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Mastercard and Island Pay launch CBDC linked prepaid card in the Bahamas

Mastercard and Island Pay launched a prepaid card which allows users to transact using the Central Bank of The Bahamas issued digital currency - Sand dollar, and exchange it for Bahamian dollar in any shop that accepts Mastercard

February 23, 2021 | Kevin Luarca
  • Mastercard and Island Pay partnered to launch a prepaid card linked to the Sand dollar
  • The Sand dollar was earlier launched in October through authorised financial institutions
  • The card allows users to pay for goods and services and exchange Sand dollar for Bahamian dollar anywhere Mastercard is accepted

Mastercard and Island Pay have launched what they claim to be the world’s first central bank digital currency (CBDC) linked prepaid card in The Bahamas. The prepaid card allows users the option to instantly convert the digital currency to traditional Bahamian dollars and pay for goods and services anywhere Mastercard is accepted, according to a press release.

The Sand dollar, launched in October 2020, is the official digital currency issued by the central bank and carries the same value and protection as the Bahamian dollar (BSD). Similar to the BSD, the Sand dollar is backed by the country’s foreign reserves and is regulated and monitored by the Central Bank of The Bahamas. It can be used for retail payments, government disbursements, and other transactions through authorised financial institutions. It also supports an ‘offline functionality’ wherein built-in safeguards will allow users to make a pre-set dollar value of payments when communications access to the Sand dollar network is disrupted. The wallets will update against the network once communications are re-established.

John Rolle, governor of Central Bank of The Bahamas, said, “We welcome this approach to combining digital currency use with access to foreign currency and other payment outlets. The Central Bank of The Bahamas will continue to encourage fintech developments that tie into the Sand dollar infrastructure while allowing us to satisfy best global practices for regulation of the space”.

Raj Dhamodharan, executive vice president of digital asset, blockchain products, and partnerships, Mastercard, said “This partners...

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Keywords:Digital Payments, Cbdc, Blockchian, Anti-money Laundering