MasterCard has repeated earlier claims that the company will get on board with any government-backed digital currencies.
MasterCard is receptive to the idea of using central bank-issued national digital currencies in the future, according to the co-president of Mastercard’s Asia-Pacific business, the Financial Times reported today, March 19.
Senior MasterCard executive Ari Sarker told the Financial Times that “if governments look to create national digital currency we’d be very happy to look at those in a more favourable way [as compared to cryptocurrencies in general]”:
“So long as it’s backed by a regulator and the value . . . it is not anonymous, it is meeting all the regulatory requirements, I think that would be of greater interest for us to explore.”
Ajay Banga, the CEO of MasterCard, had also said last fall that MasterCard would find a “way to be in the game” for government-created digital currencies, labelling all other cryptocurrencies without government-backing as “junk.”
Government-issued currencies have been discussed in several countries globally, but as-of-yet the centralized crypto phenomenon has not been realized by most. The most notable example of a successfully-issued state crypto is the Venezuelan Petro, which was recently released under a cloud of controversy.
Sarker also said that MasterCard was currently running a Bitcoin (BTC) pilot program in Japan and Singapore that would allow BTC holders to cash out onto a MasterCard, adding that the program involves both KYC and AML components:
“We are not operating trading of bitcoin through the MasterCard network […] [The pilot] is a toe in the water, we’re fully cognisant of the reputational risk.”
The Financial Times notes that both MasterCard and Visa had “reclassif[ied]” BTC purchases as “cash transactions,” a move with added fees for their crypto customers.
Mastercard had filed a patent for instantaneous payments using Blockchain technology in November of last year, and a MasterCard spokesperson notes that MasterCard Labs has filed for over 30 “patents related to blockchain technology and cryptocurrency:”
“MasterCard Labs is working on a Blockchain technology that will support a wide range of use cases, including but not exclusive to [business to business]interbank payments, tracking trade finance obligations along the value chain, exchanging know your customer and anti-money laundering data between trusted parties, and more.”
Sarker also added that MasterCard is running pilot programs in Singapore and Australia for contactless payment transport system.
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Author: Molly Jane Zuckerman