A digital wallet developed in Bermuda has been granted a testing licence from the Bermuda Monetary Authority. Its founder says he is aiming to bring stablecoin payments into everyday local commerce and potentially solve a longstanding pain point for residents and businesses looking for an easier way to pay.

Berpay aims to let residents send money and pay businesses through their phones. However, the question remains of how money enters and leaves the app.

Berpay’s website says bank transfers and cash deposits are not available, while the “frequently asked questions” in its business section describe direct transfers to and from Bermuda bank accounts as forthcoming. For now, users must use external digital wallets or exchanges.

The BMA’s register lists August 26 as the effective date of Berpay’s Class T licence, covering payment services using digital assets and custodial wallet services.

Class T licences let companies test products or business models under regulatory supervision, with some restrictions.

Melvin Dickinson, Berpay’s founder and chief executive, announced the milestone on LinkedIn, describing the platform as developed specifically for Bermuda consumers and businesses.

“How can we use digital asset technology to make everyday payments easier for consumers and businesses?” he wrote.

He said he wants people to be able to use digital assets to send money, accept payments and get paid, rather than simply treating them as speculative investments.

However, he also acknowledged that the platform is still in development.

“There is still a great deal of work ahead as we prepare Berpay for the market,” he said.

The app is available to download for both iPhone and Android, with its advertised features including payment requests, transfers between users and QR code payments to merchants. One of its screens advertises that users can “send money like a text message.”

The Berpay website lists Mediaville, Pronto, Salt and Cedar, Tigermarket and Two Oceans Travel as participating merchants.

Colin Rego, founder and CEO of Sargasso and Pronto, welcomed the announcement in a LinkedIn comment, expressing support for the project and describing a collaboration involving his businesses and Berpay.

The Royal Gazette was able to download the app and submit an account application through a government-issued identification and selfie verification process. The application was still pending at the time of writing, with the app advising that approval could take up to 48 hours. Payment functions could therefore not be tested.

Berpay’s website says users can fund their wallets by transferring United States Dollar Coins on the Solana blockchain network from an external wallet or exchange. USDC is a stablecoin pegged to a value of one US dollar.

“Bank transfers and cash deposits are not currently available,” the website states.

The business FAQ says direct deposits and withdrawals to Bermuda bank accounts are forthcoming. Meanwhile, merchants are directed to external wallets to convert USDC and withdraw money into their bank accounts.

The proposed merchant pricing includes a 2 per cent wallet transaction fee plus a withdrawal fee.

The Gazette reached out to Mr Dickinson for comment. No response had been received as of Friday. Mr Rego was also approached for details.

Mr Dickinson is the founder of Mediaville, a marketing and digital agency. In a 2017 RG Magazine profile, he described getting his start by building a client website while at college and teaching himself programming. His business then expanded into digital marketing.

Bermuda’s push towards an “onchain” economy builds on years of positioning itself as a digital asset hub, beginning with the introduction of the Digital Asset Business Act in 2018 and deepening through partnerships with firms like Circle and Coinbase.

More recently, the Government has piloted stablecoin-based payments, including trials at the Bermuda Digital Finance Forum and plans to integrate tokenised payments across public services. However, the initiative has drawn concerns about the ease of withdrawing and depositing funds, potential scams and reliance on technology developed outside Bermuda.

Mr Dickinson is positioning Berpay as a potential solution. However, the banking connection remains unclear.

In February, Bermuda Commercial Bank addressed the onboarding question, describing technology that could connect conventional accounts with digital wallets.

Bermuda’s small market has traditionally limited access to familiar digital payment services. Andy Mielczarek, the BCB chief executive, previously told the Gazette that the investment required to introduce Apple Pay was hard to justify across a population of about 60,000 and four banks.

He argued that reusing infrastructure already developed for digital asset clients could provide the same convenience at a lower cost, allowing users to make payments through a simple checkout on their phones.

At the time, the bank stressed that it had not been appointed to the Government’s proposed on-chain payments project.

For Berpay, however, the published requirement to obtain digital currency through an external provider leaves an additional step between residents’ bank balances and their everyday purchases. The Gazette asked Mr Dickinson how the company plans to address that barrier.

Mr Dickinson dates Berpay’s beginnings to 2020. An application to incorporate Berpay Ltd appeared in the Gazette in December 2021.