Mastercard Inc is joining the competition for big spenders, announcing a higher-yet tier of rewards card designed to help banks challenge offerings from Chase, American Express and Capital One, among others.
The company plans to debut the World Legend category with one of the firm’s largest US partners before the end of September, according to Bunita Sawhney, Mastercard’s chief consumer product officer.
It is joining an increasingly crowded field, as issuers sharpen their focus on the small, high-income cohort of US consumers that account for the majority of the country’s spending.
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JPMorgan Chase & Co increased the annual fee on its popular Sapphire Reserve to $795 last month. American Express Co has said it plans to refresh its $695-per-year Platinum card in the fall. Capital One Financial Corp has found some success with its upper-middle Venture X card, and Citigroup Inc – a longtime issuer of Mastercard-branded cards – said Tuesday that it would introduce a new “Strata Elite” card in the fall.
Mastercard also announced dining, entertainment and travel benefits – known as the Mastercard Collection – for World, World Elite and, eventually, World Legend cardholders. Individual banks may also add their own rewards on top of what the payment company offers.
“As long as it’s very clear and transparent to the consumer what they get, they’re willing to pay for it,” Sawhney said.
Like the banks that issue the cards, the payment networks also benefit from higher volume and bigger-ticket purchases. Offering their partners a base of benefits – on top of which the banks can build – is a way for Mastercard, Visa Inc and Amex to compete with each other. Visa, for example, is the partner for Chase’s Sapphire cards and Capital One’s Venture X.
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Mastercard’s new rewards include priority access to reservations via a partnership with the European restaurant booking platform TheFork, ticket presales and streamlined airport security access, the company said. The new World Legend echelon is available to banks globally, but it is up to the issuers to make them available to consumers.
