{"id":168372,"date":"2023-05-12T06:00:00","date_gmt":"2023-05-12T11:00:00","guid":{"rendered":"https:\/\/www.ict-pulse.com\/?p=168372"},"modified":"2023-05-11T18:36:40","modified_gmt":"2023-05-11T23:36:40","slug":"roadblocks-to-a-successful-digital-marketplace-for-jam-dex-5-critical-issues-to-tackle","status":"publish","type":"post","link":"https:\/\/ict-pulse.com\/2023\/05\/roadblocks-to-a-successful-digital-marketplace-for-jam-dex-5-critical-issues-to-tackle\/","title":{"rendered":"Roadblocks to a successful digital marketplace for JAM-DEX: 5 critical issues to tackle"},"content":{"rendered":"\n
As early as July 2023, Jamaica should have a digital marketplace, which it is hoped will drive increased e-commerce and the use of digital payments, especially JAM-DEX, the country\u2019s Central Bank Digital Currency. However, cognisant of the challenges JAM-DEX has been experiencing, the immediate success of the digital marketplace is not assured. We outline five issues that must be addressed before the digital marketplace for JAM-DEX is likely to be a success.<\/em><\/p>\n\n\n\n <\/p>\n\n\n\n At the recently concluded Expo Jamaica 2023, a tradeshow and marketplace for Jamaican manufacturers and exporters, and during a panel discussion on e-commerce, the Minister of Industry, Investment and Commerce, Senator Aubyn Hill, announced that work was underway to develop the digital marketplace. This marketplace, which should be operational by the beginning of summer 2023<\/a>, is supposed to be a centralised platform where merchants and digital wallet users can interact with each other using JAM-DEX, Jamaica\u2019s Central Bank Digital Currency (CBDC).<\/p>\n\n\n\n In Jamaica, Lynk is the only digital wallet authorised to transact in JAM-DEX, as was discussed in a recent podcast episode<\/a> with John Matthew Sinclair, Lynk\u2019s Chief Product Officer. However, additional wallets are expected to come on stream soon, potentially increasing commercial activity in the digital space, whilst also increasing the value and impact of Jamaica\u2019s digital economy.<\/p>\n\n\n\n However, in listening to the panel discussion, which included representatives from Lynk and the Bank of Jamaica, in addition to the Minister, there seemed to be some unspoken challenges that will need to be addressed to have a successful digital marketplace. Suffice it to say, none of the issues outlined below were raised during the discussion<\/p>\n\n\n\n <\/p>\n\n\n\n Although one could not help but admire the Minister’s enthusiasm for JAM-DEX and the digital marketplace, a glaring omission exists. The Government of Jamaica does not transact in JAM-DEX. In other words, when interacting with the Government, citizens cannot pay for goods and services in JAM-DEX. They cannot pay their taxes, register a business, or renew their driver\u2019s licence using JAM-DEX. Even if an individual had JAM-DEX, they would need to use cash or credit cards when doing business with the Government.<\/p>\n\n\n\n Such a posture by the Government of Jamaica could inherently be leading to the reluctance of businesses and consumers to adopt JAM-DEX, though the Government and the Bank of Jamaica are enthusiastically encouraging them to do so. Also, governments tend to be the largest employers and procurers of goods and services in their respective jurisdictions and are entities with which every resident interacts. They thus have the power to change the behaviour of their citizens through the policies and practices they implement.<\/p>\n\n\n\n If the Government of Jamaica were to adopt JAM-DEX for payment, and even encourage payments to be made in that currency, it could result in a marked increase in public confidence in this new dispensation. Essentially, the stamp of government approval has to move beyond encouraging everyone else to use JAM-DEX, to the Government also itself using it.<\/p>\n\n\n\n <\/p>\n\n\n\n This issue was highlighted in a recent article<\/a> in which WiPay Jamaica noted that the current framework was encouraging silos by mobile wallet and payment systems providers. Essentially, the customers using a specific mobile wallet would only be able to interact and transact with other holders of the same wallet. Cross-provider transactions are not allowed, which means that if an individual had a WiPay wallet, for example, and wanted to send money to someone who uses a Lynk wallet, it cannot be seamlessly and easily done. The money from the WiPay wallet would most likely need to be transferred into a bank account, and thereafter transfer to their Lynk wallet in order to send funds to another Lynk wallet holder.<\/p>\n\n\n\n This emerging fragmentation of the mobile wallet and payment systems space is likely to hinder the establishment and growth of the digital marketplace. Consumers would not be able to only focus on what they want to purchase, but will also have to consider whether they are using the same mobile wallet or payment system as the vendor. On the flip side, vendors would most likely need to juggle multiple mobile wallets and payment systems, which would be an administrative headache and consequently, could be a deterrent to transacting with digital money altogether.<\/p>\n\n\n\n <\/p>\n\n\n\n1. Government not putting their money where their mouth is<\/h2>\n\n\n\n
2. \u00a0The interoperability of wallets is absent<\/h2>\n\n\n\n
3. The still overwhelming emphasis on cash<\/h2>\n\n\n\n