europe. The capabilities that we have to bring to market and layer on top of each other and distribute in a global way around the world is causing us to gain market share across all of the continents in IMK. It's a really exciting story. Now I'd love to hand over, 3 minutes late, to the IMK panel who are going to tell you what's really going on on the ground. Thanks, guys. Thank you.
Sit next to me.
Okay. Okay. Now we're going to hear from the guys that live it and breathe it every day on the ground. Let's start with the economic environment, which is a little bit different in each of your respective areas. Gilberto Caldart, in Latin America, there's no shortage of media reports about particularly Brazil. Brazil is your largest market and actually one of Mastercard's top five markets. What's going on there? Are we talking about a recession? Are we talking about a depression? How is all of this stuff affecting the payment space?
All right. I keep teasing Dennis that China needs to grow more than Brazil will grow more. Anyway, jokes aside. What's going on in Brazil? I think you're all following. We are going through a major crisis, which is not just an economic crisis. It's a political crisis. It's a governance crisis. All of that is making an impact into the economy. The forecast talked that Brazil's going to shrink this year for about 2 or 2.4 percentage points in terms of the GDP. Next year might come back and shrink the economy by half a percentage point. We expect that to carry on for the next couple of months, and eventually out of 2017 is going to resume the growth. All of that is of course forecasts. I'm Brazilian, so I'm optimistic. I expect that that will get better.
All of that is having an impact on our industry. Our industry is very resilient. As Ann was mentioning, a lot of cash to be displaced in Brazil. First half of the year, the industry has been growing about 10%, a little bit over 10%, compared to 18% the same time last year. It's a substantial reduction. The good news is that by the great job that our folks are doing on the ground with financial inclusion, getting into new payment flows, we are growing above market about 4-5 percentage points. We have a very resilient business there. One of the examples I like to just mention very quick is the inroads we are making in transit. We were just chosen a couple of weeks ago by the Curitiba City.
I don't know if you're familiar with Brazil, but Curitiba is the largest city in south of Brazil, is the eighth most populous city in the country. They've chosen Mastercard as a brand for their transit system, which we are now starting to roll out. That's just one example. Many other examples of what we are doing in terms of new payment flows with government subsidies and financial inclusion. I'm cautiously optimistic about. I think it's going to Continually, a couple of months, in the next year, we should resume a little bit more of the growth and keep displacing cash there.
Okay, great. Thanks.
China grows more, it speeds up.
Dennis, we'll give you a couple minutes just to think about your response to Caldart here. I'll move to Javier instead and say, the economic headlines, while they're certainly not as bad as what we see coming out of Brazil maybe, they're still not great for Europe. Mastercard Europe, despite these bad economic headlines, still seems to be growing. What's your secret?
Barbara, I'm almost insulted by your question. I think it was obvious. It was said before. We're much better looking and more intelligent than the other guys. We're growing.
You know, you say that all the time. I was hoping maybe there's a different answer.
In addition to that, you have some interesting things happening in Europe. We've been growing for, as you have seen, quite well for quite some time, there's some good stuff happening. We tend to talk about the legislation on a negative light, there are some good things about the legislation. One of those, as you know well, is the reduction of interchange across the board. Now we have some large economies in Europe, like, for example, Germany, where high interchanges were really an issue, and that deterred some of the very large merchants from accepting cards altogether, let alone promoting them. You have digitalization. Ann mentioned how she can tap and nicely get into the tube these days. In London, that's important. We've seen high pickups, for example, in Poland when we introduced NFC.
You know we have a mandate Sorry, an arrival date for NFC in Europe in 2020, and all terminals are NFC equipped. These are a number of things that are happening in a market where historically we didn't have too much of a good penetration. You saw that already as well. People are still using a lot of cash. Some good things are happening in the market. That's the first point. The second point, it goes back to our own situation in Europe. Look, it is pretty intuitive. It's very difficult for a local organization or even a regional organization to compete with a global company. We saw it this morning. Look at all the wonderful stuff this company's doing across the world in all segments, in all products, all kinds of future of whether it be safety, security, and all of the above.
It's very hard if you don't have the means, if you don't have the capacity to invest to replicate that. We are in a privileged position. We're well-placed. We are capitalizing on that, and hopefully we'll continue to do that.
Okay, great. Dennis, I don't know how you want to respond to your colleague here about China needs to grow faster. We've definitely seen the headlines saying that it's been slowing down recently. In fact, the government has even taken some actions on the currency. How is the economic environment impacting China? Maybe more specifically, since today in China, the big piece of our business, other than when I come to Shanghai, would be when Chinese nationals are traveling overseas. It's the cross-border business that Mastercard takes advantage. Has that all changed, what you're seeing from that standpoint because of what's happening in the economy?
Yes. Indeed, the macroeconomics in China is slowing down for sure. Long term, in looking at the longer term of things developing, I think the payment market in China is still very promising, very strong. If you look at the slowing down, it is part of the reason is that the government is steering the economic growth model from a more investment-led model to a more consumption-led model, right? There's a huge transition happening. That for the long term will be tremendously good for the payment industry to start with. If we're going to look at the slowing down, we're talking about a potential risk to the official target of 7% GDP growth this year. We're looking at a potential PCE slowing down to just shy of 10%, right? To China, this is slowing down.
These are still pretty strong growth numbers to look at.
Is it good enough for you, Caldart, or you want more?
Yeah. No. Go ahead.
Yes, the effects, if you look at that, it's nothing like what we've seen in other markets. For example, in Russia, you're talking about Russian travelers seeing a deterioration of their currency of some 45% versus the peak time. What happened in China was last month was 45% depreciation. That is not immediately impacting Chinese travelers' travel decisions in any way. Indeed, if we look at the first half of this year, there's really strong cross-border traveling happening from China. My answer to the Brazilian situation is I'm going to look at ways to send more Chinese traveling to Brazil. Indeed, that travel behavior is fueled by a few things. To start with, you have the growth of personal consumption power. The ability to afford cross-border travel is growing tremendously in China, and that still is the case.
More importantly, I think there's an underlying driver, more technical driver to that as well, and that is the access to travel visa or travel conditions. Take myself, for example. Before the age of 27, I don't have a personal visa at all, and that is not available to most Chinese people. That has changed. It started with Tier 1 cities, where you have more Chinese consumers having the ability to have visa and then passport to go outside of China. It now extends to Tier 2 city and more and more Tier 3 and Tier 4 cities. It's a controlled process, but it is happening. Also, countries like the U.S. is now granting 10-year travel visa to Chinese travelers. We're still seeing really strong cross-border traveling growth.
Right now, if I look at the corridors, Hong Kong, the U.S., U.K., Australia, these are really, really good top travel destination for Chinese. This year, we're also starting to see Japan and Korea recording very strong growth. I think Brazil is probably going to be the next one. That's the base of our business in China right now. It's about cross-border. It's about outbound traveling and inbound traveling.
Okay. Not only are the economic situations a little bit different across each of your regions, but from the regulatory front, we do see a lot of differences, but some similarities as well. Dennis, I'm going to stay with you because probably the single biggest question we get from this audience is what about the Chinese domestic market opening up? Ajay and Martina have continued to say, "We expect to be technically ready to process in China in 2016," but there's obviously more to just being technically ready. Can you give us just a quick update on where things stand right now?
Sure. Let me start by reviewing the timeline of things, how things stand at the moment. The PBOC, the central bank, the payment regulator of China, is right now evaluating comments from this consultation phase from the preliminary regulation they issued in early July. We expect this to complete perhaps in 60-90 days. After which, we expect the final regulation to come out, at which time all the license applications can be submitted. PBOC will have 90 days to come back with their answer. If things stands according to this timeline, we're hopefully looking at towards the end of this year, we'll see something from China.
That's the process. Where is your team in terms of moving forward and getting ready?
We are doing a lot of things. In terms of preparing for the entrance into the domestic market, there are maybe a couple of key components relating to our preparation that I think is worth mentioning. There are others but the two key ones are getting to a operational readiness and getting to a market readiness. There are other things. We need to build our internal supporting functions to prepare for that. We need to make sure that our brand awareness is still there but with a new context being that we are now both international and going forward more domestic. All this needs to happen. Really it's about operational readiness and market readiness I would like to delve into a little bit more.
By operational readiness, I mean the need to bring all our infrastructure and the technology into China. With the issuance of the preliminary regulation in early July, when we look at that we figured we have got a pretty good sense of what is required on top of what we already have on the ground. We're working on it. As Ajay said, we are looking to achieve full readiness operationally by the end of 2016. There's more to that. It's not just about technology, it's also about how our business is prepared towards this huge new opportunity. In terms of market readiness, we're looking at a few things. How to get issuing. How to build more merchant acceptance ahead of the actual opening of the domestic market.
How do we determine the right products and services for the market and how do we participate in the pricing in the market. In a nutshell, when we look at issuing, we already enjoy really, really strong partnership with all Tier 1 and Tier 2 banks in China through the past 30 years of operating there. We're going to continue to foster that strong relationship. More to that, we're going to look at the next layer of banks to expand our customer base to be able to serve more geographies. We're talking about the Tier 3, Tier 4 banks in China, hundreds of them. We're starting to work with them to onboard them into our world of services. That in our mind will provide a strong growth engine for our domestic business in the future.
Likewise, on the acquiring and on the acceptance side, we enjoy an existing working relationship with all top-tier acquirers in China. We're looking to expand the coverage to more acquirers and in this case it's going to be not only banks but also the payment service providers who are specializing in acquiring services. We're expanding our reach. We are going to build acceptance where it matters the most to our customers. It's going to be the Tier 1, Tier 2 cities, the big cities concentration of our customer in this geography. It's also about national retailers and also key merchant categories. Right now our cross-border acceptance is more about inbound traveling. That's a more T&E type of merchant. We're going to expand into the more everyday spend type of merchants.
You mentioned pricing. I know that's a question we get a lot.
Yeah.
Just briefly, what can you say about that?
Yeah. Right now, you may or may not know that right now, the merchant discount rate in China is regulated in the offline space. It's a different story in the online space. It's much less regulated, more competition is allowed. There is new regulation being drafted at the moment that can potentially change that. We still don't know how much that will impact our ability to participate in the pricing. I won't be surprised, indeed, in a market like China, where I would think long-term wise, pricing is going to be low for this market. I wouldn't be surprised about that. I think we'll be looking at more opportunities to participate, for sure.
Javier, we've talked about European regulation for years and years. We get questions about the interchange caps all the time. The one thing that we don't seem to talk a lot about is the separation of the scheme and the processing, that requirement of the new regs that comes in next June, I believe. How do you see that affecting your world in Europe?
Barbara, let me say that there is no need for divorce. They were never married. Okay? We have never linked brand and processing. We have been compliant with the SEPA principles forever. In fact, we've talked about this before. You know that unfortunately, we process around 40% of all transactions in Europe, i.e., we do not process 60%. We've never been married. The impact, though, there will be some impact to us. There will be some operational impact because that separation of scheme and processing, although we don't know finally what it's going to look like yet, because it's under the European Banking Authority, has to now interpret the law and then provide some guidance.
To the best of my knowledge and for what we can see today, it's all about kind of organizing the existing resources we already have within Mastercard in order to create a discrete separation between the two. The good news, though, is that that is not the case for everybody. That is the case for Mastercard, but it's not the case for everybody. There are particularly local organizations in Europe which do bundle brand and processing. That's where the opportunity comes in for Mastercard. It's the law, but it is at the same time, the market. You got the large issuers, which has talked us about some of our wins. Some banks operate across Europe and the world; therefore, they want to centralize their transactions. They want to see those transactions going cross-border.
We are in a great position to allow them to do just that. The same is true with the acquirers. Part of the legislation, we haven't talked about this yet, but we can, for those of you that will come to my session after this one. I'm sure it's going to be all of you. Looking forward to it.
Just so you know that one of the biggest complaints we've had in the past is that people can't get close to Javier's lunch table because the first group of people sit down, and they never leave. The poor man never gets to eat lunch. This year, instead, we're going to give him a chance to eat lunch, then we're going to have a separate session with Javier at 1:30.
We'll talk more about that. We haven't talked about this, but remember that the legislation does also talk about central acquiring. That's important. That means that you can be in one place and centrally acquire transactions from across Europe. That means somebody's going to have to bring those transactions to that central location. That is, of course, true as well with the large retailers. For us retailers, they want to simplify the way they do things. They want to simplify the checkout. They want to have the same process in Poland or in the U.K. or in Spain or in Germany, everywhere. They need also to centralize those transactions. We welcome that part of the legislation. We're well-placed to help our clients make that happen. We see good stuff coming out of that, but more after lunch.
Yeah. Great. Thanks. Caldart, Brazil usually your largest market, but I've heard you talk about several examples in some of your other markets where regulation-- most people think regulation equals bad, but sounds like there's some good opportunities for us in some of the other markets. Can you share some of those examples?
I see the red mark, I'm going to go quick on it. Clearly, I think the message-
He's not colorblind.
Yeah. The message in Latin America from the regulation point of view, outside of Brazil that is most advanced in terms of regulation, is that regulation equals opportunity. Ajay mentioned at the beginning of the conference that the more and more we talk to regulators, they're looking to promote financial inclusion, reduce use of cash, and pass policies that will create more competition into the marketplaces of Latin America. I want to quick just go through three examples of it that are very recent, if you will. One is Colombia. The government of Colombia just passed a policy or a bill to reduce 27% the cash usage between now and 2018. By making their payments being electronic and also promoting conditions for that to happen. It's a clear push in a market where less than 10% of the private consumption expenditures go through electronic payments.
One example. The other example, very quick, is Chile, where the government is opening up for more competition into the acquiring side, and also bringing on financial institutions to issue prepaid cards to service other payment flows in the marketplace. It's happening, it's happening as we speak. It takes some time for that to place itself and work, but is another example. The last one, which opens up a lot of opportunities for us, is the Mexican case, where two years ago, legislation was passed to open up the switching market. We've been working hand-in-hand with the regulators in preparing ourselves. It's taking some time, but it's happening, that we will touch transactions in Mexico, and that is the case of Colombia, and that is the case of Chile.
Clear, in our case, all the regulation that we've been seeing coming out equals opportunities, more penetration of electronic payments in Latin America.
Thank you all. Gilberto and Dennis will be having a lunch table discussion, so you can get a little more detail from them there. Javier's going to have his own session at 1:30 P.M. Thank you to my panel. Now we're going to turn the program over to Martina.
Thank you, Barbara. Hello, everyone, and thank you for joining us here in New York or listening in to our webcast. I know this has been a long morning. You have been very patiently sitting here. We have a few more things for you to do. I'm going to pull this morning session together from a business driver and a financial perspective point of view. Then we have a Q&A, so all of your pent-up questions, demands, you can ask then. We're going to have then Ed McLaughlin talk a little bit about the product showcases that you can see down on the 6th floor right after this session finishes. My comments, I'm going to do four things. First of all, I'm going to have a look at the July, August numbers, as well as our financial performance for 2015.
I will be talking about our capital planning principles. Thereafter, I will provide us for an update on how we invest for growth, both from a past perspective as well as from a future perspective. Finally, what you've been all waiting for, I will be discussing what we see for Mastercard's long-term growth and our financial performance expectations for 2016 to 2018. Yes, it is a three-year period. Let me see if I can work this clicker. Oh, it does work. Good. Starting with 2015, our year-to-date business drivers. Let's review our current quarter's data through the end of August. The as-reported numbers that you see on here reflect the data that we reported in the prior earnings calls.
The July, August growth rates, as you know, reflect processed growth metrics, which as you know, is the only data that we have available intra-quarter. As you can see, the trends are about the same on average when you compare the July, August data against the second quarter. Based on these drivers, our expectation for the full year 2015 are essentially unchanged since our last earnings call. We continue to navigate through a number of headwinds that we've been talking about a number of times during the year. The things like the lower gas prices that Chris was already talking about that have not yet translated into other consumer spending. Local currency headwinds, difficult situations in Russia and Venezuela, as well as the larger upfront deal incentive amortizations. Before I move on, I want to mention to you two items. First of all, on the tax rate.
You should continue to model a full-year tax rate of about 27%, so there is no change. However, I do want to remind you that we are in the midst of closing out several tax audits, and they might result in a benefit to our tax rate within the next six months. That could actually be as early as this quarter. I can't give you any numbers around that until the tax audits are completed, so just stay tuned on this topic. The second item is that we have recently made a decision to terminate our U.S. pension plan, which reduces our benefit exposure by locking in an annuity return for those employees who elected to not take a lump sum distribution. That will result actually in a pre-tax charge of around $80 million, which you will see showing up in our third quarter financial results.
We will be excluding this charge as a special item due to its one-time nature, it has nothing really to do with our underlying business operations. Here you can see our progress against our 2013 to 2015 performance objectives. While we exceeded actually our minimum expectations for the 2013 to 2014 period, 2015 has been a bit more challenging for all of the reasons that we just talked about. We're still coming out, though, within the objective range we expected to achieve, though at the lower end of the net revenue and EPS growth ranges. Let me peel the layer of the onion a little bit for you. When looking at our projected EPS growth for the 2013 to 2015 period I just want to quickly walk you through the various components of our expected performance, which were all contemplated in the objectives.
Certainly, the largest contribution to EPS growth will come from our solid underlying operating performance. That's driven by the top-line growth together with the investments that we have made, as well as managing our expenses prudently. Over the three-year period, we expect to see a benefit of about three PPT from taxes as a result of better aligning our tax structure to our business footprint, that does exclude the benefit that we might be getting from the most recent tax audits that I just mentioned. Also, as you can see, we expect a benefit of about four PPT from our share repurchase programs over the last few years. Let me now switch gears a little bit, and talk about our capital structure. Our guiding principles have really not changed.
We want to preserve a strong balance sheet, liquidity, and credit rating, all in order to make sure that we make the right investments in order to keep the long-term growth going. Given the strong cash flow capability that this business has, we expect to have excess cash flow after pursuing our growth strategies, which we would target to return to shareholders like we did before. At this point, our bias does remain towards share repurchases, as it provides just more flexibility from a business point of view overall, we continue to regularly review the dividend level.
We will continue to evaluate our debt equity mix as we had established our access to the public debt markets earlier last year, keep in mind that we need to preserve our strong single A credit rating, which is an important consideration for both issuers and acquirers when they evaluate the settlement counterparty risk of their payment network partner. Here are some numbers. Since 2007, we have returned more than $14 billion to shareholders through either dividends or share repurchases. Just to put that a little bit in context with what Chris was saying, that when the company went public at roughly $5 billion of market cap. It's $14 billion since 2007 that we've returned. As you can see on this slide, over the last three years, we have significantly increased our return of capital to shareholders, raising it to $3.9 billion in 2014.
This year, you can see we are continuing this very strong trajectory, having already returned about $2.9 billion through August, that does include the 45% increase in the dividend that we did beginning in February of this year. We have about $1.6 billion of share repurchase authorization left at the end of August, we will likely be returning this year even more than we did in 2014 to our shareholders. Now let me turn to how we have been investing back into our business. Over the last five years, we've been able to deliver substantial bottom-line growth while still investing in the critical areas that continue to drive future growth for the company and for its shareholders.
Not only have we made significant organic investments, which resulted in the achievements that you just heard from all of my colleagues this morning, we have also acquired a number of businesses which allow us to either expand or leverage existing capabilities, again, as you heard from the examples that we talked this morning about. All of you know that we have a very disciplined framework that we apply when evaluating acquisitions. We have strategic, operational, and financial criteria that any acquisition must meet. We know that it takes some time to see returns from these investments. Especially for some of the most recent investments that we have made over the last 18 months, it's relatively early days yet. However, when it comes to acquisitions we made a few years ago, the benefits are clear.
We would have never gotten to where we got to in the prepaid space, as Craig Vosburg was talking about, without Access Prepaid program management capabilities, particularly in the area of multicurrency cards. DataCash, which is another one of our older acquisitions, has allowed us to leverage its world-class fraud capabilities across eGateways. Going forward, you will see us do more of the same to drive future growth. For example, we will continue to invest in geographic expansion. Having heard Dennis, China really comes to mind at this point in time, even though there's always one step forward and two step back. Dennis, we're going to have to work on this one.
Even without knowing what the final regulations might involve, we expect that over the next couple of years, we will need to invest at least $tens of millions to be both technically and market-ready to compete as a player in China's domestic payments market. We will also continue to further invest in the digital space as we can drive more electronic payments both in-store and online. We will continue to invest in our services area, such as safety and security, loyalty, information services, and processing. Let me tee up a little bit the drivers of long-term growth, and we are really not seeing any significant changes from what you have heard us say before. As you know, the macroeconomic environment is of course important for us. PCE growth, the secular trend, all play an important role.
Other macroeconomic factors such as the oil prices, foreign exchange, international travel and trade are very important to our business. In addition to the macroeconomic environment, the technological advances that we've been able to drive make it easier and easier for consumers and for merchants to transact in a digital way, be it in-store with a mobile phone or simply making a more secure and faster payment online. This, in turn, presents an even larger opportunity for us to displace cash. At the end of the day, our core products business is the foundation of our business model. As Chris and Ann both mentioned, our ability to successfully sign new and renewed deals that make economic sense for us really depends on us continuing to expand our product offerings that differentiate us from our competitors.
Driving financial inclusion will help the world to reduce cash, will help us to put infrastructure in many countries who still don't have it, and it will expand our geographic footprint, and that's really key to growing our business, and the investments in it are really important. Beyond our core products, we look to expand our presence across the payments value chain. You've heard that theme this morning, too. One of our bigger opportunities is in the area of information services and data analytics. By coupling the current capabilities that we have in our Mastercard Advisors unit, together with the vast warehouse of anonymized data with the new capabilities like APT and 5one that you have heard about from Kevin, we believe that we can offer value-added solutions to a variety of our stakeholders, be it issuers, be it merchants, be it other companies.
Additionally, you heard Kathy McCall talk about how we're expanding beyond our traditional switching role to get into the various adjacent areas of processing. That does not only allow us to touch the transaction that we might not be currently switching, and therefore is giving us, of course, the data that we otherwise might not be seeing that we really need in order to power the analytics business. It has also added to our capabilities in areas such as prepaid. All of this work could actually open up more opportunities as countries are opening up their domestic switching and processing businesses, so the competition to their local schemes. With that as a backdrop, let me look at how these drivers translate into long-term volume and revenue growth. The left side of the chart should look fairly familiar to you.
Here you see the contributions from PCE and secular growth to purchase volume growth adjusted for the markets where we cannot compete against domestic processors. Our market opportunity from volume remains about in the 8%-10% CAGR range over time. Really no change from what you heard from us say over the last many years. Similar, when we look at the factors driving revenue growth over the long term, we still see that our business can produce low to mid-teens revenue growth, which is what we have said again, many, many times. This is the long-term growth perspective. I just want to spend a minute on the different factors driving revenues. Looking at our traditional core business, core products. You just heard from my colleagues that it continues to be a solid driver of growth.
You also heard from Gary, from Craig, from Kathy, from Kevin, that over the last few years, we carefully expanded our services business through organic and through M&A investments. These businesses are key assets that differentiate us from our competitors. They complement our core business, they allow us to compete effectively in the marketplace, and in fact, they now represent roughly a quarter of our revenues and produce a higher revenue growth than our core business. Beyond the mix of core and services, other mix factors impact our revenue growth over time. These include what you all know, domestic versus cross-border transaction, credit versus debit versus cash, whether we process the transaction or whether we switch the transaction or whether we not. We are not assuming any significant amount of net pricing in here.
Of course, we hope to continue to compete in the market for expanded relationships with existing customers and to attract new ones. Here is now what you've been all waiting for, our performance objective for 2016 and 2018. By the way, these include all M&A transactions that we have made to date. Based on our strategy and execution capability, we do believe that the business can deliver a net revenue CAGR in the low double digits over the 2016-2018 period. This does not assume a significant revenue uplift in this period from any new domestic China business. Additionally, local foreign exchange will continue to be a headwind as the emerging market economies continue to be stressed and thus impacting their currencies. We kept the 50% operating margin minimum in here. Remember, we are not managing to that 50% margin target.
Rather, it's the minimum margin level that we expect that our business can generate even after considering all the right investment opportunities for growth and managing our expenses prudently. We are expecting an earnings per share CAGR in the mid-teens over the 2016-2018 period. This does include an assumption of continued sizable share repurchases, though those are deriving a slightly lower benefit in the past, given the share price. We are also assuming that the tax rate will be around 28%-29% over the three-year period, likely starting at the higher end of this range in 2016. You can see when you take those two factors out, that we expect the underlying operating performance for the future to be fairly similar to what you've seen over the last three years. All of these objectives are on a constant currency basis, and they exclude future M&A activities.
Thank you, now let me turn back the program to Barbara, I think I'm inviting my fellow executive committee members up to the stage for the Q&A session.
You're the stagehand too? Yes, you're up.
Should I bring a chair?
No, you don't have to bring a chair. There's a chair here for you. Water? There's water on some of the tables too.
Take the front one.
Now we're ready to start the Q&A session. Wait a minute, where's the clicker? There we go. Okay. For those of you in the room, please wait till you have a mic before asking your question, and remember to please state your name and your affiliation for the benefit particularly of the management team here. For those of you who are using the meeting app, you also have the opportunity to ask questions through the app with the Ask Question option. You do that by tapping the question mark in the upper right-hand corner of your screen and typing your question. Again, for those listening in, we also have the ability to take your questions, and you do that by hitting the Ask a Question button on your webcast player.
In order to get to as many people as we can in our allotted time, we ask that you keep your questions brief and limit yourself to one question and one very brief follow-up. We're going to start the program here in New York in the room. Can we raise the house lights a little bit so that people on the stage can actually see the people in the audience?
Cut these three if you don't mind. They're in my eyes.
Yeah. That's as good as-
It comes straight in your eyes.
Can we lower the lights up here, maybe, to help that too? Okay. Bryan, why don't you offer the mic to somebody?
David Togut with Evercore ISI. Just one question and a quick follow-up. First question, Martina, really is on operating leverage. You didn't specifically discuss the potential for margin expansion through your new long-term guidance. Could you address philosophically how you think about margins and what you see as the possibility of margin expansion?
So really that has not changed from what we even had embedded in the last three-year guidance. First of all, I think most of you know that in our core business, when we transport extra transactions on our network, our margin is around 80%-85%. What we have done is we have really looked very critical at the business, and we had made decisions in terms of what kind of investments we actually have to make in order to keep the long-term revenue growth of the company going. That's where you see the differential between that 80%-85% to the 50%. That's why we said we are not really guiding towards a margin expansion. However, depending how the revenue comes in from time to time, there could be some margin expansion coming, but it's not that we are targeting at this point in time.
For the future period, for the 2016 to 2018 period, I have to remind you what you just heard this morning. First of all, with the governments really pushing a lot of cash displacement to electronic forms of payment, it's a huge opportunity and with the technological advances is a huge opportunity, but that requires investment. We obviously want to make sure that we preserve some of the investment capability of this company. That's what we had put into here. There are two areas that I can call out for you specifically. You heard it this morning already, but one's China. You don't really know when we actually can make additional money in China on the top line.
We do know, as you heard from Dennis, that we're going to have to invest money, and that is likely going to happen before we make extra money out of China. The second big area is still the digital area. With all of the things that are going on, we will have to continue to make some sizable investments in expanding that in order to take advantage of the long-term opportunities.
Just a quick follow-up. A lot of the themes that were discussed today, particularly expansion of co-brand, growth in commercial, and also the focus on travel, seem to point to increasing competition versus American Express. Can you talk a little bit about what possible competitive response you might expect, historically having been a leader in all three of those areas?
We've been competing in those areas for a while with the other networks and the other players in there. In fact, in the commercial space, it's not just Amex. It's also all the relatively dysfunctional methods currently in the commercial space. In the travel space, I think Craig mentioned travel, we are competing between the travel companies, the airlines, and the guys who handle all the bookings. They're a relatively inefficient way of reconciling and getting payments in the door, particularly if you're non-IATA certified. That's got nothing to do with Amex. We've got a chance to bring our capabilities to the table, and the virtual card number is a key part of that, which is something we own and have a patent protection on. It's not Amex per se, or Visa per se, or somebody else per se.
It's just great market opportunities in that space that we're going after. Been doing it for a while. The commercial session today was because over the last few earnings calls, a lot of people began to ask me questions about what were we doing in commercial. In the last earnings call, I told them, "You know what? We'll just cover it at Investor Day so everybody can get an idea of what we're up to." That's why it was brought out here. The work in commercial started some years ago. It's just that we think there's a long runway yet to grow in that space.
My view of what we're trying to invest in, and it probably answers the question for some of the others, is that I think that commercial will be a relatively important place to grow and invest in with a relatively shorter timeframe of payback than, say, services, which are very important for our future, because they are building a whole new set of revenue streams that go around the payment transaction and enable us to be embedded better and tap into different wallet sections of that customer. They take longer to pay back. The longest to pay back will be investments in new geographies, like in the case of China. You heard Michael Miebach a couple of sessions ago of Investor Day talking about our investments in Middle East Africa.
They're only now beginning to show us the kind of revenue and profitability dynamics that we'd like to get from there. He still has to put a whole lot of investment back in there on acceptance and issuer expansion. The nature of this business requires you make money out of what you're doing in your core business, and if you really have a 10-year perspective, start putting money back into these developmental activities. That's why I'm keen to not try and commit to constant margin expansion as the basis for how the company should be managed, but to consistent franchise growth and revenue growth with smart management of expenses, but growing for tomorrow. 10 years from here, we're still a really solid, relevant player in a new digital world with new geographies, with services built well. That's what I'm trying to get done, broadly.
I just gave you my closing remarks. Maybe we can skip that. I was prepared for this. I knew to go to college, right? You get a question and you only know three answers. Who gives a shit what the question is? You just give the answer you want.
It's called politics.
Does that mean I get five minutes back on the agenda because you just did a comment?
You get it back.
Jason.
Jason Kupferberg from Jefferies. Just two quick ones. First of all, what are the embedded assumptions in the three-year guidance around rate of rebates and incentives? Just going back to the conversation on process transactions, can you give us a sense on a global basis today, what % of your transactions are you processing, and how should we think about that evolving over the three-year guidance period?
Yeah, let's start with the last question. He means switching probably, off the end settlement, right?
Yes.
You mean still about switching five out of 10 transactions. You might remember, seven years ago or something.
Four
It was four out of 10 transactions. Despite all of the work that we're doing, there's still a huge runway, quite frankly, in terms of getting more and more processed transactions. The capabilities that Kathy was talking about together with our switching capabilities, hopefully will get us our hands around some of the more difficult countries, right? In terms of the first question, we don't really break out incentives or rebates into our numbers. What I gave you is the net revenue number, which obviously bakes in what our view is.
The one thing that I did say in my prepared remarks is that the net pricing, which is basically any list prices that we might be able to do and take from time to time, depending on the value of the product or service that we're bringing to the market, less any deal incentives that we have to do, obviously, in our deals, but we think that that is a fairly small contribution, if any, in our top line. Ryan, you want to hand somebody the mic?
Hi, it's Lisa. Lisa Ellis from Bernstein. Couple quick ones. First, can you talk a bit about with Mastercard Advisors, with some specific examples, how that business is driving the core business, how they're linked? For example, with the Kellogg example or one of those that you gave earlier.
Your mic's not working.
Sure. I'll take the advisors question, start on that one. I guess, Kevin really in advisors says two things. One is differentiation, the other is dollars. That's how he thinks about it. The differentiation part comes from how we turbocharge, we actually call it force multipliers, the ability for the consultants, the data analysts, and then the managed services folks to go in and actually work with our clients on growing their business. They'll do all types of engagements. They'll go in and analyze the situation. It could be optimization, could be usage, could be line utilization, could be cross-border transactions, could be authorization rates and approval rates, could be digital account acquisition, could be direct selling account acquisition. They actually can help people build businesses and then turn the businesses over to them as well.
They're embedded in many of our customers, and in partnership with the account teams, they're completely synchronized on the objectives of the account. All right? Then we deploy assets, Kevin deploys assets, which are pretty much, they're very transitory. We can move them region to region, country to country to actually tackle the opportunities. It's all driven off things that are going to improve our customers' portfolios. In the end, it helps them grow business, it helps us grow business.
I think one of the proof points is, I mentioned earlier that Mastercard Advisors was a big driver of our business in Europe. I don't think that there's any significant deal that we've done in Europe in the last couple of years that hasn't had a big Mastercard Advisors component in there. I'm looking at Javier as I'm saying this. Not only does that create stickiness, what Kevin mentioned, but it also increases the revenue you earn off the deal. Actually, if your advisors are in there helping the bank manage their portfolios, then the volumes get driven up in the deal. That's a pretty interesting result. We're starting to really track that now.
Thank you.
I just came back from Europe, I forget, last week. I've been traveling a bit, a little confused. I was with Javier in Italy and in Germany. We met clients there in both those places, whom Mastercard Advisors was the key starting point of the relationship. In fact, one of those Italian clients is our single biggest Mastercard Advisors client in Javier's region and has consistently done business with us on everything from improving their own portfolio, to targeting new customers, to figuring out ways to improve the efficiency of their operation. They've done the whole range. Mastercard Advisors connects directly to the core in some ways, but there's also portions of Mastercard Advisors in the analytics and consulting business that may not connect directly, but enable you to have an envelope around the customer where you become much more interesting to them and much more valuable to them.
Your C-level dialogues in that customer are of a completely different quality from what you would be if all you were discussing was, "Give me another 2% share of your credit card book." That's kind of where this is going.
Thanks. The follow-up was quickly on Mastercard Send. I think when you launched that back in May, it was quite B2B oriented. Today's dialogue was very P2P oriented. Can you just talk a little bit about as that product's rolling out, do you see it more targeted toward the directly competing in the P2P market?
Go ahead, Hamilton.
Sure. Just a moment on Mastercard Send. Think of it as a base capability that's absolutely unique in the marketplace that'll allow us to get consumer funds into their real bank account in near real time, any account in the U.S. We're also expanding that internationally with all of the accounts that we can reach. That foundation technology has a lot of great applications. Large corporations looking to disperse, advertisers looking to give benefit back to consumers wanting to send money to each other. You'll see any number of examples, and we have several downstairs of how we can use Send as a capability to enable all sorts of consumer benefit.
Okay. Ryan, you want to give somebody the mic?
Hi, thank you. Sanjay Sakhrani, KBW. I guess I just wanted to follow up on the EPS guidance or expected range. Just the lower bounds of that range has been lowered. Could you just talk specifically to what's driving that and maybe just the tax rate edging up next year or over this three-year period? Could you just talk about that as well, Martina?
Yeah. First of all, on the tax rate. We make, as you heard, 40% of our business in the U.S., and that comes at a 35% tax rate. Unless Congress is doing something about it, that's just the life at this point in time. Even when we have a lot of our revenues and profitability outside of this country, it's very difficult to be making up that differential in order to drive it back down to the 27% that we're expecting this year. Especially this year, we have a number of discretes in there. Naturally, the tax rate would always be trending up unless we can do something from a structuring point of view. That's why we're saying, look, it's a 28%, 29% over the period.
Of course, we're going to continue to look at how we optimize things, that's our best guess at this point in time. In terms of the ranges, I don't really think the ranges have changed much other than that we're dealing with a number of things on the top line. We've already talked about the investments, so I'm not going to go through that. On the top line, as you can see, we've been not really putting the China opportunity in, and we're still this year, we've been hit by about 2 PPT on local FX. That is one of the points that is really tough to get your hands around in terms of how is that going to change when you continue to see where the BRICS are at this point in time and what's happening in the currency markets.
It might come through, I don't expect it will be quite up to the 2 PPT, but it could be easily 1 PPT, and that's what we baked into these numbers.
One thing on the tax thing, Sanjay. We started this work about the time I joined, and Martina and I had a conversation about our tax rate at that time. Clearly, we were in the low 30s, Martina?
We were at 32, 33.
32 or 33. We said we've got to get this to fit the footprint of our business because it doesn't make any sense to be paying that number when those days, 55% of our revenue was coming from outside of the U.S. She and her team have worked along with a bunch of people in Ann's place and with Chris' team and even with the product guys and O&T to build this thing in a way that I think can give us a 28%, 29% sustainable tax rate. I don't think it'll go down too much further until the mix of taxes changes much more. That's a 300, 400 basis point move in this period of time, sustainable.
The only reason you're getting 27 to go back up is because you've got one-timers in there, which we are trying to discount for so that it doesn't get baked into the base. That's all. There's nothing else going on in the taxes. It's actually good stuff going on there.
Just my follow-up, you guys were pretty acquisitive over this three-year period. How should we think about the go-forward acquisition pace, and how large can these acquisitions be? Thanks.
Our industry doesn't have a great deal of very large acquisitions unless there's some colossal deal that happens tomorrow, but there's nothing of that type. So it tends to be in the smaller scale and size. I don't have a good way to give you a sense of comfort about what deal I would do or do not do. I'll tell you what, we look at about between 15 and 30 deals in a year, maybe. Sometimes more because you're adding on our investments. If you look at deals, full M&A purchases, if you look at those, in the previous years, we've done one or two in a year. It's just that last year had a bunch of them come together this year, that is 2015. I'm already thinking 2016. I got to survive three months.
You've got a mentality that says that we will be in the business available to be a good acquirer. That's not what's driving any way of thinking. It's if the deals are available, we're in the deal flow, they fit what we're trying to do, either in commercial or in services. That's where you'll see the majority of our energy or effort going in.
Jazel, you got somebody in the back there with a question?
Thanks. Donald Fandetti at Citi. I was wondering if you could talk a little bit about you have the EMV liability shift coming up. Wanted to get your sense if you thought there was going to be any sort of confusion at the point of the sale. Can you talk a little bit about what that might do to digital? Lastly, layer in your views on contactless dual interface in the U.S., if you think that could
Sure. I think there will be some level of consumer confusion, but the U.S. consumer tends to be pretty flexible in learning new approaches to use things. You get an iPad, it comes with a box and you press the start button, and people figure out how to use it. Dipping a card into a terminal and waiting a few seconds versus swiping it is not a massive change in behavior. That being said, you're going to see some queuing issues. The secret is out that EMV authorization is slower than magstripe authorization. We saw it in our own cafeteria where we put in EMV terminals. We had to add cashiers because it takes much longer for the transaction to actually get authorized and swiped through. As I mentioned in my remarks, the momentum is good. Terminals are being installed. Chips are being put on cards.
They're issued into the marketplace. There's a good chicken and egg momentum building. You're going to see consumers get much more comfortable with using contactless in smartphones. It started slow. It's starting to pick up steam. The merchants are starting to turn on the NFC capabilities at the point of sale, which will be very helpful. All the terminals going out now, if you look at them, they're fully functional. They've got magstripe, they've got chip, they've got pin pads, they've got NFC capability. They'll do everything. It's just a matter of time before consumers figure out how to use what they have in their wallet and use what the merchant has available and get through it. Like I said, I'm glad we're finally getting there, and we're going to cut down a lot, at least in the physical world.
Contactless dual interface cards, do you think that comes to the U.S.?
What's that?
Contactless cards, does that come to the U.S. at some point down the road?
We've had contactless cards for a long time. I think what you're going to see, though, is digital wallets in smartphones being the equivalent of a contactless card. I think you'll see more of that than more issuance of NFC-enabled cards.
Got it. Thank you.
Just to give some international data, seven out of 10 transactions now in Australia are contactless on our network. One of the reasons for that is the Australians have taken the contactless limit up to AUD 100, which means you can just about buy any decent day-to-day thing that you want to buy contactlessly. Also on the London Underground, we're seeing over a million taps a day. It happened really quickly. It happened within the first couple of months that it got up to that level. I think consumers adopt really quickly. Okay.
Hi. Thanks. Chris Brendler from Stifel. Not to beat a dead horse, but just want to go back to the guidance for a second. Your low double-digit revenue growth, really impressive. Earnings growth of 15% or so for the 3%-4% contribution from buybacks suggests not much operating leverage at all. I just wanted to see if I could ask it a different way. I felt like the acquisitions you've made over the last couple of years have been a little bit of a headwind. I would thought that headwind would've lapsed by now, as you sort of grow into those acquisitions. Can you maybe call out a little bit of the investments you're making besides China?
Chris, as to you pointed to earlier, the amount of change we're facing in the industry, it seems to me that the static authentication and static credit card numbers are something that may not be around for much longer, just given the threat from fraud and the cybercriminals out there. Can you talk about some of the investments you're making on that front to take the payments industry to the next level? Is that something you're talking about in the next five years, we won't actually have a card, and you have to change your company's name at some point maybe? Down the road.
Shall I do the first one?
You do the first one.
Okay.
I need clarification second one.
Just on the first one, right? The investments that we have done over the last 18 months, really they come to fruition more in the later part of 2016 and 2017 period. You still have a little bit of headwind baked into our guidance for 2016. It's turning around a positive trajectory 2017 and 2018. By the way, when you look at the top line, contribution of acquisitions by 2018, it's about 1%, okay? We're not talking about a huge number, but it's 1% in there. Chris?
Can you clarify the question, do you see cards as a form factor going away?
It seems like having a static card number and a CV number and something that a criminal could have in a database in Russia, it seems very common these days.
Yeah.
Is part of the change you're talking about in the next five years, is that part of it? Is it biometrics? How are we going to move away from sort of a static number to a more dynamic authentication?
Sure. Well, you're seeing EMV as part of it, so you've got a dynamic number being generated there. You're going to see, hopefully someday, tokenization on cards as well. You're seeing tokenization in the mobile payment space, so securing the payment that way. You're seeing biometrics, fingerprint technology, whatever the case might be. There are different authentication methods, and you have to think about authentication in the physical world and the digital world, which we lay at night thinking about. I don't think cards themselves are necessarily going to go away. If you think about it, you've got one of the world's greatest inventions, a two-by-three inch piece of plastic. Fits in your wallet, fits in your purse. You can go anywhere in the world and use it to buy anything, pretty much anonymously.
I think we're going to continue to see the evolution and the momentum of different form factors, like smartphones. I think cards are going to be around for a while. We haven't reached the tipping point yet on mobile payments.
Right.
Apple getting in the game was certainly an elephant stepping on the scales, but we're not there yet, and we're going to continue to see momentum and make sure that.
There's a lot of energy going into biometrics and other forms of identification into the transaction. That may happen. You've got cards on which you can actually use your fingerprint on the card itself as a way of showing up as authenticated. You've got Selfie Pay. You might still use that in conjunction with a card or not. I'm not sure that digital means only a non-card-based divide.
Yeah.
That's all I'm saying. I'd be careful jumping to that conclusion, at least for the next four, five, six, seven years. Out 10, 12 years, everything may change, and I might be able to look at Chris and transfer money just by looking at him, which would be cool.
Very cool, yeah.
It's really he gives it to me instead.
Yeah, I know.
But it's-
He wants you to look a lot.
Yeah.
Look at me. Stare at me for a while longer.
It's unlikely to happen in the next few years.
The thing that's interesting is what you see in Africa, I think it's like EcoCash. They introduced mobile payments and then they come and they say, "Can you actually link a card to this service?" Because the card can do point of sale.
Exactly
the card can go into an ATM machine. They move from the digital back into the physical. It's quite interesting. That's why the two things will coexist for a while.
Okay. I'm still trying to figure out exactly what the expense levers are and what the growth opportunities that you're investing in. Maybe you could just touch on India, because we haven't really talked about that at all, and I'll stop.
Yeah. Sure. I think India's got a huge potential opportunity because of the amount of cash in the system and the effort that's going on over there to get cash out of the system. The challenge in India is twofold. One is the level of infrastructure in the country in terms of acceptance is very poor. It's not even as though you've got a lot of smartphones. It's not that you can say somehow the smartphone will drive a payment methodology. There's a whole space to be gone through right now to think about how infrastructure will get built on acceptance of electronic payments. The issuing of biometric IDs to 600 million Indians was originally meant to be connected by using a dongle on a cellphone to be able to identify with your fingerprint your ability to pay even in a small village shop.
That portion of the expansion is yet to happen. What's really going on is opening of accounts and issuing people with debit cards, there's very little actual utilization of those accounts happening yet. Like in all these countries, I find that last mile to be the most hard work and the most investment and effort that's going to be required. What we're doing in India in the meanwhile is work with the government on things like scholarship disbursements and use cases to make those accounts get used. In the meanwhile, trying to work as hard as we can on expanding acceptance. India has 1 million merchants who accept electronic payments. There's probably another 50 million merchants who don't touch this stuff. Getting to them is a big problem because none of them pay taxes.
This is going to be a long slog over the next, I would say, 10 to 12, 15 years before you get to a stage where it's going to be a big payback. It's important. It's interesting. It's growing well. We're making good money out of cross-border, both inward and outward bound. Tourism is prospering. That's a good thing. There's a lot of money and growth that'll come out of India. The idea of this billion people sitting in cash, converting over, I'd say 10, 15 year kind of thing.
Okay. We promised folks that are listening in on the webcast, we'd take some questions, and a number of them have already been asked, but here's one that has not been. This is probably Gary and/or Ed. What are Apple Pay and other digital wallet technologies, friend or foe? Are you seeing any impact to your business from either of these, either positively or negatively?
All of the digital environments we work with, we see as incredibly additive to what we're doing in the network. We want to make sure we have a pledge, if you're a Mastercard cardholder, that you can have a great experience in any environment that you want to use. If you think about it, every one of these environments reinforces our value proposition to the consumer, that you can use your Mastercard today at tens of millions of merchants around the world, and you can get access to all the new technologies that you want to use. In fact, yesterday we've announced, you may have seen our Digital Enablement Express program to make it as easy as possible for valid token requesters that we've approved to come into the network and get access to a wide range of credentials.
We think that will actually accelerate the movement to being able to enable any device consumers have for safe and secure commerce using their SecureCode. We see this as absolutely additive. It allows us to reach new commerce flows, it allows us to reach new merchants. Everything which moves out of the physical world into the digital world eliminates our primary competitor, which is cash. We see 100% electronic transactions through those environments. It's great for our consumers and it's great for growth of the network.
I want you to understand that that's the balance at the end of the day. It's not that we don't recognize that this world holds threats and this world could hold disintermediation as much as it holds opportunities. Don't get me wrong. We get the idea. We're just trying to make sure that we use what we have as assets to be players in that space so people want to work with us and use our network and our technology and our skills and our safety and security and the loyalty and rewards and all those things we were talking about, so they want to work with us to enter into the space of payments. We get the threat idea, but I think we've shown that if you engage in a constructive, innovative way, you can actually be part of the value chain and not somebody who's watching.
Four, five years ago, it was the telecom companies, the MNOs, who were talking about how they could do payments without us or even the banks for that matter. As you know now, 50 of the MNOs around the world, which are the largest lot, are all partners of ours in some way or the other. Does that mean that the threat's gone away? No. It could come back at some point in time. At least we're working together and we've got a pathway of possible growth. That's the context of Ed's answer.
Tien-tsin.
Cool. Thanks, Barbara. A couple questions. Just on the push towards info services and adjacent services, I'm curious what the impact is on margins, the incremental margins on that business versus your core business. What does that look like? Is there any measurable impact on revenue yield? I had a follow-up.
Yeah. Let me give you a little bit of a perspective. What I said in my remarks, that our services businesses, those are all the components that you had seen listed on the chart, is about 25% of our revenues, right? The core business is about 75% of the revenues. That 25% of revenues has about a 40% margin at this point in time. It is lower, clearly, than what we're producing in our core business.
In fact, as I was telling somebody in one of the breaks, that just like the rest of our business engine, you have a high initial investment in some of these, and then you've got a variable cost versus extraction yield that changes over a period of time. You need to build capacity. A Pinpoint acquisition has a fair amount of capacity in it. When you buy it's a large one-time purchase, large as in relative to what I would do organically. That's kind of built into the thinking of where we are today with the margin. Our general belief is that there's no reason, and we have built that thinking into our commitment on margins going forward, that we believe we can improve the margins of that services business as throughput goes through it. That's kind of what we're doing.
We've already seen some of that happen over the last, I don't know, three years, four years, Kevin, in most of these, there's more space there.
Okay. Incremental margin there.
It's a good place to be, Tien-tsin. It's got stickiness, it's got different wallets, it's got growth, and it's got a margin profile that could be pretty interesting.
Yeah. No, it makes sense to push that and brings more business back to the core.
Correct.
I think it makes a lot of sense. Just my quick follow-up, just the nationalism.
Sure
topic. I've been thinking about that one a lot.
Yeah.
I'm curious, versus the last time we got together, is it a net positive or is it a net negative?
Great question.
There's some conflicting themes out there, right? With Visa Europe potentially combining with-
Yeah
Visa Inc. That's
Positive for global. I'm curious what your latest thinking is. Thanks.
It's a great question. Depending on the day of the week, I feel it's a positive or it's a complete pain in the ass. Right now it feels a little bit positive, and the reason for that is that things like what's going on in different countries around the world, regulatory interests and nationalism tends to create hurdles and benefits. Depending on which country is doing it at which point of time, either the hurdle is in my face or the benefit is in my tail, right? It just depends on the week. It's a hard question, Tien-tsin. I don't have a clear answer. It actually changes regularly. Right now, for an example, the idea of being able to enter China and get into the marketplace with a constructive relationship with the government where they want us to come in and bring capabilities, that's attractive.
The other side of that is they're going to want us to do a lot of things on soil-
which is different from our traditional way of doing things. Fortunately, we'd already done some of that work in China over the past few years, but we now have a clear idea of what else we need to do, so there's an expense side to it, but there's a great revenue side to it, too. I don't know whether it's a positive or a negative. I would be delighted if there was no nationalism, and I could just work out of St. Louis, Missouri, but I have this little feeling that's not going to happen for the next 10 years.
In addition to that, it's the overlay of the whole political situation, right? We also know every day of the week, either the U.S. and China are friends or there are some difficult issues which could go all the way to potential sanctions, right? It would be foolish to think that that does not impact how we deal with countries around the world. It does, clearly.
Mm-hmm. Bryan?
Yeah. Hi, it's Bryan Keane. I guess, Chris, there's been a lot of talk about some of the deals. You mentioned the Costco deal that was pretty price competitive.
Yeah
You're talking about a few flips. Obviously there's a lot of interest in. Is the margins in that North America business getting pressured by some of these contract negotiations?
It's something we've been dealing with for a long time. I don't call it margin compression, I call it yield compression, just to help Martina with her operating leverage. In the co-brand space, you've got very competitive dynamics right now. A lot of that is just driven by the fact that there's another player in the mix. You've got an issuer, you've got a network, you've got a merchant or a sponsor. They all want some piece of the equation. We are very thoughtful about what makes sense, how far to go on these deals. Like I said, we've managed through this for a long period of time. We have different levers we can pull. There's value-added services we can add on, information services to offset some of that yield pressure.
So far so good, and we continue to win and win in ways that we can make money.
We want to grow, but we're not going to grow it in a form that makes it hard for us to look ourselves in the mirror at night and say, "That was the right deal for the right economics, for the right positioning for the future." That I think you'll find us doing. We'll lose some deals in the process. We'll win some. Overall, we're headed in the right direction. That's kind of what we're trying to do.
Just as a follow-up, Martina, on the long-term revenue growth, there's the three other factors, mix, pricing, and share. Can you just give us some of the swings? Is mix definitely a positive the way you see the future? Price, is there areas that you see potential areas of price? Of course on share, do you plan on being able to continue to take share?
On share for sure, right? Our guidance says this year that we're going to expand our existing relationships and for sure trying to win new ones and just don't think about winning new customers just about financial institutions, right? Because as Gary was talking about, we are working with a heck lot more different stakeholders around the world. It's not just financial institutions, it's really expanding with all stakeholders. In terms of the two other items, right? On pricing, I already told you that from a net pricing point of view, i.e., list price, list deal pricing, I expect a very small, if any, contribution. From a mix point of view, that really depends. You guys have seen that swing around, right? It depends on cross-border, whether our outside Europe cross-border grows more than inside Europe, and that obviously has some mix impact.
It depends on whether people are using the cards first at the ATM and then later going to POS and how much that business expands. It's very tough for me to give you a rule of thumb here, but how I think about it, you're probably going to see very similar phenomena as what you've seen in the last 3 years going forward. This is the beauty of this business, right? Well, to one extent, it's the beauty of this business. These kind of factors do not change in a flash. They're just there, they're evolutionary, they develop over time, and over time, we get better and better at them.
I think one of the things, the product areas that has some margin potential going forward is commercial. You've seen that we're growing, but we're growing off quite a small base compared to our consumer portfolios. Regulatory changes can drive banks to start to recognize commercial customers that they've previously given consumer cards to. You're seeing some of that occurring in places like Europe. Also, if you look at a big bank's portfolio, you'll find if you look at their lending portfolio to corporate customers, only 15% on average of that portfolio is carded. That compares with a consumer portfolio that might be up in the 30%-40% range. What it says is, and I think Craig alluded to this, you've got a lot of banks out there that are lending money to commercial customers. They're not even thinking of giving them commercial cards yet.
Yet the return on a commercial card business is significantly higher than a consumer portfolio. That's really why we're thinking of using our analytics, our Advisors, and all of the things that we know to identify these customers for these issuers to help really grow that business around the world.
I think about what Kevin's made a point a number of times as you go into these relationships. If you get to a certain point, you do a deal, then it's around optimization. Kevin's point earlier about the deals where Advisors has been fully embedded, which are becoming more and more, if not all, the performance of the deal is better. Right? You work with a client, and then you look at the other services that we have and how those services can work into that relationship and extend the profitability and extend the revenue growth and the yield. It's kind of interesting how it all kind of lines up. Right? I think Advisors has been a real strong focal point for us as we've embedded them systematically. Javier throughout Europe, Gilberto throughout LAC, Chris in North America.
I think that is a real key focal point for us as we go forward.
The other big driver of revenue is cross-border. We're looking at putting our loyalty products to work in that. For example, you know we bought Access Prepaid a couple of years ago. We've been working in Gilberto's area in Latin America, and we've been giving some of the Latin American issuers the ability to embed Access Prepaid into the cross-border offerings. When Latin Americans travel up to America, they get more reward points if they use these cards. What we're seeing in the early uptake of this is it's increasing the spend two to three times on the card. If you're very focused and very targeted in these high-margin areas, you can impact a change.
The other side of all this is you've got a company that relied upon one form of selling, which is the clearing, authorizing, and settlement business at FIs as the key of our business. In truth, that's still where the key is, because around the world, accounts are held through banks. Without selling to them, you don't get to play. What's interesting is the kind of services they're buying from us is expanding. There is consistent discussion about the pricing of what was the core business, but these other services have got a different profile of what's bought and what's taken. Then you've got these services have the ability to go well beyond just FIs, as Martina was saying, to merchants and governments and get into them as well. It's an interesting mix change that's going on inside the company.
One of the biggest things we have to work on over the next few years, if we want to grow this services business well, is to have the right kind of sales force that not only comprehends our original core clearing, authorizing, and settlement business, but is trained and competent at selling a bundle. It's very different from just selling the transactional capability of signing up for your card book or your digital payment book. That's all of what's inside a lot of the thinking and the guidance that we get because the guidance we're getting comes out of our strategic plans and our near-term planning, and all this is embedded in those numbers.
If you think about it, one of the best examples of that is I think Kathy, across gateway services, processing, and program management, she has a competency map that isn't built by those business lines. It's built by competency. Then when opportunities come to us, she's in a position where she can pick this, that, and this to provide a solution that's very different than what anybody else can provide. All right? She's in the middle of bidding on a couple of books right now where it's because of that uniqueness, a settlement system from here, a points engine from here, something else from here. All right? It's that application, that ingenuity that's going to, I think, set us apart a little bit more over the next couple of years.
Okay. In the back, Jim?
Yeah, Craig Moore. The expanding discussion of biometrics is interesting in that it has the potential to lower fraud rates across all channels. I was wondering if there is a future that would include a lower interchange tier or something similar for a biometrically authenticated transaction. Secondly, things like Apple Pay have the ability to dramatically increase conversion. We're missing Apple Pay and services like that potentially in-browser, which is a huge hole for that capability. Are we going to see that maybe for even this holiday season? Thanks.
Go ahead.
On the interchange question, I mean, interchange is meant to balance issuance and acceptance. There are a number of factors that go into that. They flex from year to year. You can have a year where you've got very high credit losses. You can have a year with very low credit losses. You can have high fraud losses, low fraud losses, et cetera. It's very hard to specify the impact that improved fraud at the point of sale is going to have on interchange rates because there's so many variables that go into that. We can try to open up a new acceptance channel, which may drive down net effective interchange rates. Lots of moving parts there.
I think it is a good sign that we're going to have lower fraud rates with EMV in the U.S. I think it's one of those cases where we're going to have to see over time what that does to interchange rates. It's hard to specify one direction or another. One thing for sure is going to happen is I think over time, the distinction between card present and card not present rates will start to disappear. Not immediately, but over a long-term period of time. Because you can have situations where not having a card present is actually a more secure transaction than having a card present. You'll see that change in how we think and define interchange taking place as the technology rolls out.
Okay, I'm going to take one more question from the internet.
That's the ultimate forward-looking statement.
Yeah.
That's some time out, huh?
That's some time out.
Yeah.
From one of our European investors who's probably ready to go home for dinner now. This one is for Martina. How do you prioritize capital-
What? European investors only ask questions from Germans, is it?
Mm-hmm. It's a German investor too.
Yeah.
Okay. How do you prioritize capital given so many opportunities like China, digital services, et cetera?
Yeah. That is actually the beauty of the business. When we look at our annual budgeting process, we are just starting that process to the fun of my colleagues. There are hundreds of projects and actually, it's really tough to find a bad project in this business. As every company, we have only limited resources. We can only do so many things. What we typically do is, we think about investments in three buckets, right? The short-term bucket, which is up to 18 months, things like putting salespeople and commercial feet on the street. That return's usually a fairly quick ROI, we obviously would like to do these kind of things. We have a medium term bucket, which is typically the two, three and a half year bucket, and that's things like prepaid, for instance.
It took us about three years to get really this business up and running. We have a long-term bucket, and in the long-term bucket, you have a number of things in there. I would put China in there. At one point in time, there will be a significant return on China. We all know that. In every industry that goes into China, it happens. It can take a very long time as well as you have to gate the investments before that. I also would put into that bucket things that we're building out from a digital point of view. Digital infrastructure. I think we would be hard-pressed to tell you today that when we just talk about Masterpass as a platform, what kind of ROI you're going to get back.
We do know that if you're not there in digital, you're not going to be able to power the transactions of the future. That's how we think about it when we put our annual plan together. I say to my colleagues and they know that, they say it to their people, there is no long-term without a short-term. We kind of have to make sure that we can get all of these things lined up year after year after year, and obviously put it under the strategic timeframe that we look at when we look at our strategic plans, right, which is a 5 to 10-year period.
Okay. Ryan, you want to hand somebody the mic?
Jim Schneider from Goldman Sachs. One question about Europe. You talk about the long-term opportunity for processing share gain due to the unbundling between brand and processing fees. In what countries do you think will be the first for that to be a real opportunity, and in what timeframe?
Javier?
Yeah, Javier.
There is a country dimension for sure, I think you could think about that and look at the domestic schemes in Europe today. Think that countries that have a domestic scheme, there could be an opportunity there. That will be the first dimension that you should think about, say France, say Denmark, and so on. Some that are partial, like Germany or Italy, for example, which have a domestic debit scheme only, but not credit. That's one dimension you should be thinking about. The other one is the dimension of the large Pan-European players. You're going to see retailers who want to centralize things. Independently of whether the domestic scheme moves or doesn't move, you will see some players extracting transactions from certain markets and bringing them forward to a central location.
You'll see that with retailers, you will see that with issuers, and you will see that with central acquirers. That's where I expect most of the action to happen, and it's in fact where it's already happening.
That's helpful. Thanks. Just as a quick follow-up, regarding M&A, you've talked consistently about processing and analytics being the main focus areas for you. Is that still the case in the next three years, or are there are other areas you'd consider sizable acquisitions?
We actually talk about more than just processing and the data analytics information services area. We said loyalty. We're not everywhere in the world yet from a loyalty point of view. We also said from a safety and security point of view, in the fraud space, that we're continuously looking for properties there. The last area is kind of catch-all area technology. Ed McLaughlin and Garry Lyons, they're always looking after the next crazy thing from a technology point of view. There might be some acquisitions coming out there too. Those are the five areas.
Okay, I think we have time for one more question. Bryan, give the mic to somebody.
Ajay.
Could you introduce yourself?
Oh, bloody hell. Give the mic to somebody else. I'm just kidding.
Mark Lane from William Blair.
How are you?
Loan buy-side question. Visa Europe. Let's just assume that Visa buys Visa Europe. Can you assess the positives and the negatives for Mastercard from such a transaction? Are you convinced that it's a net positive or you're not sure, or what are some of the variables that you'd weigh?
Well, a lot will depend on how the deal is constructed, clearly, right? That'll determine what the market looks like when the deal is completed. Let me put it for you this way. Out some years, once the deal's done and the technology platforms are migrated and the people have been brought in and the cultural changes have been done, all of which, by the way, we've lived through in Europe twice over as a company, it does take a little while to get that done. Once that's done, it makes one of the advantages that Ann talked about earlier, which is we are truly a global scheme, talking to some of the clients in Europe. That advantage will go away, there'll be a level playing field on that front between them and us. Between here and there is a fair amount of timeframe.
That's the first part. The second part is that the level of attention and effort they're going to have to put in to get their technology migrated, not to mention money, also has some implication for what their pricing strategy would need to look like. That probably would be some form of a near-term positive for us because they're competing and winning when we are not an association and Visa Europe currently is. If they were to look at that matter a little differently as a way of compensating for their investments, that may give us some opportunity in the marketplace, pricing, business, revenue, growth, share.
The third angle is that once the large transaction happens and a number of the institutions there take their money and put it to their bottom line, then the question is, what's their view going forward and how much into the forward will they be able to be open for what they'd like to do with their future relationships? That could be a positive as well if it's not way out there. It depends how the deal is constructed. I've been watching it for a while. It's something that I can't impact, but I can do things with it once I know the deal is happening. We've been preparing for this deal to happen since the day I joined the company because I kept getting told it's going to happen this month.
We've got a lot of good ideas in place, and actually, we're itching to get a chance to do some of those. We'll see.
Okay. Panel, thank you very much. Before I turn the mic over to Ed McLaughlin, I want to just go through two quick details. First, lunch will be available. As you walk out, please grab a boxed lunch. As you make your way out to the elevators, the product showcase and the luncheon tables are both down on the sixth floor, so you have to go down one floor on the elevator. The one thing that I did forget to mention about Javier's breakout session at 1:30 is in that session, we've also invited Dana Lorberg, who many of you have met before. She's one of our network experts, but she was very instrumental in the work that we did connecting NSPK to Mastercard. If you have questions about what we did in Russia, Dana is your lady to speak to on that. The product showcases.
We've got 11 different stations. I can't impress enough on you is that this is your chance to talk to the product experts, the people who live and breathe this every day. Please take advantage of it and talk to them and learn about what they do. With that, I'm going to turn it over to Ed McLaughlin so he can get up here and defend himself and his group about all the crazy things they do in technology. Ed?
Sorry.
No.
I just want to take a quick moment to welcome you to what we're doing next with the product showcase, because this is your opportunity to see a lot of the products, the services, the capabilities that we've talked about today. As Barbara said, I think more importantly, give you a chance to talk and go deep with the leaders at Mastercard who are actually responsible for these initiatives. This year, what we've done is we've grouped it really into five themes. The first, I know you have a lot of questions about, is how are we leveraging our data? For that, we've picked two examples. One is an acquisition, APT, that Kevin talked about how we can work with merchants to leverage their data, to leverage APT's expertise to test and learn and answer essential business questions.
I think the essential question we're looking at here is: should I introduce a low-cost tuna melt ? Make your vote and go see how APT does it. Next to it, we have something which is probably even more interesting, this is something that came out of a Mastercard Labs innovation exercise, which is our Retail Location Insights. A merchant can ask a very different question: where should I open my new restaurant? Well, suddenly we can use the transaction data we have. We can use that view of economic activity to give them insights they never had before for where to optimize their business by selecting retail locations.
For those of you who live and work in Manhattan, just the example, seeing the data-based view of how commerce happens in Manhattan, it's really a unique thing to see. That's just some of the examples of leveraging our data. Next tool we talked about protecting our transactions, the safety and security. You can go in deep with the people who are building and running our digital enablement system, MDES. You can see Apple Pay and get a preview of Android Pay and Samsung Pay that will be built on top of it, and see how we're using Masterpass to connect consumers directly and safely to their financial institution for digital commerce.
We also have other examples how we're verifying identity online, you can even see the Selfie Pay, how we've taken this thing like security of facial recognitions and biometrics and made it compelling or even fun for consumers to use, all the while strengthening the transaction, building affection for the Mastercard brand. We have a few other innovation examples we wanted to highlight. One of which we talked a little bit earlier in the Q&A session, is Mastercard Send. This was described as a breakthrough technology when we introduced it earlier this year. The ability for corporations, for individuals to move money directly from the bank account they have directly into someone else's bank account in near real time. It's a fundamental change to the type of services that are available out there.
There's a lot of great businesses that can be generated from that, and we'll show you this happening in real time downstairs. Two other examples, the C-SAM acquisition we had. Now our mobile transaction solutions. You can see how we're using it to help retailers engage with their customers better. Another great example is the Direct Express program from the U.S. government for people to receive Social Security benefits. Not only are we powering that prepaid program, we've actually developed the application to help consumers manage their accounts. It's a great example of the synergies in the business. We also know the key to digital is unleashing the power of third-party innovation. We also have our open API and services and how we're engaging with the developer community to use Mastercard services to extend the network and create all sorts of new solutions.
We've had a global set of hackathons. You'll see some of the results from that are out there, but how we can engage the development community in ways we never had before. One of the examples that Ann mentioned, and one that we're very, very proud of, which is Mastercard Aid. This is how we've taken capabilities that Mastercard had to address a real problem in ways that never could have been solved before, to safely and efficiently move benefit to the people who need it the most, when they need it the most, working with non-government agencies. It's not simply about getting them sustenance. This is also the first steps to financial inclusion and sustainable economic development in those communities. Driving preference for Mastercard.
You can see the loyalty solutions that Craig talked about earlier with Pinpoint and how that adds and enhances value. Things we're doing with Priceless, with Priceless Cities and the Priceless platform to make every Mastercard experience that much more valuable for cardholders. We end with the Mastercard network, that irreplaceable asset that ties all of this together globally. Again, I hope you take the opportunity to go in deep on some of the things we're talking about. Talk with the leaders who are driving these into the marketplace, and I think you'll really see this is how we've been able to gain share year-over-year. This is how we're diversifying our business by adding new services and capabilities and engaging with new partners and really see how we're bringing the strategy we discussed today to life.
With that, I really look forward to seeing you downstairs, and I will turn it to Ajay Banga for a few closing comments.
No. I'm done.
Ajay Banga has delivered his closing comments earlier during the Q&A session. With that, thank you, and I'll see you all downstairs.