Three months ago, the Bahamas launched the world’s first-ever central bank digital currency, the Sand Dollar. The Caribbean island has once again set another milestone, availing its citizens the first-ever CBDC-linked debit card.
Local payments firm Island Pay partnered with global giant Mastercard on the prepaid card. It will allow Bahamians to instantly convert their Sand Dollars to traditional fiat currencies and pay for goods and services. They can use the card globally on any merchant store that accepts Mastercard.
The Bahamas launched the Sand Dollar after years of development as it sought to insulate its financial system against the constant disruptions that occur whenever the country experiences a natural disaster. Its most devastating so far has been Hurricane Dorian which took over 70 lives and left over $5.1 billion in damage.
The Central Bank of the Bahamas launched the CBDC to ‘full-proof’ its financial system in the event of such a tragedy. It allows the citizens to transact in the absence of a bank or an internet connection.
John Rolle, the central bank governor commented on the Sand Dollar card, stating, “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.”
Mastercard’s involvement in the project is its latest effort in establishing itself in the CBDC and blockchain world. It already has 89 blockchain patents to its name, with 285 others pending. It’s also working with select digital currency payment providers including BitPay and Uphold to enable instant payments. However, it exited the Libra Association despite being a founder member.
Raj Dhamodharan, the vice president of digital assets and blockchain at Mastercard remarked, “We’re creating a lot more possibilities for governments, shoppers and merchants, allowing them to transact in an entirely new form of payment.”
Mastercard has reiterated that it’s seeking to evolve with payments in the digital era, offering its users the choice to use digital currencies. “It’s about choice. Mastercard isn’t here to recommend you start using cryptocurrencies. But we are here to enable customers, merchants and businesses to move digital value,” the company stated while announcing digital currency integration last week.