Mastercard and City Union Bank Pilot Mastercard One Credential in India Amid High SME Demand for Digital Payments

Indian small and medium enterprises (SMEs) are exhibiting strong demand for flexible and real-time digital payment solutions. According to Mastercard’s Dreamonomics Report released on Thursday, 63 per cent of Indian SMEs expressed interest in real-time payments, a figure that sits well above the Asia Pacific average of 51 per cent.

The findings are based on a 2026 survey covering over 6,000 SMEs across 18 countries. The report further indicated that 45 per cent of Indian SMEs are open to flexible digital payment solutions, while 39 per cent showed interest in a combined credit-debit business card equipped with enhanced spending controls.

To address these evolving payment needs, Mastercard and City Union Bank have initiated a pilot of Mastercard One Credential in India. This marks the country’s first initiative designed to consolidate multiple eligible consumer and commercial payment relationships under a single card credential. The product operates by routing transactions according to preset preferences, such as specific transaction amounts and merchant categories, which assists SMEs in separating their personal and business expenses.

Regionally, the Dreamonomics Report points to a growing operational complexity challenge for businesses. Across the Asia Pacific, SMEs utilize an average of five business tools alongside four distinct payment methods, including instant payments, electronic bank transfers, and traditional debit and credit cards. While this multitude of choices provides operational flexibility, it simultaneously introduces reconciliation friction and visibility gaps regarding cash flow.

Additionally, security remains a critical concern for the sector. Seventy per cent of Asia Pacific SMEs identified cyber threat protection as essential, yet only 39 per cent currently deploy cybersecurity tools. On the technology front, nearly three in four SMEs indicated enthusiasm for artificial intelligence, with fraud protection standing out as the most desired AI capability from financial service providers.

"The high demand for real-time payments among Indian small and medium enterprises highlights a clear shift toward operational efficiency and better cash flow management. Initiatives like the Mastercard and City Union Bank pilot address a genuine friction point in business operations—the separation of personal and commercial expenses. As SMEs increasingly adopt digital tools, financial institutions that simplify reconciliation and enhance fraud protection will find strong market adoption." — Dr. Shishir Gupta, Founder & CEO, StartupLanes