PORT OF SPAIN, Trinidad– Barbados, and Jamaica will, in the next six months set to become the first Caribbean countries to access a new Pan-Caribbean digital payment settlement system called Carib Dollar (Carib$).
The disclosure regarding Carib$, a stable coin, which is the creation of partners Abed Ventures Inc., out of Barbados, and German entrepreneur Dr. Jan Schröder, was made during the Caribbean Telecommunications Union’s (CTU) webinar on “Demystifying Cryptocurrency and Digital Cash in the Caribbean.”
During the virtual conference last Friday, which was moderated by the Barbados-based technology and business professional Amit Tekchandani, Carib Coin Inc’s chief system architect, Schröder, indicated that a stable coin is a kind of cryptocurrency, the value of which is pegged against legal tender like the US dollar and other commodities such as gold or petroleum.
He said Carib$ “will be backed by Caribbean assets and will enable the settlement of accounts between traders or vendors doing business in different Caribbean territories (cross-border) in the legal tender of each party’s country of origin without the use intermediaries such as banks, using an online platform to transfer the electronic funds.”
Carib$ will also provide a solution for the many unbanked small traders and small, medium, and micro enterprises (SMEs) to make payments seamlessly, instantly, safely, and privately.
“Within an appropriate regulatory framework, digital currencies can potentially deepen the Caribbean Community’s Single Market and Economy (CSME) thrust,” said CTU Secretary-General Rodney Taylor.
Economist, Marla Dhahran, told the webinar that the region needs innovative solutions to meet the condition of the poor and those operating in the informal economy, such as hucksters and other small traders.
“With no robust and efficient trade settlement system for such business categories, digital currency provides a viable alternative. Digital currencies also provide additional options for the poor in the region who depend on remittances to survive. The cost of transfer using traditional means varies between three to 25 percent of the value of the funds being transferred,” she added.
Chair of the FinTech Group at the St. Kitts-based Eastern Caribbean Central Bank (ECCB), Sharmyn Powell, using the experience of the Organization of Eastern Caribbean States (OECS) with digital currency, noted that the ECCB sought to address some recurring issues in its financial system with its new digital currency, cash.
They spoke of the high cost of current payment methods and banking services, the inadequacy of banking services in addressing the needs of the unbanked customers, and the inefficiencies in the financial management systems of unbanked small traders, which could slow the pace of commerce.”
The advisor, Digital Trade Policy at Trade Oceans and Natural Resources at the Commonwealth Secretariat, Vashti Maharaj, who added another perspective, said, “cultural barriers, such as resistance to change and limitations with financial literacy or digital skills, will require emphasis to be placed on public awareness, education, and capacity building to promote the ready adoption of the new technologies.”
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