Central Bank of The Bahamas announces the launch date of the central bank digital currency called Sand Dollar. Bahamas will be the first-ever country to launch CBDC.
Gradual Release in Phases
The digital version of the Bahamas Dollar, Sand Dollar, will be released in gradual phases. The central bank will “gradually release a digital version of the Bahamian dollar nationally, outside of the pilot regions of Exuma and Abaco, through authorised financial institutions (AFIs), beginning on 20th October, 2020.”
The name Sand Dollar is assigned to both initiative and the digital currency of the country. The project Sand Dollar is a part of The Bahamas’ Payments Systems Modernization Initiative (PSMI) which launched in 2000s. In the first phase, private institutions will have access to digital currency such as, banks which will set up KYC compliance.
“The first phase of the national rollout, focused on the immediate readiness within the private sector, will cover all three tiers of authorised accounts. These account tiers are each subject to risk-based customer due diligence or “KYC” requirements. These are low-value personal wallets with the least demanding account opening requirements but with more restricted transaction limits; regular personal accounts in line with the established, flexible customer due diligence for existing banking and financial services; and business or enterprise accounts, subject to further KYC rigour and with higher limits for transactions and holdings of the digital currency,” the announcement reads.
In the second phase, it will be available for public organizations by 2021. “The second phase of national engagement will target Government services and public utilities, becoming more intensive over the course of the first and second quarters of 2021,” the announcement reads.
Sand Dollar will be issued through authorised financial institutions (AFIs). For security purposes, “Sand Dollar-integrated wallets are enabled with multi-factor authentication features. All mobile devices are required to support a device passcode or biometrics to access the app and complete transactions. These, of course, will be supplemented by the due care and attention that each digital payment user will be required to observe for all transactions which they undertake.”