Ashok Venkateshwaran, the Asia-Pacific lead of Mastercard’s blockchain and digital assets, said that adopting central bank digital currencies is difficult. The company also indicated that consumers still feel comfortable with “today’s type of money.” This includes coins and paper money. Hence, Mastercard feels that having a CBDC does not seem justified.
Venkateshwaran is of the opinion that the widespread use of central bank digital currencies is not justified at the moment. Hence, its broad adoption seems difficult for Mastercard. Venkateshwaran said that if you have CBDCs in your wallet, you must be able to spend it anywhere you want. However, this is not the case, as is possible with cash or paper money. He made this statement while on Wednesday at the Singapore FinTech Festival.
The Central Bank’s retail CBDC is a digital form of fiat currency that individuals and businesses can use for everyday transactions. However, it is different from wholesale CBDC, which only central banks, commercial banks, and financial institutions can use. Wholesale CBDCs are only applicable for large-value interbank transactions.
Venkateshwaran also said – “But [building infrastructure to facilitate that] takes a lot of time and effort on a part of the country to do that. But a lot of the central banks nowadays have gotten very innovative because they are working very closely with private companies like ours, to create that ecosystem.”
The IMF (International Monetary Fund) stated that CBDCs are not only safe but are also low-cost alternatives to cash. They added that more than 60% of countries of the world are exploring CBDCs, out of which 11 countries have adopted them.