Island Pay Partners Mastercard To Launch World's First CBDC-Linked Card

islandpay2 021821 lt

The Bahamas-based Island Pay has teamed up with the Central Bank of The Bahamas and payment processor Mastercard to launch what is claimed to be the world's first Central Bank Digital Currency or CBDC-linked card.

The Bahamas Sand Dollar prepaid card gives people the option to instantly convert the digital currency to traditional Bahamian dollars and pay for goods and services anywhere Mastercard is accepted on the Bahamas Islands and around the world.

Sand Dollar is the digital version of the Bahamian dollar (B$). Like cash, the Sand Dollar is issued by the Central Bank of The Bahamas through authorized financial institutions.

The digital Sand Dollar carries the same value and consumer protections as a traditional Bahamian dollar. The digital currency can be used to facilitate government disbursements, offer additional payment choices and build a more inclusive economy.

The CBDC is set to become a preferred digital payment in the region as cash money movement among the 700 small islands and more than 5000 square miles of water becomes costly. The Sand Dollar will also be offered to tourists in the future.

The Sand Dollar became the first fully- deployed digital version of a country's fiat currency in October 2020. It was initially piloted in 2019.

Sand Dollar was exclusively accessed by registered users initially through a digital app at select merchants. Island Pay mobile wallet users can now decide if they want to transact in Sand Dollars or Bahamian dollars at merchants using the mobile app.

Island Pay's technology platform, combined with Mastercard technology and wide merchant acceptance, has the potential to help reduce the operational distribution costs of cash and modernize the overall payments system in The Bahamas.

Mastercard has invested in the technology to be ready to explore and enable both CBDCs and privately issued stablecoins in partnership with governments, banks and fintechs.

Recently, Mastercard rolled out its proprietary virtual testing environment for central banks to evaluate CBDC use cases to enable the simulation of issuance, distribution and exchange of CBDCs between banks, financial service providers and consumers.

While the global economy racing to embrace digital payments, central banks also are looking to investigate and support innovation while maintaining monetary policy and financial stability as they issue and distribute currency.

For comments and feedback contact: editorial@rttnews.com

Business News

Follow RTT