Bank of Jamaica (BOJ) is set to become the third central bank in the Caribbean region to issue digital currency after this week selecting a technical vendor, eCurrency Mint Incorporated.
The Central Bank of Bahamas last year launched its Sand Dollar digital currency last October. Then, in November 2020, the Eastern Caribbean Central Bank issued DCash, a securely minted digital version of the Eastern Caribbean dollar, as part of a pilot.
Consumers can access the DCash App on their smart devices and can obtain the fiat currency from their commercial banks, credit unions, or other authorised financial institutions.
In early March 2021, the BOJ said that after exploring the viability of a central bank digital currency (CBDC) for some time, it would explore launching a currency. They noted that the decision was originally taken in May 2020.
On March 23, 2021, the Bank of Jamaica announced that after an extensive procurement process, the technology provider chosen for the proposed pilot of its digital currency will be eCurrency Mint. The central bank also said the national CBDC will roll out in early 2022.
The pilot project in the Bank’s Fintech Regulatory Sandbox is set for May to end December 2021.
According to the BOJ, eCurrency Mint is a global thought leader and pioneer of the hardware, software, and cryptographic security protocol technology to enable central banks to securely issue, distribute and supervise CBDC, a digital currency that will operate alongside notes and coins as digital legal tender.
CBDC is a digital form of central bank-issued currency and is, therefore, legal tender. The BOJ said it is not to be confused with cryptocurrency, which is privately issued and not backed by a central authority. CBDC is fully backed by the Central Bank, the sole issuer.
The legislative review to amend the Bank of Jamaica Act to concretise BOJ as the sole issuer of CBDC is well underway, the BOJ outlined.
It was noted that CBDC will not be a cost to consumers and will be a full complement to banknotes and coins issued by BOJ. Both CBDC and physical notes and coins will co-exist in the payment space.