Robinson brands JAM-DEX a failure

Opposition Spokesman on Finance Julian Robinson has described Jamaica's Central Bank Digital Currency(CBDC) - known as JAM-DEX - as a failure.

The digital currency was issued by the central bank nearly four years ago, to, among other things, give Jamaicans a safe, digital alternative to physical cash.

But, Mr Robinson, speaking in the House of Representatives on Tuesday, was scathing in his assessment of its uptake and use.

He referenced JAM-DEX during his contribution to the Digital Services (Amendment) Act debate.

“ JAM-DEX provides the clearest possible demonstration of what happens when digital money is issued without an open network to circulate it,” he declared, pointing out that “circulation stands at below 0.1 of 1% of currency in issue.”

Elaborating, he told the House that so far “there have been no redemptions, only two wallet providers operate, and there is no merchant acceptance network. Banks treat JAM-DEX as a zero fee substitute for their own deposits and have very little commercial reason to promote it.”

“The failure is not technological; it is a design error in the incentive structure,” he asserted, adding that “wallet distribution and merchant acceptance were placed on individual providers rather than built as a shared public infrastructure.”

Mr Robinson is urging that a dual track strategy be pursued to achieve the desired outcome.

 “The BOJ should transition from CBDC issuer to national payment infrastructure operator, building systems similar to what exists in Brazil and India. The UPI/PIX system with open rails on which JAM-DEX can operate licensed stable coins and a regulated virtual assets that can all circulate.”

He said the funding model should follow the international benchmarks, “free for individuals with a merchant discount of somewhere between 0.4 to 0.5% of 1%, and a portion of that revenue dedicated to merchant onboarding in underserved communities.”