The goal is to encourage mass adoption of the country’s new central bank digital currency (CBDC). The first 100,000 Jamaican individuals who use the CBDC, known as Jam-Dex, would get a $16 payment for free.
The news was originally revealed on Thursday by Jamaican Prime Minister Andrew Holness in his Facebook post. Some Facebook users congratulated Holness for welcoming new digital technology.
On the other hand, some users showed fear about the Jamaican government’s ambitions. They accused Holness of attempting to sweet talk individuals into the federal banking system.
Helping poorer side of the population
As per Jamaica Observer, over 17% of Jamaicans do not have access to banking services. People on social media speculate about the administration’s motivations.
Although, the Observer points out that not being able to access banking services is bad for poorer Jamaicans. It is both costly and time-consuming.
There are a lot of reasons behind the new system. This new payment inducement is intended for low and middle-income households. They want to encourage them to participate in the national banking system.
When the Bank of Jamaica concluded an eight-month trial program for Jam-Dex on December 31 of last year, they posted an announcement. A countrywide deployment might begin as early as April. According to the Bank of Jamaica, all Jamaicans with pre-existing bank accounts will be eligible for Jam-Dex digital wallets immediately.
Jamaican Finance Minister Nigel Clarke stated that for Jam-Dex to be effective, it must be widely adopted by residents and companies.
Jam-Dex and its backlash
The new digital currency will be known as Jamaica Digital Exchange or Jam-Dex for short. It will have its own logo and the catchphrase “No money, no problem.” The Bank of Jamaica anticipates launching the currency as soon as possible, potentially next month.
The name Jam-Dex was received with a lot of backlashes for multiple reasons. People complained that technically and aesthetically it was not appealing.
Jam-Dex is referring to the fact that currencies are exchanged. Also, to the fact that it is both digital and Jamaican currency. However, the jargon has caused a lot of misunderstanding.
Because Jam-Dex is essentially digital money, users on Twitter were quick to address the actual error in the currency’s name.
Jam-Dex is only digital money, but DEX in crypto terminology refers to a decentralized exchange. A decentralized exchange is a site where cryptocurrencies are traded and sold.
Interest in creating CBDC is increasing
China was one of the first nations to declare the construction of its CBDC, the digital yuan. In terms of CBDC approval and propagation, Caribbean countries have quickly surged to the top. In eight different nations, the Eastern Caribbean Central Bank (ECCB) has established DCash (CBDC).
Many more countries continue to test CBDC adoption. A few days ago, the Philippines declared its intention to publish Project CBDCPh. Iran, Kenya, and the European Union have been among the latest entities to pursue CBDC implementation.
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