Adrian Loveridge Column – COVID 19 Exposes Some Businesses
It is almost impossible to intelligently speculate on the ongoing Coronavirus crisis, as it appears to radically change by the minute, so I will attempt to avoid it until some middle to long term scenario comes into place. My apologies if circumstances have overtaken the time between writing, and this column appearing in print.
As a small business person spanning over 50 years, our concentration and efforts will now be spent on survival, until hopefully a form of normality returns, so that we can reasonably think beyond damage control.
How can we defer or delay essential ongoing payments like various utilities and Government taxes without being subject to penalties and what at this stage can only be described as usury rates of interest. Obviously areas are electricity and water, but in the first case you still cannot, in this technological age pay online or by personal visit, using a credit card.
With our water bill, paying by credit card still involves a personal visit, but how much longer this will remain, we are as yet unsure, until, their offices are inevitably closed to help minimize the possibility of infection.
We can currently pay our telecommunication bills online, but even with the threat of disconnection, have taken the decision to postpone payment, as we feel it is grossly unfair, the $1,000 security deposit we paid back in 1989 has not attracted a single cent of interest, at least to us.
At a modest rate of 4 percent annual interest compounded over 31 years, that $1,000 would be worth almost $3,400 today.
And before anyone points out that 4 per cent interest is an overly optimistic one, then think back to the nineteen nineties, when that decade recorded an average yearly base rate of 7.9 percent before commercial banks added their margins.
Even Barbados Light and Power pays annual interest on deposits, albeit at a much lower rate after the Canadians took over. How on earth has this inequity been allowed by our regulatory authorities for so long and it makes you question their effectiveness and/or impartiality.
Paying by cheque is of course, still a reluctant option, but an expensive and time wasting one, when you take into account the issuing and processing fees, especially when relatively small payment amounts are involved. No-one in their right mind intentionally visits a bank branch any more, unless there really is no practical alternative and exactly how banks will remain open and observe anything close to ‘social distancing’ remains a mystery.
If ATM’s are kept functional, then strict disinfecting protocol will have to be effectively implemented and enforced. The banks too, have to fundamentality change the way they conduct business, if we are going to see any form of rapid recovery following some form of emergence from the current crisis.
As this column goes to press, I am still awaiting, three weeks after applying for a debit card for its arrival, to help reduce physical bill paying. Repeated follow-up voicemail messages to our branch go unanswered for days.