As central bank digital currencies (CBDCs) grow in popularity, the world’s payments leaders are making preparations.
On a recent earnings call, Mastercard CEO Michael Miebach discussed the company’s plans to support CBDCs, Securites.io noted in a Tuesday (Nov. 2) report.
“We are saying at this point in time, the most likely chance for this kind of technology to work for payments is if it’s issued through a government in the form of a CBDC,” he said.
“We said that on a couple of calls before, and we said that we will make our network ready to do that as and when a government is ready to put out a CBDC that will exist alongside the dollar or the euro as a settlement currency in our network.”
This will mean developing a “sandbox” to test payments on the Mastercard network. Miebach said this sandbox would offer a “safe space for governments and private sector banks to figure out how that would actually work.”
Learn more: Nigeria to Debut Its eNaria Currency
This is happening against the backdrop of the recent launch of the eNaria, the first Nigerian CBDC, which rolled out last week along with wallets for merchants and consumers.
Nigeria’s government says the CBDC will offer numerous benefits, including financial inclusion, lowered financial transaction costs, increased tax collection and revenue and a more transparent distribution of welfare.
“The eNaira therefore marks a major step forward in the evolution of money, and the CBN is committed to ensuring that the eNaira, like the physical Naira, is accessible by everyone,” the Nigerian central bank said in a statement.
China is getting closer to rolling out its CBDC — the plan is for the digital yuan to be ready in time for the 2022 Winter Olympics and is pushing merchants to accept the new currency. As reported here last month, that includes McDonald’s.
The chain has offered a trial of digital offering at 270 locations, but the Chinese government wants to see that program widened, while also pushing for CBDC rollouts with Nike and Visa.