Feb 18, 2021

Mastercard and Island Pay launch first digital currency card

Mastercard
IslandPay
CentralBankoftheBahamas
Digital
William Girling
3 min
Mastercard and Island Pay launch first digital currency card
Finance giant Mastercard has teamed up with Island Pay to deliver a world first: a digital currency-linked payment card backed by a central bank...

Held together by Central Bank of The Bahamas, the collaboration will enable people to use an official digital currency called ‘The Bahamas Sand Dollar’ for purchases via a prepaid card.

Transactions carried out with the card are automatically converted from digital to fiat currency and will be legal tender for goods and services on the islands (of which there are 700), as well as around the world.

It is hoped that the Sand Dollar will create a more financially inclusive economy, promote more diverse purchasing methods, and facilitate government disbursements. The same value and protections will apply as the Bahamas’ traditional currency.

Modernising payments in the Bahamas

The Sand Dollar was originally trialled in 2019 and went on to become the first digital incarnation of a national currency in circulation late last year.

Mastercard’s virtual testing environment allowed developers to chart the issuance, distribution and exchange of the Sand Dollar in a simulated environment prior to its real rollout.

Island Pay’s role was to combine Mastercard’s technology and operational breadth with its own platform, which has been revolutionising payment solutions in the Caribbean through lower costs and higher quality service since it was founded in 2018.

“By working closely with the Central Bank of The Bahamas and Mastercard, we are able to issue a prepaid card unlike any other in the world. 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,” said Richard Douglas, Co-Founder.

“The Bahamas is leading innovation in CBDCs (central bank digital currencies), and we’re thrilled to be able to play an important role in helping to democratise access to currency, especially in areas that are currently underserved.”

The shape of digital payments to come

2021 has already seen Mastercard and other industry leaders like Visa partner with innovative fintechs to chart new paths in digital payments, including Paymentology, CleverCards, and Joompay.

Although digital versions of fiat currency are beginning to emerge globally, the pioneering work taking place in the Bahamas, which unites central banking and payments so holistically could give an indication of finance’s future everywhere.

“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,” stated John Rolle, Governor.

Furthermore, Raj Dhamodharan, Executive VP at Mastercard, praised the project’s results and intimated that this represented just the tip of iceberg:

“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. We’re creating a lot more possibilities for governments, shoppers and merchants, allowing them to transact in an entirely new form of payment."

Image credit: Island Pay

Share article

Jun 22, 2021

Payment startup Mollie raises US$800m at a $6.5bn valuation

Fintech
Mollie
Valuation
Payments
3 min
A new funding round values Mollie at US$6.5bn making Mollie the third most valuable privately-held European fintech behind Klarna and Checkout.com

Mollie, one of the fastest-growing payment processors within Europe, today announced it has raised US$800m in a Series C funding round, now valuing the company at $6.5bn. The valuation, based on Dealroom data, makes Mollie the third most valuable privately-held European fintech behind Klarna and Checkout.com.

Blackstone Growth (BXG), Blackstone’s growth equity investing business, led the investment and included participation from EQT Growth, General Atlantic, HMI Capital and Alkeon Capital. TCV who led the Series B investment in September 2020 also participated in the funding round. 

According to the company, the funding will fuel Mollie’s international expansion, team scaling, and continued investment in product and engineering.

“There’s something very special about Mollie. In the three months since I joined the team we’ve achieved so much: making preparations for a full launch in the UK, driving 600% growth in Germany and hiring an impressive set of team members and executives,” said Shane Happach, CEO, Mollie. “Over the past months, Mollie has been receiving a remarkable amount of interest from some of the world’s foremost fintech investors. In bringing on BXG, we believe we have an investor who can help Mollie in our next phase of growth. The involvement of our new group of investors demonstrates confidence in Mollie’s growth, strategy and product set.”

The Amsterdam-based business was launched in 2004, and is one of the largest PSPs in Europe. Today, it serves more than 120,000 monthly active merchants of all sizes across the continent. During 2020, Mollie processed more than 10 billion Euros in transactions and is on track to handle more than 20 billion Euros during 2021. 

“Mollie is one of Europe’s most exciting high-growth businesses and is at the forefront of enabling next-generation payments for online SMEs across Europe. We are excited to partner with Mollie’s fantastic team and look forward to leveraging Blackstone’s capital, expertise and global network to unlock the company’s next phase of growth,” said Paul Morrissey, who leads European investing for Blackstone Growth. “This investment underlines Blackstone’s confidence in Europe as a place for high-growth companies to thrive.”

Competition 

In Europe, FinTech app usage grew by 72% directly after the pandemic outbreak, while the top seven digital banks in the US grew their cumulative user base by 39% throughout the year. Competition in payments has grown over the past few years with fintech players like Stripe, Square and Netherlands-based Adyen all competing for a bigger share of the market.

Unlike its American rivals, Mollie says it mainly focuses on transactions with small businesses in Europe. Shane Happach, CEO of Mollie said: “A lot of the bigger players in online payments come out of the US, like PayPal,”. Adding that even Visa and Mastercard are US companies.

“A lot of investors don’t have a bet on Europe,” Happach said. “Mollie’s one of those unique assets that offers exposure.

Share article