- The bank of Jamaica has legalized the Jam-Dex central bank digital currency
- Jamaica is now the first country to accept the central bank digital currency as a legal tender.
- JMMB reported that it is in an exploratory phase with the central bank digital currency launching
The Bank of Jamaica has accepted the Jam-Dex central bank digital currency (CBDC) as a legal tender within its jurisdiction. In attempts to acquire a better alternative for the economy that is mainly run by fiat currency, Jamaica is now the first country to accept a CBDC as legal tender.
The Jamaica Digital Exchange, Jam-Dex, has undergone a series of pilot tests since last August. Although initial plans was to roll out the CBDC in Q1, there had been some delays, leading to the late launch.
The CBDC was legalized after the Jamaica Senate agreed to its issuance by the National Bank through an amendment. The legislation recognized the Jam-Dex, virtual tokens and physical notes and coins all as legal tenders.
Jam-Dex will offer new payment solutions
According to Richard Byles, Governor of the Central Bank of Jamaica, after the launching of the Jamaica Digital Exchange, it will officially be leveraged for domestic use.
The CBDC technology provider ecurrency CEO reported that “Legislators in Jamaica have all now unanimously moved a digital dollar forward in Jamaica. You can use this to settle any debt in Jamaica. It is the medium of exchange. It is the medium of account.”
The CEO, Jonathan Dharmapalan, encouraged central banks from other countries to appreciate how their currencies can be leveraged in the form of digital money.
He opined that “Because it’s digital, you don’t have to be in the same place at the same time to execute a transaction…It’s a really, really powerful tool.”
Pushing Jam-Dex into mainstream
The JMMB is planning to launch some new products in relation to encouraging the adoption of Jam-Dex. Some of these products include point-of-sale, e-commerce and more solutions for new payments.
The JMMB reported that it is in an exploratory phase with the central bank digital currency launching.
General Manager of JMMB, Gifford Rankine reported that the group was in the quest to acquire the right technology partner to collaborate with.
The National Commercial Bank is also pushing the Jam-Dex via the Lynx wallet.
The state of CBDC global adoption
Jamaica joins the list of countries that have their attention on the CBDC technology. Currently, approximately 105 countries are researching or developing a CBD.
Countries such as Haiti and Brazil are among some of the nations that have focused on the expansion or launching of the CBDCs. In 2020, Bahamas central bank digital currency, the Sand dollar, became the first CBDC in the world.
Nigeria launched its central bank digital currency, the eNaira in October 2021. The eNaira was expected to increase financial inclusion and facilitate remittances.
The Bank for Internal Settlements in its May report stated that “Providing a cash-like digital means of payment, in light of reduced cash usage and an increase in private digital payment services, is the most common consideration,” the report said. “Other significant considerations include strengthening competition among payments service providers (PSPs), increasing efficiency and reducing the costs of financial services.”
