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Remittance via digital wallets top US$1m year to date

Nearly eight thousand remittance transactions have been recorded since the start of this year via two digital wallets approved so far by the Bank of Jamaica, the central bank has said.

One of those wallets is the well-known Lynk app, which rolled out its remittance service in March. The second is by JN Bank, which got the greenlight as a digital currency distributor last year but is yet to publicly roll out its digital wallet.

JN Bank said it would respond to questions regarding its wallet and remittance activity at a later date.

The BOJ also said other wallets are at varying stages of development. GraceKennedy, which is a large player in the remittance market, has confirmed that its product is among them. But the conglomerate, which provides remittances as the exclusive agent for Western Union, also said that its wallet, while still under development in the BOJ Fintech Regulatory Sandbox programme, is already being used for remittances.

Group CEO Don Wehby said Friday that the GKOne App and Prepaid Credit Card “is at an advanced stage” and “has been available to customers since July 2022”.

“This makes it the first digital wallet in Jamaica to receive remittances digitally,” Wehby said.

Between the two approved digital wallets, a total of US$1.16 million was disbursed via 7,800 transactions, the BOJ said.

The amount is just a nibble of the remittance inflows to Jamaica, but the central bank told the Financial Gleaner that it expects the channel to grow and that remittances were expected to drive usage of its digital currency “where recipients opt to load remittance proceeds to their JAM-DEX wallet rather than accept disbursements via the other authorised means of payment”.

Jamaica is currently a US$3.5 billion remittance market, with inflows mainly coming from the United States.

For the month of January, the BOJ counted total remittance inflows of US$248.6 million, up two per cent year on year, and outflows of US$16.5 million, which fell by 28 per cent.

GraceKennedy Group says it has been offering remittance services through its GKOne app and wallet that was launched towards the end of last year.

“Customers can use the app to receive remittances, apply for a First Global Bank credit card, pay bills, shop on Hi-Lo Online, and access exclusive GK promotional offers,” said Group CEO Don Wehby.

“The GK One prepaid Visa card associated with the app can be used to make payments anywhere where Visa cards are accepted and at over 700 ABMs across the island,” he said.

The BOJ said there are no limitations on sending or receiving remittances via the apps. However, the funds must pass through accounts or payment instruments at a banking institution, and due diligence checks on the customers utilising the app for money transfers are required in conformity with Anti-Money Laundering/ Counter Financing of Terrorism guidelines and the Proceeds of Crime Act, known as POCA.

Adding user services is expected to grow usage of digital wallets.

“Note that the loading of remittances to the JAM-DEX wallet is one use. Other potential use cases that can drive utilisation include government payments, to include welfare and salary payments,” the central bank said.

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