12 FORTUNE DECEMBER 2020 /JANUARY 2021tions make a big difference because
they create multiplier effects far be-
yond the check that you write. That
was my second learning. But when
I came to Mastercard, I found that
my biggest competitor was not other
forms of electronic payment—a Visa
or American Express. No, our real
competition was cash. Cash was 85%
of all retail transactions at that time.
So cash comes from governments.
The largest single source of cash in
an economy is the government. It’s
veterans’ payments, Social Security,
salary, pensions, benefit distribution,
all that.
We decided we’re going to go after
cash—but 2 billion people were
excluded from the financial system,
and many were getting these benefits
from government. That led us into
the financial inclusion space. And so
we kind of backed into it from very
strong commercial reasons. How do
you go after the 85%? We found that
our technology and our partnerships
could make a difference. That made
it commercially sustainable.COVID-19 has greatly limited travel
and cross-border commerce, which
are key to your business. What are
the near- and medium-term out-
looks for Mastercard?
We said we would manage the
company through four stages: con-
tainment, stabilization, normaliza-
tion, and growth. Containment was
the free fall of March/April, when
everything was shutting down. The
world was shutting down. Stabili-
zation was the bottom end of that
cycle. People had to buy toilet paper
and medicines, but that was about it.
Normalization is not really normal.
Compared to stabilization, it feels
normal. But, you know, there’s no
mass sporting events. There’s no
travel in the way we used to travel.
We’ve all got to wear masks in public.
We’re not going out with friends to
a party. That’s not normal, but it’s a
new normal.
Most countries seem to be at someYou mentioned financial inclusion.(^3) Why is this so fundamental?
When I was at Citi in India, a col-
league began teaching me about the
power of microfinance. And I began to
comprehend how you can actually get
even the poorest women to become
economically independent through
microfinance. And if you do that, then
she makes her family better off, and
so you get a multiplier factor that is
many times what you would get just
for giving one person more money.
Which you saw as a business model
too.
Yes, commercially sustainable solu-
You’ve said that
“inclusion is a fancy
word for human decency.
How so?
I think decency is the bedrock of
defining what makes us humans.
Decency doesn’t mean being nice
to everybody. It means being fair to
everybody. When I was young, your
IQ is what made you supposedly
stand out. And then when I got to
business school, people began talking
about EQ. You know, you couldn’t
choose your boss or colleagues, but
how you conducted yourself with
equanimity showed that you had the
emotional quotient to be successful.
And I say you need DQ—your
decency quotient—when you come
to work every day. Because you have
to bring your heart and your mind
to work. You have to care about the
people who work with you, for you,
above you, around you. That’s where
inclusion comes in. If I can make it a
part of my business, then I can bring
the whole company to the party.
BETWEEN THE
LINES
(1) From success
to succession: On
Jan. 1, 2021, Banga
hands the CEO reins
over to Mastercard
president Michael
Miebach. Banga will
stay on as executive
chairman.
(3) Bringing
everyone into the
game: In April, Mas-
tercard pledged to
bring 1 billion people
and 50 million micro
and small businesses
into the digital
economy by 2025.
After the killing of
George Floyd, the
company also com-
mitted $500 million,
and partnered with
Black-owned fintech
MoCaFi and others,
to enhance financial
security and help
small businesses in
Black communities
in the U.S.
THE CONVERSATION AJAY BANGA
(2 ANNUAL
PROFITS
2010 2019
$1.85 BILLION
$8.12 BILLION
SOURCE: S&P GLOBAL