The proposed introduction of the central bank digital currency (CBDC) could help to reduce the targeting of retail and wholesale businesses by criminal gangs who go after large cash receipts, according to Peter Bunting, leader of opposition business in the Senate.
The Upper House on Friday approved the Bank of Jamaica (Amendment) Act, 2022 which, will facilitate the issuance of the CBDC by the central bank.
“To the extent that we can move a lot of that (cash) into the digital currency realm, into digital wallets or any other type of electronic-based transaction rather than cash, I think that will be a positive in reducing the risk of harm or exposure to violence by legitimate business operators,” he said.
While supporting the proposed statute, Bunting urged the Government to proceed with caution and care “so that we don’t end up inadvertently making it easier for criminals and their facilitators to access the illicit proceeds of crime”.
He reiterated comments made by National Security Minister Dr Horace Chang in his Sectoral Debate presentation this week that $1 billion in illicit money has been flowing into the economy annually.
“We have, therefore, to be very careful that nothing in this bill facilitates the ease or expansion of those criminal enterprises in evading the scrutiny of law enforcement agencies,” Bunting urged his colleague legislators.
He said that the central bank should carry out a robust public-education exercise to sensitise the population about the safety and the benefits of the digital currency as there was still some scepticism about the use of mobile wallets.
In piloting the bill, Leader of Government Business Kamina Johnson Smith said that the CBDC will lower the cost associated with providing a national means of payment and provide an alternative to the issuance of banknotes.
She said that the CBDC should not be confused with cryptocurrency.
Johnson Smith reported that a pilot of the digital currency was rolled out between August and December.
She said that the national roll-out of the CBDC is scheduled for this quarter of the financial year.
The Bank of Jamaica will be the sole authority to issue CBDC and to recognise the digital currency as legal tender.