At the moment, most regional trading hubs are dormant because they don't have viable online payment solutions, said Jeff Portelli, MasterCard International Asia Pacific senior vice-president.
Most of these hubs rely on offline payment methods, which defeats the purpose of having an online hub, he said, adding that most customers would also be reluctant to use hubs that don't offer "end-to-end" solutions.
"Also, if these hubs can't attract enough companies to go online then they can't function as hubs. It is a chicken-and-egg problem," he said.
A few trading hubs have some form of online payment for local trading, but they are at a loss when they have to do cross-border trading, Portelli said.
Trading hubs would be of particular interest to small to medium businesses (SMBs) because they can give SMBs the much-needed opportunity for cross-border trading.
MasterCard is working with Southern Bank Bhd in Malaysia to provide SMBs with a virtual credit card that can be used to make payments online, Portelli told reporters at a MasterCard "e-briefing" seminar in Singapore recently.
Southern Bank would be given the responsibility of setting the rules and regulations, and also vetting the companies, he added.
On another note, Portelli said that MasterCard is also working with Malaysian merchants to roll out its software that would allow companies to set up their own online stores.
The software would allow companies to design their own online markets and have their payment gateways linked to their preferred merchants, he said.
MasterCard said it has already passed the software to Malaysian merchants, who will then customise and repackage it to suit their clients.
