Yet another Caribbean country is making strides in its pursuit of a central bank digital currency (CBDC). This time, it’s Jamaica, with the country’s central bank announcing recently that it had completed a CBDC pilot that it started eight months ago.
The Bank of Jamaica (BOJ) announced in March 2021 that it was testing a prototype CBDC. As CoinGeek reported at the time, the central bank partnered with eCurrency Mint, an Irish company that has been exploring CBDCs since 2011, on the project.
In May, the BOJ announced that it was commencing an 8-month long pilot of its digital Jamaican dollar. This was followed by an August announcement that the bank had minted $230 million of its CBDC, which it made available to the public.
This pilot ended on December 31, and according to the BOJ, the pilot’s success was dependent on “whether a central bank digital currency along with the attendant technology solution could be successfully implemented in Jamaica.”
The bank minted the digital Jamaican dollar during the pilot and issued it to wallet providers. On August 9, the BOJ issued $1 million worth of the CBDC to its Banking Department to be distributed to staff. Later that month, it gave $5 million worth of the CBDC to the National Commercial Bank (NCB), the first time it had issued it to deposit-taking institutions.
Upon receiving the CBDC, the NCB onboarded 57 customers—four merchants and 53 consumers. These customers conducted cash-in and cash-out, and person-to-person transactions among themselves to test the CBDC. They also completed transactions with small merchants such as local craft jewelers and fashion designers through “Market on the Lawn,” an NCB-sponsored event in December.
With the successful pilot, the BOJ announced that it’s moving ahead with a national rollout in Q1 2022. The NCB will continue spearheading the onboarding of new clients, but the BOJ is already working with two additional financial institutions, which will also be allowed to create wallets and onboard new clients soon.
Jamaica is aiming to become the next country in the Caribbean to deploy its CBDC. Already, the Bahamas has issued its Sand Dollar CBDC, which is now in full circulation in the country.
To learn more about central bank digital currencies and some of the design decisions that need to be considered when creating and launching it, read nChain’s CBDC playbook.
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