The Central Bank of the Bahamas is working with Mastercard and Island Pay to improve the utility of the country’s Sand Dollar digital currency. The partnership will specifically allow users to convert Sand Dollars to ordinary Bahamian dollars. That, in turn, will allow them to use those Sand Dollars to pay for goods and services beyond the Bahamas, since they will be able to use those Dollars at any location in the world where Mastercard is accepted.
The Bahamian Sand Dollar is worth just as much as the country’s regular dollar, and is issued directly by the Central Bank. The digital currency was piloted in 2019 ahead of a full launch in October of 2020, and is designed to raise financial inclusion since physical cash is not always an ideal method of payment in a country composed of islands and large stretches of ocean. However, the program was initially quite limited, and registered users could only use the digital app to make purchases from a select number of participating merchants.
With the new update, customers will instead be able to choose whether to pay with Sand Dollars or regular dollars when using the Island Pay mobile wallet. In doing so, the various parties will help integrate the Sand Dollar into the country’s financial ecosystem. Sand Dollars will eventually be available to tourists in addition to Bahamian citizens.
“By working with the Central Bank and Mastercard, we are able to issue a prepaid card unlike any other in the world,” said Island Pay Co-founder Richard Douglas. “We are now able to bring immediate, critical benefits to our customers at a time when they are looking to find new, innovative ways to pay.”
“This partnership is an example of how the private and public sector can rethink what’s possible, while delivering the strongest levels of consumer protection and regulatory compliance,” added Mastercard Digital Assent and Blockchain EVP Raj Dhamodharan. “We’re creating a lot more possibilities for governments, shoppers and merchants, allowing them to transact in an entirely new form of payment.”
The Sand Dollar is the world’s first central bank digital currency. The project, meanwhile, reflects Mastercard’s ongoing interest in blockchain and digital payment technologies.