MasterCard International and EC Cubed Inc., a provider of e-commerce application components, announced on Tuesday a technology alliance intended to boost MasterCard’s business-to-business e-commerce software infrastructure. Kicking off the deal, the companies intend to jointly develop an Internet-based data capture system for MasterCard’s Corporate Purchasing Card, which is used by organizations to monitor and control their procurement spending.
Last year, EC Cubed raised $11.5 million (US$) in venture capital from investors that include Battery Ventures, BancBoston, Walden Group and Crystal Internet Ventures. The funding has enabled EC Cube to establish its presence in the business-to-business e-commerce arena. In addition to this latest deal with MasterCard, EC Cubed also lists the Gartner Group, Transamerica Leasing, Inc., and Pinnacle Systems as its clients and strategic partners.
According to Steve Abrams, senior vice president of U.S. Corporate Products at MasterCard, “We’ve found a technology approach that fits with our strategic goal of offering a turnkey solution for Internet-enabled purchasing that delivers line item data to corporate buyers without the need for merchants to invest in changing their payment infrastructure to accommodate Level 3 processing.”
EC Cubed’s application component suite, ecWorksTM, will provide the underlying infrastructure needed to create an Internet “Commercial Card Gateway” through which purchase order data is transmitted from any front-end electronic procurement software solution to the MasterCard purchasing card system. The MasterCard Commercial Card Gateway will significantly extend MasterCard’s data reporting capabilities, providing corporate purchasing departments with the line-item, Level 3 data needed to better track and control enterprise-wide spending via the Internet. Companies can then use this detailed data for cardholder reconciliation and general ledger accounting integration.
“The integration of buy-side electronic commerce and payment solutions will be vital to the future of e-procurement initiatives,” said Kip Martin, senior research analyst at the META Group. “In addition, companies pursuing e-procurement solutions will require both usable management reports and the ability to integrate their systems with those of trading partners, if they are to effectively extend business processes outside the organization.”
EC Cubed’s open-standards approach reportedly ensures that the jointly developed solution will be compatible with “any pre-packaged or custom procurement application.” MasterCard will pilot the Commercial Card Gateway internally, before extending it to their member banks as a commercial solution later this year. Beta development of the solution is set to commence immediately.