The Central Bank of the Bahamas recently announced key collaborators for building a digital fiat currency system in the country. The project named “Sand Dollar” seeks to provide access to digital payment capabilities while simultaneously reducing cash transactions and cutting delivery costs.
The Central Bank of the Bahamas announced its plans to release its own state-backed digital currency in June 2018. At that time Bahamas’ deputy prime minister and minister of finance claimed that a digital Bahamian currency will be of extreme importance. He said,
“A digital Bahamian currency is especially important for the many family islands as they have seen many commercial banks downsize and pull out of their communities, leaving them without banking services. As an island nation, where transportation can be an inconvenience for many, especially the elderly, and costly, we must offer financial services digitally and securely.”
The Bahamas bank will also tie up with NZIA.io, a transaction provider to bring forward the expertise of IBM and Zynesis, a Singapore-based software development firm which offers blockchain solutions.
The bank is soon stated to start on negotiations with NZIA for discussing the final terms and scope of collaboration. As per the announcement, the upcoming digital fiat currency will comply with the local regulations. This also includes the draft regulatory Central Bank of the Bahamas Bill, 2019.
The regulatory framework will include policies against money laundering and terrorist financing. It will also include parameters to improvise the digital currency’s st“A digital Bahamian currency is especially important for the many family islands as they have seen many commercial banks downsize and pull out of their communities, leaving them without banking services. As an island nation, where transportation can be an inconvenience for many, especially the elderly, and costly, we must offer financial services digitally and securely.”atus as compared to the traditionally adopted banking system.
The Deputy Prime Minister also said that Bahama is will soon issue blockchain-based education certificates for graduates of the National Training Agency. Additionally, it will find ways in which blockchain can be applied for business licences, passports, and national insurance. He said,
“Using technology and single points of contact we're able to eliminate a lot of the human element that facilitates corruption, and so when we talk about applying for government services, if we have a single portal for entry and all of the processing being done behind the scenes, either through electronic data interchange or through human facilitation we can eliminate that point where, we Bahamians call it, you have to tip somebody in order to get service.”
The Central Bank was established on 1 June 1974 by The Central Bank of The Bahamas Act. The bank is responsible for executing monetary policies and supervising financial sector of the Bahamas.