Bahamas to Regulate Banks to Offer Cbank Digital Currency

• The Bahamas, the first country in the world to issue a central bank digital currency (CBDC), is now preparing regulations that will require commercial banks to provide access to the e-money in a bid to stimulate adoption.
• The Bahamas' role as a CBDC pioneer (issued its "Sand Dollar" digital currency in 2020) means that what it does in the Caribbean is closely watched by the more than 130 countries, from Europe to China, that are now exploring digital versions of their currencies.
• John Rolle, the islands' central bank governor, who oversaw the Sand Dollar's launch nearly four years ago, said with take-up still limited, the carrot was turning into the stick and commercial banks were now being told of regulations that will effectively force them to distribute it.
• CBDCs have proven a point of contention between central and commercial banks, with banking lobby groups warning that the currencies could encourage deposit flight because they effectively offer the public a bank account at the central bank.
• Ordering banks to make the Sand Dollar available would require them to make significant changes to their information technology (IT) systems, but the Bahamas central bank sees it as vital to boost the CBDC's adoption and mobile payments more generally.

(Source: Reuters)