High costs, low demand slow JAM-DEX adoption, says Bankers Association

The Jamaica Bankers Association (JBA) has cited high implementation costs and low customer uptake among factors that have slowed adoption of the central bank’s digital currency, JAM-DEX, by deposit-taking institutions.

Bank of Jamaica (BOJ) Governor Richard Byles on Tuesday criticised banks for their slow rollout, noting that Jamaica is pursuing a modern, less cash-dependent society.

JAM-DEX was introduced in 2021 and rolled out in phases from 2022, but uptake has been limited.

Among other measures, the BOJ has urged banks to upgrade point-of-sale machines to accept the digital currency.

In a statement, the JBA welcomed the BOJ’s initiatives to boost JAM-DEX adoption but said integrating the currency into existing banking systems requires substantial investment.

“Banks must absorb considerable costs to integrate JAM-DEX with their core systems and supporting technology infrastructure,” the association said. “These expenditures must be weighed against other technology investments that deliver more immediate and measurable value to consumers.”

The JBA noted that banks are prioritising upgrades that directly affect daily transactions and customer convenience, including improving cash availability at ABMs, enhancing the speed and reliability of RTGS and ACH processing, and strengthening online and mobile banking platforms.

“When compared with these widely used channels, the business case to prioritise JAM-DEX remains challenging,” the statement said.

The association also pointed to the experience of two member institutions with large client bases that have rolled out JAM-DEX but observed very limited customer uptake, a trend consistent with international central bank digital currency initiatives.

Additionally, banks’ finite technology resources have been directed toward other critical requirements, including the mandated migration to the ISO 20022 messaging standard.

Despite these challenges, the JBA emphasised that member banks remain committed to the JAM-DEX project.

“The JBA looks forward to continued dialogue with the Bank of Jamaica to identify practical and sustainable solutions that can expand access to payment systems as we work jointly toward achieving this shared objective,” the statement said.

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