In an announcement made by Prime Minister Andrew Holness, the Bank of Jamaica (BOJ) announced that the pilot for its central bank digital currency (CBDC) has been completed, and the bank plans to roll out the currency nationally in the first quarter of 2022. In a statement, Prime Minister Andrew Holness said the proposed plan will serve as a solid foundation for digital payments in Jamaica. It will help facilitate future plans such as financial inclusion, increased transaction speed, and a reduction in the costs of banking for citizens.
A pilot project that issued 230 million digital Jamaican dollars was successfully completed by the Bank of Jamaica in December 2021. As part of the project, $1 million of CBDC was issued to wallet providers as soon as it was announced and another $5 million CBDC was issued to a deposit taking institution, the National Commercial Bank two months later. A digital currency system was developed by the government to make formal financial benefits available to a large swathe of Jamaicans who are outside the financial system. This is where the virtual currency could replace 5% of the Jamaican dollars every year.
There are currently 57 customers who have signed up to use the new currency provided by the National Commercial Bank. In exchange for digital currency, customers can deposit funds in their digital wallet and access the funds at any time.
The Royal Bank of Jamaica joined the Bahamas and Eastern Caribbean Central Bank in creating the digital currency. It is expected that BOJ will give out two new wallet providers when the company begins its nationwide rollout sometime this quarter. A virtual simulation test has been conducted by new providers, who are going to be able to order CBDC from BOJ and distribute it to their customers with the help of virtual simulation software. In addition to increasing interoperability, bank officials will test transactions between recipients of different wallets.
Besides digitizing currency, there are big infrastructure projects the government intends to undertake, such as the Southern Coastal Highway Improvement Project, four-lane roads between Harbour View and Yallahs, new Houses of Parliament, etc.
