Barbados firms lead mobile payment acceptance

FIRMS IN BARBADOS are leading the acceptance of mobile payments when compared to their counterparts in 12 other Caribbean countries.

None of the islands, however, have accepted cryptocurrencies, which are not backed by central banks, as a payment option.

This was the conclusion of the study COVID-19 And The Usage Of Digital Currencies, which investigated the impact of COVID-19 on the usage of digital currencies in the Caribbean.

It was conducted by economist, Professor Winston Moore, Deputy Principal of the University of the West Indies, Cave Hill Campus, and UWI tutor Gideon George of the Department of Economics.

They said the findings “suggest that policymakers should employ measures to enhance the telecommunications and electrical systems so that firms are better able to harness the use of digital currencies”.

“It is evident from the data . . . that even though some firms have heard of these electronic payments many still do not accept them as a payment option. The statistics suggest that 91.35 per cent of firms do not accept mobile money. For cryptocurrencies, zero per cent of firms accept them as a medium of exchange,” the report stated.

“Based on the country data, it is evident that Barbados has the highest mobile money usage (20.51 per cent) in the survey while Belize has the lowest (0.70 per cent).

Countries ranked in between Barbados and Belize for mobile money usage were St. Vincent and the Grenadines (14.29 per cent), Grenada (13.75 per cent), Trinidad and Tobago (13.27 per cent), Guyana (9.57 per cent), St. Kitts and Nevis (9.52 per cent), Suriname (6.90 per cent), The Bahamas (6.49 per cent), St Lucia (5.97 per cent), Antigua and Barbuda (4.82 per cent), and Jamaica (2.80 per cent).

The research paper utilised data from 1 979 companies across 13 Caribbean countries which participated in the Innovation, Firm Performance & Gender (IFPG) Issues in Enterprises In The Caribbean Survey (2020 & 2021) conducted by the Inter-American Development Bank in partnership with Compete Caribbean.

Moore and George said the empirical results of their paper have produced several interesting findings.

“The first is that even though mobile money and cryptocurrency are both types of digital currency, the cryptocurrency or mobile differently to the independent they said.

The researchers noted, “while older firms are mobile money, age is significant factor when cryptocurrencies or even new payment features “If telecommunications obstacle to the ease of were less likely to accept but more likely to accept The difference in response by the fact that mobile relationship with banks does,” the paper continued.

“Also, mobile money several cryptocurrencies like assets than currency. status of telecommunications the ease of doing business determinant of the decision payment systems.

“Additionally, firms larger share of the local jurisdictions are more new services such as payments in a post COVID The report added: time, firms that operate international market still likely to sustain “The cost of finance determinant of sustaining the decision to accept mobile money often react independent variables,” noted, for instance, that are more likely to accept not a statistically when deciding to accept even maintain these features after COVID”. telecommunications were a severe of doing business, firms accept mobile money, accept cryptocurrencies. response could be caused mobile money has better banks than cryptocurrency continued. money is easier to use as cryptocurrencies tend to behave more currency. Surprisingly, the telecommunications as an obstacle to business is an insignificant decision to sustain these firms that have a local market, in their more likely to maintain digital currency COVID world.” “While at the same operate mainly in the market or national market are digital currency systems. finance is an insignificant sustaining digital currency payments however, if the firm’s competitors are major threats to their daily operations, they are more likely to sustain digital currency payments in the long run.”

The study said that firms operating in Barbados, Grenada, Guyana, St Vincent, Belize, or Trinidad and Tobago were more likely to accept mobile money; while firms operating in Barbados, Dominica, Grenada, Guyana, The Bahamas, and Trinidad and Tobago were more likely to accept cryptocurrency except for Belize where firms there were less likely to accept cryptocurrency”.

“Companies located in Antigua and Barbuda, Barbados, Dominica St. Kitts and Nevis, or St. Lucia were less likely to sustain these new payment features after COVID. Perhaps the difference in innovation scores for the countries could explain the varying results,” Moore and George said.

In addition to help from policymakers, the report said that “another way to sustain the use of digital currency is to educate the public on the advantages of digital currency usage”.

“A populace with a better understanding of how virtual currencies operate are in a better position to capitalise on the system,” they said.

“Central banks which are yet to begin researching and experimenting with central bank cryptocurrency should lead the way in their respective jurisdictions and thereby partner with local firms to integrate these virtual currencies into society.” (SC)

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