JAMAICANS will now have another means to make certain payments at Tax Administration Jamaica (TAJ) as Jam-Dex, the country’s central bank digital currency (CBDC), can now be used to pay fitness fees, property taxes and traffic tickets.

This was revealed in the Bank of Jamaica (BOJ) 2024 annual report, which address several initiatives to improve the acceptance of Jam-Dex (Jamaica Digital Exchange). A check by the Jamaica Observer at the St Andrew collectorate on Constant Spring Road on Tuesday revealed booths outside and inside decorated with Jam-Dex promotional material. Another check of the TAJ payment portal revealed an option to pay with Jam-Dex to settle transactions.

“During 2024, the bank remained resolute in ensuring safe and reliable financial market infrastructures (FMIs). Notable achievements during the year included merchant-strengthening initiatives through an internal Jam-Dex point-of-sale (POS) (inline) pilot as well as preparatory work for a Jam-Dex (online) pilot with a government entity. Additionally, the bank boosted its system resilience with the installation of the Jam-Dex Disaster Recovery site,” the BOJ annual report stated.

The Government is currently pursuing initiatives to improve tax collection and ease of doing business with TAJ. One of the recent announcements by Finance Minister Fayval Williams is that more tax offices would be open on weekends, with Prime Minister Dr Andrew Holness also announcing other initiatives under the Streamlining Processes for Efficiency and Economic Development (SPEED) initiative to reduce foot traffic in the tax offices. This is being conjoined with the introduction of new revenue centres in certain areas to make it easier for people to do business with the Government.

Jam-Dex is legal tender and can be exchanged one-for-one with Jamaican dollars. It was officially minted in August 2021 and became legal tender in June 2022. The Future of Business, or TFOB (2021) Limited, a subsidiary of NCB Financial Group Limited (NCBFG), became the first entity to issue a digital wallet in the form of Lynk. JN Bank Limited was added as a digital wallet provider with JN Pay Wallet in December 2022, while Sagicor Bank Jamaica Limited was added as a digital wallet provider in August 2023.

However, Jam-Dex has been struggling to garner wider acceptance in the Jamaican population due to the limited number of wallet providers and the inability for it to be readily used at point-of-sale (POS) machines at merchants. This is reflected by the fact that the amount of Jam-Dex minted has remained at $276 million since 2022 relative to the physical currency (banknotes and coins) in circulation at $286.1 billion at the end of 2024.

A total of $46 million Jam-Dex was available at the end of 2022. That has now moved to $258.5 million in circulation at the end of 2024.

Some $144.8 million Jam-Dex was in the hands of the public, with the other $113.7 million held in the digital vaults of wallet providers. There was also a seven per cent increase in the number of Jam-Dex-registered wallet users to 282,274 at the end of 2024.

The BOJ noted that Lynk was the only wallet provider at the end of 2024 offering Jam-Dex to the public. It said that three other commercial banks were at different stages of launching their digital wallets.

A pamphlet made available at the Constant Spring tax office states that the public can download the JN Pay Wallet app in the Google Play Store. Sagicor Bank’s online banking platform currently has My Digital Wallet accounts being shown on a client’s account overview.

With respect to the acceptance of Jam-Dex on POS devices, the central bank noted that progress was made during 2024 on activities to allow the CBDC to be accepted on POS machines, which included a pilot. However, the current limit of three digital wallet providers was mentioned as a constraint. Last year was the third of BOJ’s five-year plan for the national roll-out of Jam-Dex.

BOJ has previously mentioned working with a technology provider to allow for a dynamic QR code to be used on at least 10,000 POS machines to accept Jam-Dex.

BOJ Deputy Governor Natalie Haynes mentioned at the bank’s August 2024 quarterly briefing that this dynamic QR code worked in the bank’s regulatory sandbox. However, she noted, “Wallet providers, the existing ones, are not yet fully ready with their technological changes required to implement that fully at the point of sale for the merchants. We’re working on that.”

The introduction of Jam-Dex is one of several initiatives being pushed for greater financial inclusion in Jamaica. While there has been an increase in the number of people entering the financial system following the removal of the reference requirement in 2023, there remain relative hurdles for Jamaicans with the traditional banking system. One of the main points touted about Jam-Dex is that it can be transacted anytime between wallet users and is not constrained to the normal business days of the week. Jam-Dex also carries no cost for customers who use their mobile phone to conduct transactions, and is secured by the BOJ.

BOJ further added that there was meaningful progress regarding the Electronic Know-Your-Customer (eKYC) and Account Portability projects during 2024. These projects are meant to increase competition in the banking system by allowing people to move their accounts to other banks with their existing KYC information.

The first 100,000 customers to open Jam-Dex wallets on Lynk were given $2,500 Jam-Dex each in 2023, as part of an incentivisation programme by former Finance Minister Dr Nigel Clarke. Jam-Dex was also used in December 2022 for the Government’s Employment Generation (Christmas Work) Programme under which $600,000 in Jam-Dex was paid to people across St Andrew North Western and St Andrew South Eastern.

In March, Finance Minister Fayval Williams discussed Jam-Dex during Parliament’s Standing Finance Committee. She said, “Obviously, it will take some resources to onboard persons, to onboard financial institutions, and to onboard businesses. The last time I heard the governor speak on this, onboarding the businesses was going a little bit slower than anticipated. But I know that they have identified some of the issues and they have been working and will continue to work on ensuring that there is smooth onboarding of businesses — because that’s a key component of being able to see widespread adoption of the Jam-Dex.”