As part of its CBDC Partner Program, Mastercard has joined hands with prominent CBDC leaders and payment giants to work along with the central banks to bring CBDCs to the market under a regulatory framework.
On Thursday, August 17, global payments giant Mastercard disclosed its CBDC partner program while naming initial partners as Ripple and ConsenSys. Top economies worldwide have been working on central bank digital currencies and thus payment giants like Visa and Mastercard have also shown interest in this.
In a recent press release, Mastercard unveiled this advancement, emphasizing the rising significance of Central Bank Digital Currencies (CBDCs) in the financial landscape, a trend strongly pursued by central banks.
This trend underscores the growing influence of CBDCs within finance. Consequently, Mastercard aims to capitalize on this mounting interest to solidify its stance within the CBDC domain. As part of its CBDC Partner Program, Mastercard has joined hands with prominent CBDC leaders and payment giants to work along with the central banks to bring CBDCs to the market under a regulatory framework.
Ripple is one of the top players in the CBDC world and is one of the first five partners chosen. Mastercard sees Ripple as a platform for CBDCs, which is because Ripple has been working a lot in the CBDC area. Recently, Ripple also started its own CBDC Platform. Mastercard also talked about how Ripple has been working with the Republic of Palau, which is a big accomplishment for them.
The new CBDC program is created to encourage working together with important people in this area. This was mentioned by Raj Dhamodharan, who is in charge of digital assets and blockchain at Mastercard. Dhamodharan added:
“We believe in payment choice and that interoperability across the different ways of making payments is an essential component of a flourishing economy. As we look ahead toward a digitally driven future, it will be essential that the value held as a CBDC is as easy to use as other forms of money.”
MasterCard’s CBDC Progress
This is not the company’s first push towards central bank digital currency (CBDC) development. Back in September 2020, Mastercard introduced a testing platform that central banks could use to assess CBDC systems. Then, in February 2021, the company began issuing prepaid cards in the Bahamas, which allowed users to convert the Sand Dollar, the CBDC of the country.
In a recent podcast interview with The Block, Dhamodharan emphasized the importance of flexibility, consumer protection, and privacy in building a CBDC that serves both businesses and consumers from the outset.
Although Mastercard didn’t provide specifics about the new program’s details, it highlighted the notion that CBDCs shouldn’t be implemented in isolation. The CBDC Partner Program aims to assist central banks in creating CBDCs that bring innovative value to the economy rather than being adopted without context.