Regional currency Carib dollar (Carib$) now awaits testing with pilot programmes scheduled to get underway in Jamaica and Barbados between the third to last quarter of this year.

Speaking at a Caribbean Telecommunications Union (CTU) webinar on Wednesday, Dr Jan Schroder, chief system architect at CaribCoin, the firm leading the development of the regional currency in partnership with Barbados-based firm Abed Ventures Inc, said that with the currency now a minimum viable product (MVP), the developers in the last two years have been closely working with a number of regulators to ensure a successful and legally concise set-up and roll-out of the product.

“What we are setting up at the moment is the technical infrastructure and web-apps for users to securely buy, sell, store and transfer Carib$,” Schroder stated, noting that the infrastructure, which was already up and working since the last two months, now requires the support of government structures to ensure stability along with that of other private and public sector stakeholders.

For the pilot, Schroder made an appeal for some 10-15 businesses across Jamaica and Barbados engaged in cross-border trade to come on board. The currency being tested incrementally, he said, is to overtime see the addition of more users and other territories as traction builds around the currency and new phases established.

“We’re also looking for payment service providers interested in a new product for customers as well as supra-national and business networks interested in fostering regional development,” he stated.

Promising seamless payments and a stable value powered by fast, reliable and safe transactions, the complementary currency designed to deepen regional integration across countries is further touted a catalyst that will help to fast-track the region’s push behind a Caribbean Single Market Economy (CSME). It also aims to become a buffer for “a disconnected Caribbean”, one challenged by a limited supply of US dollar (on which it heavily depends), a weakening system of correspondent banks and low liquidity across many of its dominant national currencies. This, while seeking to offer financial inclusion and easier access to banking for micro, small and medium-sized enterprises (MSMEs).

“Carib$ provides liquidity to a region suffering from USD liquidity drenches. It works without intermediaries, enabling low-cost and nearly instant cross-border transactions and settlements between businesses. The currency is also easily accessible through trusted payment providers and is to be commonly accepted in all Caricom member states, allowing for exchanges against national currencies,” Schroder added, noting that Jamaica and Barbados were chosen as the first two countries for testing due to the equality in trade between both countries.

Carib$, a stablecoin or kind of cryptocurrency, is a digital payment system which currently allows for B2B transactions when conducting intra-regional trade, possessing the capability to work alongside various forms of national currencies as it helps to complement them.

CTU Secretary General Rodney Taylor said that with intra-Caricom trade now accounting for little over 10 per cent of Caricom’s total trade relative to other intra-regional trade levels, the roll-out of Carib$ will help regional traders to settle transactions much easier without having to engage in the regular back and forth and US dollar conversions.

He said that for countries such as Cuba, which for many years has been unable to participate in correspondent banking transactions, due to the more than six-decade-old embargo placed on that country by the US, the currency will create an opportunity for it to make payment to its regional counterparts.

“We want to see the success of this project as it doesn’t make sense that as a region trading in the same space, we are to be using other complex, heavily regulated onerous means of settling payments with our neighbours. We therefore believe that this technological solution can address at least one of the key problems of doing trade within the region, and we see the value in it driving social and economic transformation and the cost of doing business down,” Taylor said.

For his part CEO and director of the Caribbean Private Sector Organisation (CPSO) Dr Patrick Antoine, in lauding the currency and its upcoming pilot as a needed solution for the region, agreed that it will help to iron out existing issues concerning intra-regional trade. To this end, he called for other territories and bodies such as Trinidad and the Organisation of Eastern Caribbean States (OECS) to be added to the pilot.

“One of the problems with the payment solutions that we have tried in the past, is that we have tried to take a macro approach to what really has to be a private sector driven and involved mechanism to solving the payment problems in the region,” he stated, indicating that, “it’s not going to happen if left solely up to central banks.”