The Tribune

• Kanoo chair denies ‘biting off more than we could chew’

• Explanations for Cultural Festival payment challenges

• Central Bank affirms ‘compiling list of lessons learnt’

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Kanoo’s chairman yesterday denied that it tried to “bite off more than we can chew” over the payments woes that beset the two-day International Culture, Wine and Food Festival over the weekend.

Keith Davies told Tribune Business that “nothing could be further from the truth” when asked whether patron frustration over the long queues endured to enter the Collins House grounds, especially on Saturday, as well as problems encountered in loading funds and making payments threaten to undermine consumer trust in the Sand Dollar and digital payments more broadly.

The Festival was billed as the first event at which all payments for food, drink and other consumables would be solely digital via the Central Bank Digital Currency, but one patron described the first day as “a s*show” after they spent several hours trying to download the payment app and then attempting to load their digital wallet with the necessary funds. Speaking on condition of anonymity, they said the outcome showed The Bahamas is far from ready to go cashless.

This newspaper’s inquiries revealed a succession of problems that ultimately combined to impact the patron experience. The Festival’s organisers had selected Kanoo as the exclusive provider of Sand Dollar wallets, and sole payment facilitator, for the tens of vendors present. However, multiple sources suggested the pre-event advertising gave the misleading impression that Kanoo was also the sole supplier of digital wallets for patrons.

This was not the case, and visitors were able to select their provider of choice from all other authorised financial institutions (AFIs) permitted by the Central Bank to offer Sand Dollar services such as Bank of The Bahamas, MoneyMaxx, Island Pay, Sun Cash and Mobile Assist. However, due to the marketing many patrons believed they had to go to Kanoo to pay for all they consumed at the festival.

This was then compounded by the fact many arrived having not downloaded the Kanoo payment app or that of any other provider. Those who tried to download when they reached the Festival site on Shirley Street experienced long delays due to insufficient wireless Internet (wi-fi) bandwidth capacity that was unable to meet demand from hundreds of persons.

Kanoo sought to provide an alternative to downloading the app by providing patrons with an NFC (National Cultural Festival) wrist band that could be loaded with Sand Dollars. Most opted for this solution, and Mr Davies admitted yesterday that the digital payments provider had not anticipated the level of demand for these bands, which had to be activated and loaded. It was this, he explained, that caused the long lines and hour-long queues to enter the Festival on Saturday.

John Rolle, the Central Bank’s governor, last night confirmed that the regulator is conducting a post-mortem into events at the Festival. “After the weekend we are compiling a list of lessons learnt,” he said in a statement to Tribune Business yesterday evening, which largely repeated a previous release.

However, Tribune Business can reveal that the Central Bank was sufficiently alarmed by what occurred on Saturday that it contacted Kanoo’s rival Sand Dollar providers on Sunday morning to see if they could assist and ensure there was no repeat of the problems experienced on Saturday. This newspaper was also told there were occasional problems with some band scanners, leaving both patrons and vendors frustrated over the inability to make payment.

“By no means did we bite off more than we could chew,” Mr Davies replied, when questioned by Tribune Business. “The second day, when we were able to pivot to deal with the demand that showed up, things went quite well.” He acknowledged that too few persons had arrived at the Festival prepared to participate by having downloaded Kanoo’s or another provider’s Sand Dollar payment app beforehand.

“The persons that downloaded the app and got loaded with funds before arriving at the Festival, took up with Kanoo and got ‘Level 2’ verification to add credit and debit cards to load funds, they had zero problems,” Mr Davies said, adding that the event had provided a revealing glimpse into how many Bahamians have yet to become “comfortable” with digital payments technology.

“The lines people saw were because persons did not go digital. We offered a solution through bands; digital bands where you simply tap and pay. Initially that was designed for dependents and tourists who came in and did not have direct ties to The Bahamas.

“Yet it turned out that most people wanted those bands. The bands had to be activated and loaded. That’s where the issue came. On the first day the demand far exceeded the purpose and expectation we had for that. The first step was for persons to download the app and not enough did. For us it’s lessons learned and we think about the future. There are placed in The Bahamas that go without cash and work very well.”

Mr Davies said the overnight adjustments by Kanoo, and patrons learning they could use any Sand Dollar-approved provider, meant there were “less problems” on Sunday at the Festival despite there being “almost double the people”. He, too, said the failure by many patrons to download the necessary apps before arrival was made worse by the lack of sufficient wireless Internet capacity to handle the demand on-site at Collins House.

“There was a change to a new venue and, for the first time, Internet coverage was provided at an event,” he told Tribune Business. “If you understand technology there are ebbs and flows with respect to connectivity. Although that was not a Kanoo problem, there are lessons to be learned and ways to mitigate that. I’m sure the providers there learned from that and it will be better next time.”

Asserting that “a vast amount of transactions” numbering in the thousands, and involving “tens of thousands of dollars”, took place using Sand Dollars, Mr Davies denied that the woes experienced threaten to undermine public trust and confidence in the Bahamian digital dollar at a time when the Central Bank is seeking to push its adoption as a payment mechanism.

“Far from it,” he replied. “It was a tremendous success for persons there. The patrons had a good time. The results speak for themselves. We had persons that came come on Saturday and were very angry with the line and things that occurred. We had some persons come back on Sunday and have a glorious experience. In terms of undermining the Sand Dollar, far from it. Nothing could be further from the truth.”

One prominent patron who attended the Festival on Saturday, speaking on condition of anonymity, detailed the problems and frustrations they encountered. While understanding what the organisers, Central Bank and payment providers were seeking to do via a cashless event, they argued that “they screwed up” by not providing debit and credit card options.

“I spent an hour and 15 minutes trying to load an app from one of the providers and, after I got it loaded, I was told I then had to go and load it with funds at a kiosk of which there were none,” they said. “How could you set that up knowing people have to load cash into this system and there was no way to do it on-site?

“It was an hour-and-a-half to get in and an hour-and-a-half to load your card. You’re not interested at that point. Is The Bahamas ready for a switch to completely digital? The answer is ‘no’. Cash is king. I’m from the old school and the digital stuff is frightening.”

Other digital payment providers agreed that the Festival was potentially a great testing and proving ground for the Sand Dollar “in a closed and controlled environment”. Yet they argued that the Central Bank should have been more forceful in ensuring it was used as an opportunity to promote all Sand Dollar-approved providers - not just Kanoo.

“It’s a learning curve,” one added. “I think it was a great opportunity for us, but I think we missed the boat on marketing all digital wallets. The Central Bank should have been more insistent on all AFI’s being promoted, all AFIs being there.”

Others were forceful. “People need to be equipped before they go to the event,” one added. “You bring thousands of people to a venue who have no idea of the tools they need to participate. This has damaged the brand of Sand Dollar. It’s put a bad taste in everybody’s mouths over the Sand Dollar and digital payments. The Central Bank needs to make a statement to give confidence back to the consumer the Sand Dollar works.

“They put all the risk on one provider and they failed. They [Kanoo] were supposed to meet the demand. You cannot put 5,000 in the same spot and ask them to use the same wi-fi. It takes too long. You had to stand in line to get in, and take another hour to download the app. You had to wait two-and-a-bit hours before you could buy a beer.”

Another added bluntly: “That was a debacle, a complete debacle, what happened on Saturday and Sunday. It was embarrassing. It was a total mess up.” Mr Rolle, in his statement, said: “We can’t speak to the total amount spent. However, the Central Bank placed at least an extra $200,000 into circulation.

“After the weekend we are compiling a list of lessons learnt. To be clear, cash top-up during events will become less important in the future because we are increasing the means of acquiring funds via bank transfers. As well, the number of outlets that accept Sand Dollars will increase.

“The Authorised Financial Institutions have already on-boarded the two major food stores in New Providence. We now have before us the task of educating the frontline employees in those food establishments,” he added.

“In the meantime, we have completed the core developments to allow Sand Dollars to be deposited back into the banks. This is an important requirement for businesses. The Authorized Financial Institutions are now being asked now to tailor their proprietary platforms to make this direct convenience available to the public.”