Mastercard will for the first time offer you the ability to send money over a blockchain rather than by swiping a credit card. Mastercard is known to have a liking for big digitization plans and innovation. Currently corporate giants like Google and Goldman Sach have invested heavily in blockchain to name a few apart from around 90 other corporate giants in the world. Mastercard has now decided to roll out blockchain API.
Finextra reported saying Mastercard has already filed for 35 blockchain patents and has supported the Digital currency Group which relates to blockchain, bitcoin and digital currencies innovation. This Friday, Mastercard announced it will open blockchain to certain banks and merchants as an alternative and potential method of efficiently making payment for goods and services.
With numerous industries like the real estate sector, health care etc are already using the blockchain as it enables transparency, speed and cost optimisation. The new technology will be explored by Mastercard in the B2B sector in order to leverage its position as a transparent cost competitive and fast operator.
Justin Pinkham, a senior vice president at Mastercard Labs, who leads the credit card company’s blockchain initiatives said –
“We are not using a cryptocurrency, and we are not introducing a new cryptocurrency, because that introduces other challenges—regulatory, legal challenges. If you do a payment, then what we can do is move those funds in the way that we do today in fiat currency.”
MasterCard Labs’, the innovation “body” of MasterCard, executive vice president, Ken Moore said – “By combining Mastercard blockchain technology with our settlement network and associated network rules, we have created a solution that is safe, secure, auditable and easy to scale. When it comes to payments, we want to provide choice and flexibility to our partners where they are able to seamlessly use both our existing and new payment rails based on the needs and requirements of their customers.”
Justin Pinkham further said that a number of corporations have already signed up for using the Mastercard blockchain but declined to name them. Mastercard has a vision for the future where its clients can use blockchain to track the movement of pharmaceuticals as well as luxury goods such as handbags and diamonds, thereby reducing fraud by providing “proof of provenance.”
He also stated saying it will be rather early to comment on individual consumers being able to pay via Mastercard blockchain instead of plastic. He also does not consider bitcoin as a threat to Mastercard in general.
Pinkham added saying – “Quite frankly, we feel that card payments are simple, safe and easier to use—and better meet the needs of consumers—than, let’s say, a cryptocurrency payment.”
According to Morgan Stanley, though the price of bitcoin has reached $5800 last week, the number of online retailers accepting payment in bitcoin has dropped to just three this year , compared with the 483 who accept Mastercard and Visa.
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