With all due respect to Betteridge’s Law, which states that any opinion piece headline that is a yes/no question will invariably be answered no, the answer is… no.
MasterCard Send is a new service that will allow card holders to send money, domestically and internationally, instantly for low cost. Currently operational in the US, the service will allow both banked and unbanked individuals to get payments through deposits to their credit cards, bank accounts, or to payment agents.
This service would seem to be a direct challenge to the rise of virtual currencies like Bitcoin and may in fact be inspired by them. Here are some ways the service will fall short:
- The service is mostly being marketed to businesses, possibly as a roll-out strategy, but also possibly showing a fear of making the service generally accessible.
- Though money might be collected from authorized money exchanges if the recipient doesn’t have a bank, it’s unclear if the person sending the money will need to be banked.
- There is no word about the fees involved. It is very possible that it will be economical for large institutions to send large amounts of money, but be completely impractical for smaller users.
- This is a centralized system, completely controlled by MasterCard. Thus, every transaction will be monitored and reported. No sending money to anyone or any organization that MasterCard or your local government don’t like.
- Although there will be some facility in remitting money, this is not a currency in-and-of itself and will provide no hedge against inflation, devaluation, or financial collapse: things Bitcoin was designed for.
Interestingly, Barb King, a group head in the MasterCard Payment Systems Integrity Group, described said of the service, “consumers are much more comfortable giving their personal details to their financial institution than they are to many other types of entities.” This is a very telling quote that seems to miss the point of Bitcoin altogether. If you don’t want to, there is no need to send personal information at all to the recipient. A case in point is that one of the ads in the sidebar of this article is run by A-Ads, a service that needs only a Bitcoin address to register and makes payment to that address.
Even more, it’s funny that an industry leader would say that people are comfortable giving them personal information. They do because they recognize the type of service it is, but they would definitely prefer to not have all their purchases tracked.
The creation of MasterCard Send make sit clear that the industry is paying attention, but at the end of the day, it’s going to be a day late and a dollar short.