HSBC and Mastercard bring their resources and expertise together in a new partnership to spearhead innovative and sustainable solutions to urban development.
On the back of the COVID-19 pandemic, there has been a drive to more sustainable urban development. Digitisation is helping cities around the globe rebuild their lockdown-hit economies, as well as find solutions to other pressing issues like social unrest and climate change.
HSBC Group and Mastercard recently partnered on the City Possible initiative, which will work to co-create frameworks for cities through collective resources, expertise, and innovative and sustainable urban development solutions to the network.
In parallel, HSBC MENAT was home to the first customer execution of the new partnership, with a Group first HSBC Mastercard Power of Partnership Webinar Series, with the first episode focusing on urban tech and digital economisies fit for the future.
Connecting industries, expertise and networks from East to West, the Power of Partnership Webinar Series will discuss a range of hot-topics transforming global cities today, including: urban tech, digital economies, financial inclusion, cashless societies, the rise of new cities and districts and sustainable development and livable cities.
"Our partnership with HSBC aims to accelerate sustainable urban development,” said Raghu Malhotra, president of MEA at Mastercard. "Our combined resources along with HSBC will make this partnership stronger,” he added.
Track record in sustainability
With a firm focus on sustainability, HSBC represents a powerful addition to the project, bringing decades of experience in developing financing and managing urban development projects, as well as serving thousands of private and corporate customers across 62 markets and 300 cities globally. The bank also aims to mobilise $100 billion in sustainable financing by 2025.
"HSBC and Mastercard are brilliantly compatible partners in this City Possible initiative,” said Greg Clark, Global Head of Future Cites and New Industries, HSBC.
"We work for the future of the planet with a deep commitment to sustainable finance and the climate transition,” he added.
In 2018, Mastercard launched City Possible, a partnership and co-creation network where 181 global cities – both big and small – can draw on their collective expertise and resources to tackle urban challenges and build more resilient and inclusive communities.
“We are absolutely thrilled to have HSBC join this movement and bring their expertise and assets to the table to advance this inclusive innovation approach to addressing the most pressing issues that cities are facing all around the world,” said Miguel Gamino, Executive Vice President of Global Cities, Mastercard.
While cities had faced challenges stemming from natural disasters, climate change and social inequality well before COVID-19, the pandemic added a layer of urgency to the City Possible initiative.
Predictions show that the global urban population will triple between 1980 and 2080, bringing the possibility of both good and bad urbanisation.
Bad urbanisation is currently associated not just with congestion, crime and inequality, but also with contagion. At the same time, nearly 500 cities are vulnerable to a half-metre rise in sea levels between now and 2050 as a result of global warming.
Cities are both producers of climate change, and they are the victims of it. So they have major incentives to use technology to help them mitigate climate change, but also to adapt to it
Through its City Insights data platform, Mastercard, which runs initiative programmes for more than 40 governments and over 300 projects around the world, also helped New York City analyse the economic consequences of COVID-19 lockdowns.
“We are already starting to contribute to the thinking about post-COVID, and how we can make these economies not only just come back but come back stronger, safer and more resilient and inclusive over time,” Gamino said.
Consumption behaviour changed significantly due to COVID-19, resulting in a strong divergence in market performance across economic sectors and reflecting investors views on long term-impacts and shift to the new normal.
Roughly half of U.S. consumer spending could be adversely affected by the pandemic with restaurants and hotels the most hit with a massive 90 percent change in spending in the second quarter, according to HSBC Global Research.
In the MSCI World index, which tracks 1,640 companies across 28 countries, winners included businesses operating in health, food, digital and remote services, while losers were those facing consumer behaviour changes and delays of non-essential spending.
Across the world, corporates took a series of both operational and financial measures to mitigate the impacts of the pandemic such as cost reduction programmes, layoffs, suspension of dividends and delays in capital expenditure and expansion.
According to Clark, COVID-19 has seven mid to long-term socio-economic implications related to supply chain diversification, digital transformation and servicisation of the economy, focus on health and wellness, sustainable economy drive, new spatial patterns, geo-political changes and new social contract with more inclusion and tackling of inequalities.
Tackling climate change
COVID-19 has accelerated the process of technology adoption, making cities more responsive to citizens and creating opportunities to host different economic models that over the last decade merged into integrated corporate super clusters using new cutting-edge technologies in what is called a circular economy.
As integrated companies are critical providers of services to cities, figuring out partnerships that bring benefits from integration and collaboration is important, Clark said.
The cities must also now focus on how they can use digital technologies to draw people again to face-to-face experiences, regaining public trust by addressing issues like cleanliness, hygiene and security.
“It is important that we start to enjoy cities again as soon as we can. Cities attract populations because they are places of fun," Clark said.
"Digital technologies are a tool to make places great again. They are not just a competitive alternative channel,” he said.
HSBC and Mastercard are brilliantly compatible partners in this City Possible initiative. We work for the future of the planet with a deep commitment to sustainable finance and the climate transition