Mastercard proposes paying half the disputed $950 million from the Will Bank collapse and providing multi-year fraud protection, sources told Bloomberg. The liability dispute continues.
Alpha Score of 73 reflects strong overall profile with strong momentum, moderate value, strong quality, strong sentiment.
MA stock page Mastercard is offering to pay half the amount Brazilian merchant acquirers claim they are owed after the collapse of Will Financeira, or Will Bank, a FinTech tied to Banco Master, Bloomberg reported Friday, citing unnamed sources. The company is also proposing to provide the firms with services such as fraud protection for multiple years, according to the report.
The offer follows an earlier proposal from Mastercard in the fallout of Will Bank's collapse. The January collapse left Mastercard on the hook for about $950 million to other parts of the network. Mastercard settled roughly half that amount but has been disputing the other half with the acquirers, the report said.
Mastercard said in a statement:
"We have been working through this situation closely with the liquidator and the regulator to minimize any potential impact on the payments ecosystem."
The company added that it is waiting for another transfer from the liquidator. "That settlement will happen once those outstanding funds are received from the liquidator."
The dispute centers on liability. Mastercard said it was required to pay for bills due the month after Will Bank's liquidation. Acquirers argued it is responsible for the full amount, per the report.
Brazil's central bank halted Banco Master's operations in November and named a liquidator to handle creditor claims and sell assets. Police arrested the bank's controlling shareholder the same day. Banco Master had struggled with liquidity pressures after growing quickly by selling high-yield debt through investment platforms.
In May, Mastercard asked some of Brazil's largest payment processors to split the losses. At the time, Mastercard had paid about half and proposed using money collected from card customers to reimburse itself before passing more funds to acquirers.
The central bank adopted new rules making payment networks responsible for ensuring all transactions are paid to the receiving user. Mastercard told acquirers it should not be bound by those rules in the Will Bank case because the FinTech collapsed in January, before the May deadline for compliance.
Mastercard carries an Alpha Score of 65 out of 100, a Moderate rating, according to AlphaScala's proprietary model.
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