NASSAU,BAHAMAS – The government is working with the Clearing Banks Association and domestic micro-financing institutions to promote and facilitate the country’s transition to a cashless society, according Deputy Prime Minister and Minister of Finance K Peter Turnquest.
Turnquest was speaking at the opening of the Royal Fidelity Bahamas Economic Outlook.
He said: “Cashless commerce and other innovative technological solutions can allow commercial banks to operate without the need for a physical presence, which is critical in our archipelagic context. As we know all too well, when disasters, banking services are often disrupted.
“On the other hand, telecommunications systems are often the first to be restored. With the move to cashless commerce, communities can have rapid access to the financial system to rebuild their lives.”
The Central Bank of The Bahamas launched the Sand Dollar digital currency on Abaco last week.
Turnquest flagged the program as “a monumental initiative” that will create sustainable solutions to the risk associated with natural disasters, strengthening financial inclusion and resilience.
“The Sand Dollar is equivalent in every aspect to the paper currency with its value fully backed by the external reserves of the Central Bank,” he said.
“Through the Sand Dollar, Abaconians can now make payments at local grocers or gas stations right through their mobile devices in real time. The sand dollar also allows for feeless peer-to-peer transfers.
“Of course, legal frameworks and regulatory systems are needed to support technological innovations in the financial sector. Even in this area, The Bahamas has been ahead of the curve. In 2016, the Central Bank issued a set of technology risk management guidelines to provide guidance and oversight for the advancements taking place domestically in social media, internet banking, and mobile technology.”
Turnquest said: “These guidelines help to mitigate IT and cybersecurity threats that undermine system soundness, customer data confidentiality and overall financial stability. ”
He furthered the country is focusing on practical solutions to the critical macroeconomic and development challenges it faces, including putting in place a comprehensive Disaster Risk Framework for Better Fiscal Management.
The framework includes different types and sources of financing, including different types and sources of disaster financing: Grants, loans, proceeds from dormant accounts in the commercial banking system, CCRIF, donations, catastrophic bonds.