Mastercard and Microsoft are teaming up to help cities better understand and address urban planning challenges like traffic congestion and economic development.

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The two companies are currently working on a two-city pilot that will model the impact of planned and unplanned urban events and inform policy decisions with data.

The idea is to give mayors, policy makers and urban planners more insight into the root causes of urban challenges -- like major infrastructure investments, adverse weather and traffic incidents -- and better strategies on how to solve them.

Using Mastercard's payment network and Microsoft's data analytics and cloud technologies, the companies will also look for smart city solutions in the areas of transportation -- including the potential for a cloud-based automated transit fare collection system -- as well as tourism, water and power.

Microsoft will also join Mastercard's City Possible[3] initiative, a global effort that encourages cities and businesses to co-create and scale solutions to urban problems. Meanwhile, Mastercard's payment technologies will be embedded in Microsoft's CityNext program, which pushes digital transformation in smart cities.

"Microsoft CityNext is helping cities implement solutions that address their most pressing needs and harness the next generation of innovation by leveraging cloud computing, AI, and other technologies," said Trudy Norris-Grey, managing director of Microsoft

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