The Tribune

A financial services provider has the Central Bank's launch of a Bahamian digital currency as "historic" and "a giant step" that will help propel The Bahamas ahead of many industrialised nations.

Robert Pantry, Simplified Lending's founder and chief executive, said his company - which has more than tripled in size since its launch two years ago - would jump at the chance to explore using the Bahamian digital dollar, known as the Sand Dollar, to speed up the process of approving and disbursing loan proceeds.

“On October 20, The Bahamas became the first country to roll out a Central Bank digital currency with the successful launch of the Sand Dollar,” said Mr Pantry. “This is a giant step in digital currency history, putting The Bahamas ahead of economic powers like China and the US in modernisation of domestic payment systems.”

He added that the decision to pursue a national digital currency arose not because of a desire to get out of the gate first, but from a need to find an alternative solution for residents in far-flung Family Islands where banking options are limited or non-existent - and becoming even more so.

“By creating the digital version of the Bahamian dollar backed by Central Bank giving it the same value as a physical dollar you can hold in your hand, Central Bank is meeting the needs of thousands of people and hundreds of businesses who need to pay their bills, buy goods and supplies and engage in trade without worrying about a brick-and-mortar bank branch,” said Mr Pantry.,

Besides filling a void, Mr Pantry said the Sand Dollar increases efficiency and reduces overall service delivery costs. “It virtually turns your cell phone into your bank so long as you are dealing with a payment or transfer with any merchant who has a Central Bank approved e-wallet,” he added.

Mr Pantry, a veteran banker and former managing director of RBC FINCO, said the recent announcement by a major financial institution to close most of its Family Island branches makes the need for a secure, efficient financial payment system all the more critical.

“Scotiabank was the most recent to announce impending closure of several Family Island branches, the latest to follow a trend as banks encourage customers to use online services," he added. "Many people are still afraid of e-banking because of cyber security threats and, for them, the closure of a bank meant returning to the old-fashioned way of finding someone to take money to Nassau to pay bills.

"Even for those who are comfortable with online banking, the advantage of a Sand Dollar transaction is its speed. The minute it hits a digital wallet, it is good as gold. There’s no waiting for a payment to move from one bank account to another.

“Peer-to-peer is the way of the future as we move toward a cashless society, and it is exciting to see The Bahamas take the lead. Interestingly enough, the Sand Dollar introduction is making history while the penny is fading into history," Mr Pantry said.

"That is also an intelligent move on the part of Central Bank.” It costs more than a penny to make a penny, and advocates of its removal from active currency have argued for years that its weight and volume bog down systems and bear high transportation costs.

Financial services regulators say the national digital currency will also strengthen efforts against money laundering, illicit activities and counterfeiting.

Six financial institutions have been granted the ability to provide Sand Dollars to residents, including Omni Financial Group, Cash & Go, Mobile Assist, Kanoo, Money Maxx and Sun Cash. Banks and other financial institutions are expected to be added soon.