Jamaica has pledged to invest millions of dollars in upgrading the country’s Point-of-Sale (PoS) equipment to handle JAM-DEX, 18 months after the central bank digital currency‘s (CBDC) launch.
JAM-DEX launched in July 2022 as the Caribbean island nation’s push to promote financial inclusion. However, the CBDC’s adoption has been lackluster and has failed to meet its targets despite efforts such as a CBDC-powered digital marketplace.
One of the challenges has been that the country’s PoS machines are unable to handle CBDC transactions, and the Bank of Jamaica (BOJ) has pledged to jump in and spend millions of dollars on their upgrade.
The central bank will partner with a tech solutions provider to upgrade at least 20% of the existing 50,000 PoS machines to support CBDC QR codes.
“We are willing to form a joint venture to finance that along with the deposit-taking institutions to replace the old PoS machines so that they can take the QR code. I think it will be successful, eventually,” BOJ Governor Richard Byles said.
The BOJ noted that the central bank intends to pause all marketing activities for the CBDC until it resolves the PoS issue.
Since its launch, JAM-DEX has been available to Jamaicans only through one digital wallet, Lynk. The wallet is offered by the National Commercial Bank (NCB), which, together with the Bank of Nova Scotia, controls two-thirds of the market. Two other wallets were said to be in the pipeline, but they have yet to launch.
Lynk users can instantly send their JAM-DEX to other users and withdraw their funds on any NCB ATM.
JAM-DEX is one of only four functional CBDCs globally, along with Nigeria’s eNaira,
Bahamian Sand Dollar, and the Eastern Caribbean Central Bank’s regional DCash. Incidentally, they have all struggled with adoption, with each faced with a unique set of challenges.
In Jamaica, only 260,000 people have opened a Lynk CBDC wallet in a country with nearly three million people. In its first six months, the digital currency recorded $357 million in transaction volume. For context, the country recorded around $2.5 trillion in digital transactions in that same period.
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