In a significant step forward in intranational cash transfers, the Central Bank of the Bahamas has announced the successful launch of the world's first Central Bank Digital Currency (CBDC), appropriately named the Sand Dollar. This country is a prime environment for such an innovative initiative with one of the highest per capita incomes in the Americas and a 90% penetration for mobile devices. The CBDC initiative consists of a digital version of the Bahamian dollar as well as an ecosystem of Authorized Financial Institutions (AFI), made up of money transmitter businesses, payment service providers and commercial banks, that provide services to retail customers, such as KYC/AML checks, wallet services and custodial services. AFIs can develop their own version of the Sand Dollar app, encouraging the use of digital wallets for payment transfers. The CBDC will work to accelerate financial inclusion through reduced delivery costs and transactional efficiency as well as increase resilience by creating a payment system independent of vulnerable electrical infrastructure.
Read the full article in Forbes here.
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