Mastercard is an American multinational financial corporation providing secure and fast financial services in more than 210 countries and territories. This blockchain API, aimed to Mastercard’s customers, will become new method of transactions in the sphere of B2B payments. The main goals of this blockchain API is to provide speed, transparency and lower costs in cross-border payments in order to meet every need of financial institutions and their end-customers.
The Mastercard blockchain API will be part of the Money 20/20 hackathon in Las Vegas next week
Mastercard ensures that blockchain API is based on privacy, flexibility, scalability, and the reach of the company’s settlement network.
“By combining Mastercard blockchain technology with our settlement network and associated network rules, we have created a solution that is safe, secure, auditable and easy to scale. When it comes to payments, we want to provide choice and flexibility to our partners where they are able to seamlessly use both our existing and new payment rails based on the needs and requirements of their customers,” executive vice president of Mastercard Labs Ken Moore said.
The main blockchain API advantage is wide network that includes 22,000 financial institutions around the world.
“What Mastercard brings to the table here is a unique combination of that blockchain capability and Mastercard’s settlement network,” senior vice president at Mastercard Labs Justin Pinkham said.
Mastercard is always interested in implementation of distributed ledger technology for payments in order to facilitate and secure transactions. The payment giant took the first steps in this direction in the end of 2016 – added three blockchain APIs to its developer site.
“Mastercard’s announcement that it will be opening up access to its blockchain technology via its API published on Mastercard Developers is very significant,” says Matt Shaw, Director at Synechron. “It should not be dismissed as a ‘technology hedge’ for Mastercard to ensure themselves against the threat of new entrants into the cross-border B2B payments market, such as Ripple.”
He continued: Mastercard’s announcement shows a real-world implementation of blockchain backed by a large, well-established global payment operator with the brand strength and extensive customer network to gain trust and adoption, furthering digitalization in the industry and bringing innovative emerging technology to a broader mainstream consumer base. In time, if the platform fulfills its promise and offers Mastercard lower operational costs and risks it could result in the demise of their existing networks.”
According to Mastercard, “the blockchain facilitates new commerce opportunities for the digital transfer of value by allowing businesses and financial institutions to transact on a distributed ledger”.
In April 2017, the credit card giant announced a new biometric card that allowed customers to complete transactions without entering their personal identification number.
It should be added, that in July Mastercard joined the Enterprise Ethereum Alliance to explore the possibilities of the ethereum blockchain and exceed the scope of Mastercard’s traditional payments environment.
However, Mastercard is not the only financial corporation that plans to establish blockchain-based cross-border payment networks.
Earlier this week, IBM announced partnership with a Polynesian payments system provider and an open-source FinTech payment network in order to implement a new international exchange based on blockchain electronic ledger.
In September 2016, MasterCard’s rival Visa teamed up with BTL Group, a digital payments start-up, to adapt blockchain for processing interbank payments. Moreover, Visa plans to create its own system for B2B payments through partnership with blockchain startup Chain.