MasterCard Worldwide needs to catch up in the debit card market to meet its own goals, Timothy H. Murphy, president, U.S. region, told analysts during a conference last week. "We acknowledge the perception that MasterCard is late to the game in debit in the U.S., and we are not satisfied with our position," Murphy said. Debit is the fastest-growing type of payment in the U.S., and it represents the greatest opportunity to convert more payments from cash and check to the MasterCard network, Murphy noted, adding that approximately 90% of U.S. households have a debit card linked to a bank account. But the surprising fact is that activation of issued debit cards is still relatively low, and by some measures only about half of all debit cards issued have been activated, he said. To spur greater use of debit cards, MasterCard is consulting with its issuers on strategies to increase the distribution and use of its PayPass contactless technology, and on driving the development of signature debit and co-branded debit cards and rewards. Prepaid debit cards and converting consumer bill payment to debit cards are other growth areas, Murphy said. He suggested that large municipalities, such as the city of Sacramento, Calif., which this year began accepting one-time payment of utility bills using debit and credit cards, will drive this trend.

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