The digital wallet space will not grow without merchant buy-in, Moneymaxx Chief Executive Officer Karlos Mackey said yesterday, explaining that the retrenchment of commercial banks, especially in the Family Islands, will be an important catalyst to lead that buy-in.
Mackey, a presenter on digital currency at next week’s Bahamas Business Outlook, added that digital wallets became a perceived need and an actual need last year because of the COVID-19 pandemic, but he contends that the ramp-up in the use of digital wallets and the use of The Central Bank of The Bahamas’ (CBOB) digital currency, the Sand Dollar, will continue to be phased in through 2021.
“I think COVID-19 has provided us a situation where perceived need and actual need in some respects do align,” Mackey said.
“For the mobile wallet space to really take off, merchants have to be a bit more comfortable and I think with the retrenchment of some of the commercial banks, especially in some family island communities, we’re seeing a lot more openness now by small and medium-sized businesses in particular.”
He added that as more small and medium-sized businesses, “from Grand Bahama and Abaco in the north, to MICAL in the south begin to get more comfortable with having different means of accepting payments”, more consumers will become comfortable with the idea of using a mobile wallet.
“In every industry there is a ramp-up phase,” he said.
“As far as digital wallets go in The Bahamas, we’re still in the ramp-up phase. How long that ramp-up phase will last is a function both of what I would call the innovation and attractiveness of digital wallets, but also the perceived need.
“Sometimes we’re able to create a perceived need, but we know that in some markets for some products, perceived needs are only created when there is an actual need.”
He explained that right now the use of digital wallets by consumers and the corresponding merchant use is a “chicken and egg problem”.
“Some merchants don’t want to get on until there is a critical mass of consumers,” said Mackey.
“But I think with the retrenchment of the banks, more merchants and more consumers, particularly in the Family Islands, will get more comfortable in 2021.”
Moneymaxx is an authorized entity to distribute the Sand Dollar and Mackey lauded the CBOB’s efficiency and execution of its rollout.
“For those of us who have been vetted, passed through the process and have been approved as Moneymaxx has, the rigor, level of communication and the effectiveness of that communication has been superb,” he said.
“What you have now is a digital currency ecosystem where the Sand Dollar has a group of providers that are essentially providing world-class mobile wallet solutions.”