MasterCard Inc. became the first payments network to issue a license to a Myanmar bank as the Southeast Asian nation moves toward integrating with the global financial system after decades of military rule.
MasterCard entered the agreement this month with Myanmar's Co-Operative Bank Ltd., which has the largest network of automated teller machines in the country, according to a statement today. The license will allow the bank to issue MasterCard-branded cards and enable merchants to accept them, according to the statement.
"Once you have three or four banks it becomes far more efficient to both educate the dealers and advertise in a meaningful manner," Vicky Bindra, MasterCard's president for Asia-Pacific, the Middle East and Africa, said by phone yesterday. "We're trying as quickly as possible. I'm hoping one year down we'll have a much better picture."
Myanmar's policy makers are taking steps to make it easier to transfer money as they seek investments and tourism following a shift to democracy after about five decades of direct army rule. President Thein Sein dismantled a fixed exchange-rate in April and parliamentarians are revamping investment laws in the country of 64 million people, attracting companies such as Coca- Cola Co. and Honda Motor Co.
Visa Inc. announced last month it would undertake training workshops in Myanmar to prepare banks for electronic payments. MasterCard will run its operations out of Vietnam until Myanmar becomes more developed, Bindra said.
"At some stage we will have an on-the-ground presence in Myanmar," he said. It may take five or 10 years before the electronics payments market grows to a significant size, he said.
Co-operative Bank was set up in 1992 and has more than 20 ATMs in Myanmar, according to its website. It is one of 19 private banks in the country, according to the central bank.
Myanmar's economy may grow as much as 8% a year over the next decade if inflation remains low and the government increases trade ties with neighbors China and India, the Asian Development Bank said in an Aug. 20 report.
President Barack Obama in July authorized U.S. companies to invest in Myanmar for the first time in about 15 years. Thein Sein met Secretary of State Hillary Clinton at a July 13 business forum in Phnom Penh, Cambodia, that included representatives from Google Inc., Goldman Sachs Group Inc., Boeing Co. and General Motors Co.