Ajay Banga, Mastercard CEO, Talks about Why the Firm Abandoned the Libra Association
The CEO of Mastercard, Ajay Banga, recently talked about why the firm left the Libra association in an interview with the Financial Times. Facebook also added Mastercard, Visa, Paypal, and Stripe, as members of the Libra association.
However, they abandoned the association in October last year without any appropriate explanation. There were, nevertheless, rumors that they feared running afoul of regulators.
Reasons Why Mastercard Left Libra Association
According to Banga, Libra lacks transparency, and compliance is also a significant reason. The Libra association’s key members were unwilling to participate in whatever was not compliant with the local law. These include anti-money laundering, know your customer and data management regulation.
Banga also noted that Libra’s Mastercard business model was not exact, and even how the association would make money. He also stated that Libra’s inconsistency with how it presents itself was an issue. Libra presents itself as a financial inclusion tool, and the utilization of wallet Calibra is unnecessary to Banga, even though he supports the global currency.
The Existence of Nationalized Payment
Recently, the concept of a nationalized payment network is reclaiming traction as Central Bank Digital Currency (CBDC). Banga mentioned some nations that tried CBDC, including France, Australia, Brazil, and Mexico.
Banga also noted that local networks are responsible for fragmenting the traction data required for analytic work. Therefore, tracking crime is becoming more complicated since terrorists abound without respect to borders.