On Tuesday, Jamaica’s Minister of Finance Nigel Clarke announced that the first 100,000 Jamaicans who sign up for Jamaica’s Central Bank Digital Currency (CBDC), known as JAM-DEX, will receive a J$2,500 deposit ($16) deposit. The CBDC goes into production on April 1.
This promotion aims to encourage Jamaicans to adopt JAM-DEX for everyday transactions. The digital currency implementation forms part of the government’s digital transformation of Jamaica’s economy. This follows the five-month successful pilot program the Bank of Jamaica (BOJ) started in August 2021. The solution was developed by Irish startup eCurrency Mint and operates through its Fintech Regulatory Sandbox. The BOJ chose to forgo the use of blockchain.
According to the Bank of Jamaica (COMBAT), the JAM-DEX is based on a hybrid-model (adopting elements of both retail and wholesale CBDCs) and is intended solely for domestic use. Therefore, the BOJ will issue the CBDC to both commercial banks and other deposit-taking institutions (DTIs) licensed or authorized by BOJ to distribute to the retail market. As legal tender, the CBDC can be exchanged on a 1-to-1 basis with physical cash.
Meanwhile, the Minister noted that a digital currency wallet would automatically be available to anyone with a bank account. “If you don’t have a bank account, all that is required to set up a JAM-DEX-enabled wallet are simplified Know Your Customer information: name, address, date of birth, tax registration number (TRN), and a valid government-issued photo ID such as a driver’s license, passport, or voter identification card,” said the Minister.
Given one of the stated purposes of a CBDC is financial inclusion, not requiring a bank account is critical. A secondary objective is to enable digital payments.