Financial Technology Developer Alex Straun has told financial stakeholders in the Eastern Caribbean who are considering using digital currencies they must ensure that the system is simplified in such a way that everyone can use it.
“If e-money is to be widely adopted, then it must cater to not just only the computer literate persons, [or] not only the businesses. If that doesn’t happen, then we are creating a two-tiered society, and that two-tier society would cater to almost like an underground market and some nefarious activities”, Straun explained in the latest Eastern Caribbean Central Bank (ECCB) Connects programme.
Too many times, he said, you hear solutions being developed, but they are targeting the brilliant people, the people who are totally comfortable; and the other person is left out, and those are the ones who tend to be vulnerable to robberies or crime.
Straun said if the region is to seriously consider the transition from cash to electronic money, “solutions must always be inclusive” and “if the solutions that are being developed and implemented are not packaged and put in a way that they can be broadly adopted by everyone, in terms of access and circulation, then it makes it even more difficult.”
Straun explained that using electronic currencies such as bitcoins can seem so complex that it becomes an issue, adding “I think before we could get into digital currency, persons must transition through generally e-money before they could deal with currencies that they are not accustomed to.”
Electronic money is money which exists only in banking computer systems, and is not held in any physical form. In the United States, only a small fraction of the currency in circulation is in physical form.
However, that is not the reality for Eastern Caribbean countries, which mainly utilise cash, apart from the use of debit and credit cards.
The financial technology developer said whatever system is going to be used to introduce digital currency into the region, must apply the fundaments of a cash transaction, where all one needs is the ability to count or to recognise value, or that of a cheque system where the sender would only need to know who you are.
“Any e-money innovations have to adopt similar approaches and that’s how easy it is for me to transact with you,” he stressed.
But with any barter system, using digital currency has its risks.
More in today’s Daily Observer.