Mastercard Launches Central Bank Digital Currencies (CBDCs) Testing Platform, Enabling Central Banks to Assess & Explore Nati...
September 09 2020 - 8:00AM
Business Wire
- Innovative virtual and custom testing platform allows central
banks to evaluate use cases and test roll-out strategies for CBDCs
by simulating a CBDC ecosystem
- Central banks, commercial banks, and tech and advisory firms
invited to partner with Mastercard to evaluate the suitability of
CBDCs in a country or region
With the global economy racing to embrace digital payments,
central banks also are looking to the future and investigating how
to support innovation while maintaining monetary policy and
financial stability as they issue and distribute currency. In fact,
80 percent of central banks surveyed are engaging in some form of
Central Bank Digital Currencies (CBDCs) work, and about 40 percent
of central banks have progressed from conceptual research to
experimenting with concept and design, according to a recent survey
by the Bank for International Settlements.
Today, Mastercard announced a proprietary virtual testing
environment for central banks to evaluate CBDC use cases. The
platform enables the simulation of issuance, distribution and
exchange of CBDCs between banks, financial service providers and
consumers. Central banks, commercial banks, and tech and advisory
firms are invited to partner with Mastercard to assess CBDC tech
designs, validate use cases and evaluate interoperability with
existing payment rails available for consumers and businesses
today.
Mastercard is a leader in operating multiple payment rails and
convening partners to ensure a level playing field for everyone –
from banks to businesses to mobile network operators – in order to
bring the most people possible into the digital economy. Mastercard
wants to harness its expertise to enable the practical, safe and
secure development of digital currencies.
“Central banks have accelerated their exploration of digital
currencies with a variety of objectives, from fostering financial
inclusion to modernizing the payments ecosystem," said Raj
Dhamodharan, Executive Vice President, Digital Asset and Blockchain
Products and Partnerships, Mastercard. “Mastercard is driving
innovation with the public sector, banks, fintechs, and advisory
firms in the exploration of CBDCs, working with partners that are
aligned to our core values and principles. This new platform
supports central banks as they make decisions now and in the future
about the path forward for local and regional economies,”
Dhamodharan added.
Sheila Warren, Head of Blockchain, Digital Assets and Data
Policy at the World Economic Forum, said: “Collaborations
between the public and private sectors in the exploration of
Central Bank Digital Currencies can help central banks better
understand the range of technology possibilities and capabilities
available with respect to CBDCs. Central banks can benefit from
support in exploring the option set available to them with respect
to CBDCs, as well as gaining insight into what opportunities may be
forthcoming.”
CBDCs are designed to be equivalent in value to a nation’s paper
currency and subject to the same government-backed guarantees. In
addition to printing money, central banks can issue CBDCs as a
digital representation of a country’s fiat currency.
Driving Scalable Innovation
While a variety of potential operating models exist, the primary
approach sees central banks issuing and distributing currency,
including digital currencies, through commercial banks and other
licensed payments providers. Mastercard understands every central
bank differs in its exploration of CBDCs, and the platform stands
ready to explore whether CBDCs fit with the needs of a region or
country. The virtual platform can be individually customized to the
environment in which the central bank operates, allowing them
to:
- Simulate a CBDC issuance, distribution and exchange ecosystem
with banks and consumers, including how a CBDC can interface with
existing payment networks and infrastructures – e.g., cards and
real time payments.
- Demonstrate how a CBDC can be used by a consumer to pay for
goods and services anywhere Mastercard is accepted around the
world.
- Examine various CBDC technology designs and use cases to more
quickly determine value and feasibility in a market.
- Evaluate CBDC development efforts including the technical
build, security and early testing of the design and
operations.
Central Bank Digital Currencies of the Future
Mastercard is committed to supporting central banks in their
chosen path to modernize payments as they look for solutions that
seamlessly integrate with existing ways to pay. The company is
committed to forging partnerships between public and private
sectors to together transform the way people and businesses
transact.
About Mastercard (NYSE: MA), www.mastercard.com
Mastercard is a global technology company in the payments
industry. Our mission is to connect and power an inclusive, digital
economy that benefits everyone, everywhere by making transactions
safe, simple, smart and accessible. Using secure data and networks,
partnerships and passion, our innovations and solutions help
individuals, financial institutions, governments and businesses
realize their greatest potential. Our decency quotient, or DQ,
drives our culture and everything we do inside and outside of our
company. With connections across more than 210 countries and
territories, we are building a sustainable world that unlocks
priceless possibilities for all.
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Katie Priebe Global Communications +1 (914)
707-9822 | Katie.Priebe@mastercard.com
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