Abstract
Central bank digital currencies (CBDCs) have been globally recognised as transformative tools for improving financial inclusion, particularly in developing countries facing persistent challenges. Using a desk review case study and a conceptual analysis approach, this chapter explores the potential of CBDCs to improve financial inclusion in Jamaica. The analysis indicates that Jamaica's CBDC, JAM-DEX®, can ultimately improve financial inclusion by expanding access to formal financial services, enhancing payments system efficiency, reducing financial transaction costs and fostering ripple effects for digital economy growth. However, challenges such as digital infrastructure gaps, low digital and financial literacy, limited merchant enrolment and heavy reliance on cash exist. The chapter concludes that the success of CBDCs in addressing financial inclusion challenges depends not only on their design but also on the effectiveness of a country's social, political, and economic institutions.
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