Mastercard to issue prepaid card supporting Bahamas CBDC

The Mastercard payment system plans to issue a prepaid card supporting the central bank digital currency (CBDC) of the Bahamas.

Using the Island Pay mobile app, residents will be able to use the Sand Dollar to pay for goods, services and bills or to convert instantly into fiat currency. The value of the digital asset is pegged to the Bahamian dollar.

Raj Dhamodharan, head of Mastercard’s blockchain unit, noted that the company is expanding payment options for consumers, merchants and authorities.

“This partnership has shown how the private and public sectors can rethink new possibilities while providing a high level of consumer protection and complying with regulatory requirements,” said Dhamodharan.

Bahamas Central Bank governor John Rolle pledged to encourage fintech development with CBDC support.

Testing of the Sand Dollar began in December 2019. In October 2020 the Bahamas CBDC became available to everyone. The central bank plans to use the currency outside the country.

What is central bank digital currency (CBDC)?

In February, Mastercard promised to implement direct support for digital assets. The previous competitor payment system Visa presented similar plans in its cryptocurrency strategy.

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