Published on 21 Nov 2022 on Zacks via Yahoo Finance
Mastercard Incorporated MA is riding on cross-border volume growth, which is evident from its past few quarters’ performances. As travel restrictions continue to disappear, MA’s cross-border volumes are paving way for lucrative growth. The metric has significant weightage in the company’s revenue generation. Also, geographical expansion and Digital First solutions will keep triggering growth.
In the first nine months of 2022, cross-border volumes (a key measure that tracks spending on cards beyond the issuing country) soared 51% year over year on a local-currency basis. During this period, the metric comprised 29.3% of Mastercard’s net revenues compared with 24% a year ago. Things are not expected to cool down yet.
In 2019, cross-border volume fees comprised 33.2% of Mastercard’s net revenues before the COVID-19 pandemic struck down traveling. In 2020, cross-border volume fees plunged 37%. Given the current environment, where international travel continues to recover, Mastercard’s cross-border volume fees are bound to go up.