During the current lockdown it’s perhaps an ideal opportunity to reflect on the positives and negatives of an everyday small business and hope that these experiences can benefit us all in the recovery days to come.
While not directly tourism related, any reasonable person has to ponder what on earth was on the minds of the management of one or more ‘local’ banks to increase their charges during the current pandemic, especially when it was abundantly imminent that another lockdown was about to be enacted.
When the majority of customers are already reeling from the effects of dramatically reduced ‘service’ delivery, the closure of branches without any meaningful consultation with the people who fund their operation and being literally forced into migrated online websites, some of which are far from user-friendly.
In our own personal transactions over the last couple of months, the tardy response of at least two different banks that we deal with have caused us substantial monetary losses and hugely increased unnecessary stress.
Even when the particular bank makes obvious mistakes, the procedure often involves lengthy phone calls to remote ‘customer care’ centres and spent precious hours rectifying their problem, all at our expense, in terms of time and resources, without even a hint of an apology or compensation.
Sadly as a country we have grown to accept a diminished level of service from our financial institutions, at least partially due to Government default of debt, giving these organisations little opportunity other than to extract additional revenue from the ‘little people’ to make up that deficit.
What is so alarming is that the overwhelming number of businesses here, both small and large, will critically depend on these lending entities to sustain them until some degree of normality and viability returns.
And with seemingly such detached directors at the top of the management tree, which can only be a logical explanation for the poor levels of service meted out by the lower level of employees, it is difficult to comprehend how many of our private sector entities will survive.
Perhaps the biggest puzzle is why do we tolerate such a general poor level of service, when the majority of these foreign owned banks could not get away with it in their own domains located in the more developed countries?
My first days as a lifetime entrepreneur at the age of 12 years were spent walking door-to-door with a cheap suitcase selling kitchen items to houses in the UK from the monies I earned selling imperfect shirts from stalls in markets like London’s Petticoat Lane.
In the near six decades that have followed, I have desperately tried to understand how bank managers and their employers rationally think and sadly, do not appear to be any closer to comprehending them.
But I do know that unless there is a seismic shift in the way that ‘our’ banks respond to the immediate needs of local small to medium size businesses in the very near future, many of those enterprises will cease to exist by the end of this year.
That will inevitably take a further toll on Government coffers, so perhaps it is now long overdue that the current administration bites the bullet and encourages banking reform.
Source: Nation
To make matters even worst…… went to deposit a cheque at the ATM and there was a sign stating that Deposits were not allowed until after Feb.10th…… I thought the PM made it clear that Banks, etc. could continue with back-room staff, but not f-2-f retail banking, during the Pause????
How can I pay bills online if I can’t deposit funds??? RIDICULOUS!!!! How can people paid by cheque survive???
If my assumption is wrong re back-room opening, then the Government is RIDICULOUS!!!!
The writer is obviously not an expert in banking and finance.
The landscape has long changed where a whole host of players have markedly transformed what he believes a bank should be.
High street banks no longer derive revenues from the traditional sources at the same rate, as a result, to stay in business exorbitant fees are charged, all over the world.
It is now possible for a single company or individual to have their own bank in a box.
In addition the competitive environment is now populated by shadow banks, hedge funds, non-bank banks etc.
Financialization means that banks, companies and high net worth can make more money from trading in financial assets than bricks and mortar. No need for investments in hotels. LOL
Several decent doctoral dissertations have been written on this subject for the last 40 years.
This is what a financialized economy looks like. We have warned you for 30 years.
High net worth individuals
The bank calls me up and says because of covid you can defer interest payments on a commercial property for three months, thought about it said sure , gave the tenants a break on rent, after 3 months I noticed bank had added the 3 month interest to mortgage so now I am paying interest on interest lol. Man banks never let a crisis go to waste.
The statement about the Bank back offices being opened while the branches were closed baffled me too, Back offices in the main carry out functions that were formerly done in the branches so if the branches are closed then there is hardly any work for those in the back office to perform.
@Sargeant
From reports published banks have disabled the deposit function on some ATMs.
David
Understand, those services from nay nay depositors represent losses.
@Pacha
The comment was directed to ks. Your earlier point is taken.
David
We would like to see the internals of the credit unions to see how they fearing in this brand new world.
“No need for investments in hotels. LOL.”
even if they have a hangover, that should wake some people right up……😂🤣
am sure it’s going to take some with determined heads another 10-20 years to see where this is headed..so buy up the popcorn.
but that’s not all…
This is one column from Adrian with which I can agree.
What was explained to me a few tears ago waiting in the que at one of your banks, even though it says scotia it really isnt scotia canada its a separate entity. I wanted to complain about something further up the food chain in canada and coudnt they just use the name.
@ Lawson,
Inside Scotiabank
Scotiabank is a leading multinational financial services provider and Canada’s most international bank. We provide innovative financial products and services to individuals, businesses, corporations, and governments across Barbados and around the world.
https://bb.scotiabank.com/about-scotiabank/inside-scotiabank.html
@ WURA-War-on-U February 8, 2021 10:58 AM
“No need for investments in hotels. LOL.”
++++++++++++++++++++++++++++++++
That’s going to be the next big topic for serious discussion.
Quo Vadis hotel-based tourism in Barbados?
A major question of concern often raised often by our futurist “PLT” iro the economic development of Barbados.
Now that the Covid whipping boy has provided an escape route to the Bajan “Principals” behind the proposed Hyatt hotel erection one is left to speculate what is going to happen to that US$175 million just sitting there lying idle in some bank account.
Can’t that idle capital be compulsory acquired (like the Ram rat pen or even the pending acquisition of the Drax Hall plantation) by the MAM administration to either buy the local CIBC lame duck and convert it into some national phoenix for a Post Office bank as long ago proposed by Hal Austin?
Maybe the NIS can be privatized and sold for a song to the former financial backers of the now cancelled Hyatt investment project with that idle cash used to recapitalized as a matter of an emergency the NIS fund which is on the verge of collapse with Covid blamed for its current comatose state.
Miller…for the amount of lying these politicans do, they should all wake up one morning and have no tongues in their mouths, just a big old hole..
@Lawson
you were led astray. It maybe a separate legal entity, but its a wholly owned subsidiary and they report to Canada.
@ WURA-War-on-UFebruary 8, 2021 6:30 PM
It seems Covid has effectively put paid to tourism in Bim; at least for the short-term.
A casualty of which has been the cancellation- euphemistically called the ‘indefinite’ deferral according to the head honcho and chief spokesman for the Barbados Private Sector- of all plans for investment projects in that sector (like the Hyatt concrete behemoth).
Shouldn’t the all-red fowls in the political yard like your bosom buddy “Enuff ” and his rooster sidekick Lorenzo be calling now on the MoF to take the necessary steps to recover the duties and taxes which should have been paid on that luxury Mercedes still being driven around by a ghost for a Sales Director working for a hotel which will not see the light house of an erection day in the near future?
Wouldn’t this windfall come in handy to help defer the massively unaffordable bill the Treasury is facing with the government’s ongoing war on Covid?
After all, every little bit helps when every Sammy Couchie and every Donna Duppy has a begging bowl outstretched to MAM in the Treasury almshouse holding taxpayers’ monopoly monies.
As the no-longer high Lord Nelson would have said to every ‘loyally honest’ Bajan:
‘All hands on deck!’
‘Barbados expects every one to pay his duties and taxes specifically those who can easily afford and enjoy imported luxuries’ especially during the country’s darkest hour and most pressing time of need’.
MillerFebruary 8, 2021 6:04 PM by the MAM administration to either buy ….
Anyone buying a bank now, would have to be paying substantially less than par on the dollar. Likely significant provision on any loan portfolio.
Adrian L ”the tardy response of at least two different banks that we deal with have caused us substantial monetary losses and hugely increased unnecessary stress.”
What does that say? The banks cater to the international business sector and wealth management. THAT is their current raison d’etre in these islands.
Do you really think that they care about smaller operations? Not enough $$$ in it. They would prefer to use that capital elsewhere.
Hence, why I agree totally with Hal on a Post Office bank, or Credit Union CoOp Bank, to service the majority.
There is not much future for small business and individuals with the large banks.
However, the business plan for the CoOp bank needs a serious assessment of what assets it wishes to invest in, to achieve viability going forward.
Other than that, maybe Adrian L et al can discuss the matter with Bitt, with an eye for some transactions? Eventually everything will be crypto anyway, now could be a good time to get into it, as there is no satisfaction from traditional means.
@ Lawson
International corporations operate as silos, even if they are wholly owned subsidiaries or branches. Barclays Bank did the same.
If you wanted to bank with Barclays in Barbados one had to go to Barclays International in Knightsbridge. High street branches would not touch you.
@ Crusoe
All it needs is a basic retail banking model: you do not need online and telephone banking; interest paid on savings will be lower than interest charged on loans.
Such a bank will offer credit cards, debit cards, standing orders, direct debit, ATM, cheque (current accounts), savings accounts, residential mortgages and small business loans and banking facilities.
No investment banking, no special purpose vehicles, no SIVs, etc. Just a common and garden bank. Maybe corresponding banking for European and North American transactions.
There are good models we can follow: community banks in the US, building societies in the UK, or German Landesbanks.
@ Hal
I am still waiting for somebody to explain why the Credit unions don’t have banks. All the credit unions money in the same banks that exploiting us.
@ William
Courtney Blackman did a report for them some years ago, but nothing has come of it. I believe it is the legislation. Both DLP and BLP governments have hindered the development of credit unions banks.
It comes back to what I said about the ignorance of our lawyer/politicians. If they do not understand something they stand in the way. Banks is an example, so is the NIS. They do not understand finance.
This is not correct. All the major credit unions are not onboard. Also a credit union bank will be restricted on the asset of if the business based on capital requirements.
Adrian is a TYPICAL BAJAN, its not my fault attitude. Most Bajans are all talk and very little walk. Its your country, get off your lazy asses and make things work and stop blaming others for your ills.
Wily will ask Adrian a simple question, what would the situation be in Barbados if they had no foreign banks but only domestic Bajan government owed banks. We all know the answer to that, no audits, corruption, FAILED STATE etc.
Northern I cant remember all the details but I do all my business with scotia and I was having difficulty transferring money, or opening an account in barbados but i remember being so frustrated with scotia on the island and my own bank not being able to do anything I was going to move my business accounts and mortgages to cibc.
Lawson, everything in Barbados is about frustration. The easiest of transactions elsewhere, become difficult in Bim, and half the time they eff it up. Getting money INTO Barbados is a piece of cake, just try getting it out !!! This is why, as was mentioned some weeks back, a whole host of property is owned by offshore corporations. You buy the corporation, whose only asset in said property, and then you avoid all the local roadblocks. And you don’t have to fight with the CBB about getting foreign currency out. I have no plans on again owning property there, but if I did, this is how I would set it up.
Having said that, the same banks can be a pain in the ass in Canada, when it suits them.
“Shouldn’t the all-red fowls in the political yard like your bosom buddy “Enuff ” and his rooster sidekick Lorenzo be calling now on the MoF.”
2 Slaves and a sellout, nothing is going to get done.
have had bank accounts both in Bim and Canada, service sucks in both,in Canada employees dont work for the banks for very long, constantly new staff who dont know the customers and dont know about anything other than taking deposits, or handling withdrawals. try dealng with Rogers wireless, Bell Canada etc.institutions have us by the short hairs and squeezing
@ Hal
Didn’t the BNB have its genesis in the Agricultural Credit / Savings Bank?
Just asking , I honestly can’t remember.
Wuhloss, Lawson complaining about poor service that he received at the Bajan arm of his Canadian bank which is a first for people with his melanin. Just last year I was at a branch of another Canadian bank dutifully waiting in line with other bajans for non- monetary service and the single clerk was taking his time while the line kept getting longer. There were other people working but they were keeping their heads down, shuffling their papers, taking the occasional phone call but not making eye contact with those who were silently imploring them with occasional glances to assist the clerk at the side counter. Then a miracle happened two bajans of lighter hue ( lets call them white) joined the line and abracadabra – papers were shunted aside and those behind the desks acted as one to approach the counter to assist us.
One of the them approached us individually seeking to determine what our needs were and when she got to the last bajans who joined the line his needs were deemed more important as she opened the side door, sat him (and his companion) at her desk and proceeded to complete their business.
As the late Bob Marley sang “Emancipate yourself from mental slavery”, and Lawson consider your plight an aberration.
@ William
The BNB was the result of the Barbados Savings Bank, the Sugar Industry Agricultural Bank and the National Housing Corporation Loan Fund being rolled in to one.
I also seem to remember Barrow buying out the local branch of the Bank of Credit and Commerce International. As to managers, I also remember Robinson and Greenidge, both trained in Canada.
This is incorrect, Mutual/Sagicor bought out Bank of Credit and Commerce.
“Then a miracle happened two bajans of lighter hue ( lets call them white) joined the line and abracadabra – papers were shunted aside and those behind the desks acted as one to approach the counter to assist us.
One of the them approached us individually seeking to determine what our needs were and when she got to the last bajans who joined the line his needs were deemed more important as she opened the side door, sat him (and his companion) at her desk and proceeded to complete their business.”
those are the slaves, they make Black people’s lives miserable, refuse to serve them, make the elderly wait in line for hours unnecessarily, they are rude and disrespectful, uppity and repulsive……
as soon as they see someone with a lighter skin color, they perk right up and are all business….until they leave then it’s back to being useless…those slaves SHOULD BE SOLD….won’t want any of them cleaning my toilets.
It is true the Barbados Savings Bank, Sugar Industry Agricultural Bank and National Housing Corporation – Public Officers Housing Loan Fund, were amalgamated to form BNB. It was incorporated in March 1978, in accordance with the Barbados National Bank Act – 1978.
The assets of Bank of America were acquired the day following commencement of BNB’s operations and it was officially opened on Monday, April 3, 1978 by then PM ‘Tom’ Adams.
Credit unions back off from bricks-and-mortar idea – Credit unions back off from bricks-and-mortar idea: https://barbadostoday.bb/2021/02/09/credit-unions-back-off-from-bricks-and-mortar-idea/
@ David BU
I believe you’re correct. The Mutual Bank of the Caribbean Inc. was established in 1993, through a Central Bank managed sale of BCCI’s local operations.
Barrow died in 1987, four (4) years prior to the collapse of BCCI in 1991.
February 10, 2921
Special thanks to the Government and People of India, for their generous gift of 100,000 Jabs of AstraZeneca’s Covid – 19 Vaccine.
By Reuters
Thursday , 9 February 2021 07:21 GMT
India orders 10 mln more doses of AstraZeneca vaccine from Serum Institute
NEW DELHI, Feb 9 (Reuters) – India’s government has ordered 10 million more doses of the AstraZeneca COVID-19 vaccine from the Serum Institute of India, a company spokesman told Reuters on Tuesday.
The world’s biggest vaccine-making company had earlier supplied 11 million doses to the government’s inoculation campaign that began on Jan. 16. (Reporting by Krishna N. Das; Editing by Christian Schmollinger)
British Metro News
Wednesday 10 Feb 2021 12:25 pm
Boris Johnson has warned the public they are likely to need a third coronavirus vaccination in the autumn of this year.
It comes amid concerns the Oxford AstraZeneca jab may not be as effective against the new South African mutation of the virus. ‘We’re going to have to get used to vaccinating and then re-vaccinating in the autumn as we come to face these new variants,’ he told the Commons during Prime Minister’s Questions. He added new vaccines need to be developed which respond ‘at scale’ to new strains of Covid-19.
British Metro News
Joe Roberts Sunday 7 Feb 2021 12:08 pm
The Oxford/AstraZeneca vaccine offers only limited protection against mild disease caused by the South African variant of coronavirus, according to research.
But the British company said early data from the study, due to be published on Monday, has shown the jab can protect against severe disease caused by the mutation. The study, first reported by the Financial Times, into the E484K mutation involved some 2,000 people, most of whom were young and healthy. ‘We do believe our vaccine could protect against severe disease, as neutralising antibody activity is equivalent to that of other Covid-19 vaccines that have demonstrated activity against more severe disease, particularly when the dosing interval is optimised to eight to 12 weeks,’ a spokesman said..
British Metro News
Tom William Wednesday
10 Feb 2021 3:25 pm
Scientists advising the World Health Organisation have recommended the use of the Oxford AstraZeneca Covid vaccine in all adults. The benefits of the jab outweigh any risks and it should recommended for use, including in people aged 65 and older, a WHO panel said on Wednesday. It’s after the roll-out of the jab was suspended in some parts of the world because of concerns it may not be effective against the South African variant of Covid 19. Some countries have also chosen not to give the British-made vaccine to over 65s because it’s thought there isn’t enough evidence to show it’s effectiveness among older adults.
Credos to Prime-Minister Mia Mottley and her auspicious efforts..
@Tony February 10, 2021 3:24 PM “Special thanks to the Government and People of India, for their generous gift of 100,000 Jabs of AstraZeneca’s Covid – 19 Vaccine.”
Not so generous.
We seem to have forgotten that Barbados and other Caribbean countries BUY tens of millions of dollars worth of pharmaceuticals from India EVERY year and has done so for DECADES.
So if I buy $10,000 worth of groceries from my supermarket every year and if I have done so for 20 years or and he gives me a “free” calendar at Christmas that is not such a big deal after all.
I think that the merchant is sweetening me up in the hope that I will continue to do business with him.
But perhaps I am the most cynical person on BU.
Sarge actually I thought my line moved a bit but as I realized later a couple of people had died waiting and people had just stepped over them. Why has everything have to be racial your banking is slow no-matter what color you are. I dont know if the tellers think they are better than everyone else and can make them wait, ..they are just slow because they dont want to make a mistake…..or that is the regular speed of everyone… but you are slow and if it is anything out of the ordinary and a decision will have to be made well thats another story all together. ,
@ David February 10, 2021 2:15 PM
“Credit unions back off from bricks-and-mortar idea…”
+++++++++++++++++++++++++++++++++++++++++++++++++++++++
And that’s why it is archaic thinking and a retrograde step to even contemplate far less try to implement the idea of a “Post Office Bank” in the form envisioned by Hal Austin based on the existing Post Office ‘bricks and mortar’ presence in each parish.
Such a Post Office bank set up would have to be underwritten (both financially and administratively) by the GoB. A ‘costly’ thought that would be immediately thrown through the window- as a flight of fantasy- by the IMF the country’s current bankers of last resort and dictator to the MoF.
@lawson February 8, 2021 5:06 PM “What was explained to me a few tears ago waiting in the que at one of your banks, even though it says scotia it really isnt scotia canada its a separate entity. I wanted to complain about something further up the food chain in canada and coudnt they just use the name.”
I had a complaint, they ignored me. I complained to Scotia headquarters [I used to work at 34 King Street West, before Scotia occupied the spot] problem solved in less than 24 hours.
@ Cuhdear BajanFebruary 10, 2021 3:54 PM
“We seem to have forgotten that Barbados and other Caribbean countries BUY tens of millions of dollars worth of pharmaceuticals from India EVERY year and has done so for DECADES.”
+++++++++++++++++++++++++++++++++++++++
Now that the GoB has made a U-turn and jumped on the medicinal marijuana bandwagon the widespread-local but legalised- use of the recently baptised “Miraculous” bush (similar to Moses burning bush) should result in a tremendous savings in foreign exchange outflows previously burned up through those placebo-like synthetic imports from India which have turn Indian businessmen from millionaires in rupees to billionaires in US$ enough to ‘buy-up’ other industries and real estate in the UK, Western Europe and USA.
The idea of a post office bank in Barbados modeled on digital and telephone banking is not only wrong, it totally misunderstand the market place in which it operates. But it fits in with an obsession to punch above our weight.
Ordinary working people, including the elderly, mainly living from hand to mouth, do not need digital or telephone banking. All they need is a basic balance sheet retail bank to meet their everyday needs.
They do not need digital payments, investments in bitcoins, sharedealings nor in tiny Barbados they do not do much online shopping.
Further, digital and telephone banking are high risk and the banks do not accept responsibility for any frauds or other losses caused by the technology.
Anyone who has ever had their bank accounts raided by crooks know the problems they can have with the banks, including blaming people in the household for the theft.
Such people deal mainly, almost exclusively, in cash and are more than happy with ATMs, which are also underr threat. For non-cash transactions, they will have access to cheque books, standing orders, direct debit and credit and debit cards.
The truth is, the big retail banks want to move away from bricks-and-mortar banking because it is more economical to depend on the technology and all they see is the bottom line, not customer service.
They also make less out of basic accounts, which they find overbearing and time-consuming. With premier and advanced accounts, accountholders get services they do not normally need, such as ‘cheap’ life insurance, travel insurance, etc,all at a monthly price. In the UK it took the regulator to step in and stop those banks from ripping off their clients.
In Barbados, those long queues of people waiting to get access to their own money hardly suggests they are waiting for advanced retail banking.
What they need is good customer care, access to their money as quickly and easily as possible. A competent retail balance sheet will will provide all those services, along with trust and confidence.
It is a market waiting to be exploited – and it is being watched by small bankers from the UK who holiday every year in Barbados.
I know. Years ago I introduced one such person to InvestBarbados.
(Quote):
In Barbados, those long queues of people waiting to get access to their own money hardly suggests they are waiting for advanced retail banking.
What they need is good customer care, access to their money as quickly and easily as possible. A competent retail balance sheet will will provide all those services, along with trust and confidence.
It is a market waiting to be exploited – and it is being watched by small bankers from the UK who holiday every year in Barbados.
I know. Years ago I introduced one such person to InvestBarbados. (Unquote).
++++++++++++++++++++++++++++++++++++++++++++++
You can continue to perform the devil’s advocate role of the ‘lawyering Luddite’ for the traditional model of banking as long as you like.
But you can also invest your last crypto coin that ‘retail’ banking in Bim within the next decade will take on a holographic spectre as can be seen on retail banking outlet on any High street in the UK.
That is, devoid of tellers and ‘old-fashioned’ over-the-counter services which result in the queues still prevalent in Barbadoes.
What retail-banking service users would be confronted by is a small team of human advisors to point you to either a ‘bank’ of sophisticated and very user-friendly ATMs or to a private area where you can log on to on-line banking or ‘default’ to the traditional telephone option.
BTW, you can tell your ‘Investor magnate’ friend that InvestBarbados is not mandated with the task of inviting FDI in a dying industry and where the creation of white-collar jobs is like spinning top in mud.
Maybe you can get him to join up with Barclays (which is closing down branches by the day) to return to the English-speaking Lesser Antilles where billions in ‘sterling’ profits were extracted in the past and as part of the British role on the liability side of the reparations balance sheet of commercial banking.
Cuhdear Bajan February 10, 2021 3:45 PM
“So if I buy $10,000 worth of groceries from my supermarket every year and if I have done so for 20 years or and he gives me a “free” calendar at Christmas that is not such a big deal after all. “
However, your response will be “Thank You” Mr. Hill?
It was of the opinion that Barbados merchants retain large business transactions/deals with China 🇨🇳 . India ???
Are you referring to the Deighton Mottley Khaki made in India that was given to the under privileged school Kids???
That Khaki was bought by the British and traded to BDS. It wasn’t a direct transaction with India. However, I stand to be enlightened on the subject..
Tony what she is not saying is that besides a calendar, the supermarket is also given people the opportunity to dispose of that under the table income …screw the calendar If not for restaurants and grocery stores how are you going to get use of cash without the govt on your tail, buy a new car, bank it, pay bills LOL . That money that you have been keeping , from a relative visiting with ypu, … , cash sales etc there are not to many things to do with it maybe repairs on house car hookers etc but then the next guy is stuck with it. Trying to get it off the island is an option didnt work out for donville so well. No groceries are the way to go for the small fry they say.
Hal AustinFebruary 10, 2021 4:37 PM
I am with you on the post office bank. Most people in Barbados do not have huge funds to invest and some do not even know how to use a keyboard.
The digital banking can be done for the professionals and well to do, but the post office retail bank is clearly needed.
Plus, this bank needs to do small loans for agricultural equipment, small manufacturing and vans etc for trade. The large banks have no use for the average person, they cater to the weight punchers as you call it.
When the world is asking if the government needs to pay a fixed wage for people who cannot a job, as a matter of course, Barbados needs to be seeing how to keep its people fully employed in agriculture, small manufacturing, computer programming for the academically inclined (catering internationally) , medicine and nursing, etc.
That is where this is going. Going back to skill jobs and skill jobs that matter for tomorrow. The only office work that matters, en masse, going forward is software programming, computer will do all of the rest. But even programming is not really en masse, it needs excellent programmers, which the island can develop.
One more thing on the retail bank. The credit finance game is in Barbados strong now. Put it on hire purchase or credit card is the call. All with exorbitant interest rates.
It would be better to go to Barbados Postal Bank and get a small loan for that new sewing machine, to be paid back over a year, at an interest rate of 12% instead of 30%.
Maybe some might not want this. Note which companies have become financial institutions instead of retail stores.
@Crusoe
Is there room for a profitable PO bank as you have described given the direction of the market?
@ Crusoe
You are absolutely right. What is also missing is sound financial education, which can be taught in schools, as part of maths, on television or in the aimless newspapers.
We urgently need a consumer protection organisation, which will not only fight for consumer rights, but will embark on a mass financial education programme.
Why can’t the unions and community groups use empty school halls in the evenings to teach people about basic finance?
Crusoe February 11, 2021 9:19 AM #: “Note which companies have become financial institutions instead of retail stores.”
@ Crusoe
There is a particular company in Barbados that is registered as a financial institution and also offers loan financing through its subsidiary retail store.
Courts Artax?
Aye, David.
To expand on the point to Cruise, there maybe a demand by the senior segment for financial services defined by numbers, however, would such an operation be profitable? The blogmaster assumes such an entity is projected to be profitable and fit for purpose.
@ David
That establishment, along with some other financial institutions (Carilend Ltd., FastCash, TravelCash) offer short term loans at high interest rates, for which the qualifying requirements are not as stringent as those of commercial banks and companies such as Consolidated Finance or Signia Globe Finance.
And, there is a high demand for those types of loans.
@Atax
There is a reason why interest rate is high, because of the associated risk.
Bankers confident systems will detect laundering – Bankers confident systems will detect laundering: https://barbadostoday.bb/2021/02/11/bankers-confident-systems-will-detect-laundering/
‘Dirty’ money alert – ‘Dirty’ money alert: https://barbadostoday.bb/2021/02/11/dirty-money-alert/
An urgent warning has been issued to local attorneys-at-law, against being lured into a possible money laundering scheme, involving “large sums” of United States dollars from overseas “clients”.
https://barbadostoday.bb/2021/02/11/dirty-money-alert/
LOL LOL LOL yes that was how big fry do it no calendar
“British television channel BBC World News has been barred from airing in China, the National Radio and Television Administration said on Friday, a week after Britain’s media regulator revoked Chinese state television’s broadcast licence.
In a statement issued on the stroke of the Lunar New Year, the administration said an investigation found BBC World News’ China-related reports had “seriously violated” regulations, including that news should be “truthful and fair,” had harmed China’s national interests and undermined national unity.(quote)
Some form of digital banking IS the future. While many of the established brick and mortar banks, have opted to sit on the fence, and dangle a leg over both the digital and traditional sides, one is growing, while the other dies as its users pass on.
My children last wrote a cheque when forced to do so by their 65+ year old landlords at University; sign a lease and hand over a slew of post dated cheques. Today, they don’t even know where their Bank is. It’s on their phone.
@ Northern Observer
You are missing the point. I am talking about basic banking for moderately paid people with no interest in investments or sophisticated banking.
There are 44000 people aged over 75 in Barbados and most, like people in other countries, are unlikely to have an interest in digital banking.
Digital payments are fine, but three, four, five years later when you want a record what do you do? Of course you can walk in to your bank and ask for a print out, but to do that in Barbados will be another charge.
Why do I need a bank account that offers travel, life and motor insurance, investments, that sends me constant nonsense about loans?
Not just the state-funded BBC, every night CNN runs a lot of anti-China propaganda, behind a shadow of anti-Trumpian angst..
Suspect that ‘dirty money alert’ is describing the set-up for a scam and not money laundering. One-smart will die at two-smart door.
Hopefully our lawyers are also above believing in a billionaire relative in Nigeria
@HA
those “44000 people aged over 75” will be “20,000 people aged over 85” in 10 years (guesstimate) You are correct, those with established ways, don’t wish (cannot?) to change and just want an economical way to keep doing as they always have. And 15 years on, there will be 6,000 of them? Not a growing future, rather servicing an ageing population in a manner to which they are accustomed. By dangling legs on both sides of the wall, this is what many traditional banks are doing. A non-digital bank set up via a post office (another dwindling bricks and mortar place) is a stop gap measure. I must admit I haven’t mailed anything in 6yrs+. I email cards, pay online, and if I have a package I can’t deliver myself, I call one of the local couriers. In fact, many a Canadian post office has morphed into a section in a local store, usually drug or hardware. They simply cannot afford the real estate, and the employees, for the revenue they generate. All my bills are sent via e-mail, or a notification ‘it is ready’ at the providers website. Several today are notifications by text/whatsapp.
The digital accounts are far more ‘bare minimum’ than the bricks and mortar. But like the traditional banks, if I need a hard copy of a transaction past (whatever time period it is free), there is a charge.
Like the delivery crews, who notify you digitally, via a picture of the delivery wherever it was to be delivered, I have got in the habit of snapping a picture of every paper bill/receipt etc, which I monthly sort into a permanent file (on my cloud lol) My kids do it on their phones, I am not that accomplished!!!
For the blogmaster from behind a paywall
“Governments around the world have turned on the taps to deal with the pandemic, so far spending about US$14-trillion to help their citizens weather the economic consequences of COVID-19. Much of this spending has been financed by new debt that has gone on to be purchased by central banks, in what has seemed like a painless process; even the most indebted countries, such as Italy, have had no trouble borrowing money, thanks to expansive monetary policies that have seen central banks buy up government bonds soon after they hit the market.
More than one-third of all bonds issued by the government of Canada are now owned by the Bank of Canada, up from one-fifth before the pandemic. Over all, the central bank’s holdings of federal bonds have surged to $320-billion, from about $120-billion before it committed to weekly bond purchases last March, under a program known as quantitative easing, or QE. Those purchases have made it exceptionally easy for Ottawa to borrow record amounts of money.
The story is much the same in the United States and Europe, where the central banks have also been hoovering up government bonds. The U.S. Federal Reserve has increased its holdings of Treasury bonds and other government debt instruments by US$2.7-trillion since last March. The European Central Bank has bought up more than €800-billion ($1.24-trillion) since the pandemic began, bringing its total holdings of government debt issued by euro zone countries to about €2.5-trillion, or around 25 per cent of all such debt.
In theory, these central bank bond-buying programs are supposed to be only temporary. Bank of Canada officials have insisted that the federal government must reimburse it when the bonds it holds come due. The dollars created out of thin air would then be cancelled, preventing a permanent increase in the money supply that could lead to higher inflation. In reality, it may not work that way.
To retire the debt held by the central bank, the federal government would need to borrow from investors on the open market. Indeed, without dramatically raising taxes or cutting spending, Ottawa is expected to run large deficits for years to come, requiring it to borrow to finance new spending and to roll over existing debt.
More than 100 European economists on the left insist they have a better idea. Instead of forcing euro zone governments to repay the bonds held by the ECB, the central bank should just cancel them. That’s right – they say the ECB should wipe the slate clean so that governments can emerge from the pandemic freed of debt obligations in order to pursue a green recovery.
“Our solution is therefore simple: Let’s make a deal between the European states and the ECB,” the group that includes noted French economist Thomas Piketty wrote last week in an op-ed published in several leading European newspapers. “Let it cancel the debts that it holds (or transform them into perpetual debts with 0-per-cent interest rate) and let the European states commit the same amount to a widespread social and ecological recovery plan.”
The group has found plenty of support among left-leaning European politicians. Its suggestions echo those Riccardo Fraccaro, an aide to former Italian prime minister Giuseppe Conte, who in November called on the ECB to cancel “sovereign bonds bought during the pandemic or perpetually [extend] their maturity.” Italy’s sovereign debt is set to surpass 160 per cent of gross domestic product this year, but its government has been able to borrow at interest rates of just 0.6 per cent, largely because of the ECB’s massive bond purchases.
ECB president Christine Lagarde wasted no time shooting down Prof. Piketty’s idea, describing it as “inconceivable.” In an interview with France’s Journal du Dimanche, she said cancelling the debt “would be in violation of the [European Union] treaty which strictly prohibits monetary financing.”
In their op-ed, however, Prof. Piketty and his co-signatories argued that some monetary purists argued that QE also violated EU treaties when the ECB began its bond-buying program more than five years ago. “Let us not be distracted by legal fallacies; in the end only political will matters,” they wrote. “And history has shown countless times that petty legal issues fade away in front of robust political deals.”
Similar arguments have emerged on this side of the Atlantic as progressive economists worry that pandemic debts will hamstring governments in Canada and the United States for years to come. After all, debt cancellation sounds so much more palatable than austerity, doesn’t it?
QE was always bound to lead us to this place. The everlasting appeal of the free lunch lives on. But sooner or later, someone – or some generation – has to foot the bill.
@NO
Scary.
#QE
@ Northern Observer February 11, 2021 2:46 PM
We must view the proposal of a resuscitated Post Office bank in its previous over-the-counter incarnation as a mere financially-impossible pipedream similar to a former Bajan politician’s mad dream of building a ‘second’ international airport in Moon Town to be called the Denis Kellman International.
The Bajan government cannot even collect on a quarterly basis the straightforward VAT due to the Treasury far less own and manage an old-fashioned politically blighted bank in a growingly competitive digital world of finance, banking and commerce.
People, do you know how many working people, even younger age, do not have an email address let alone a digitally accessed account? Many workers rely on cash and a traditional bank account.
They, rightfully, also see digital money as an easy segway to credit loans that they cannot repay.
30% APR.
That is why the bog banks do not want a traditional bank to compete against. If you can get a loan for your two drive mowers, or five sewing machines, or new washing machines, from the PO bank at 12%, why get one from a credit institution asking for 20%+ or more APR. And got forbid you get it on the credit card. 30% APR.
That is why a PO bank, well run, will work.
Credit is the new money churner for some. New fangled money lenders.
@NorthernObserver
We live in interesting times but what will post Covid financial/ capital landscape look like?
@Crusoe
Those who do not have email addresses or … innovate products will be created to serve them, bricks and mortar is on itâs what out.
@ David,
Maybe this is a segway to the post Covid economy. This will likely lean to speculation and a view of where we are going, but could be worth considering at this time.
@ Northern
You are still missing the point. Those who want digital banking with its bits and pieces will go to digital, those who want basic banking will go to basic banking. It is a matter of choice.
Every time I go in to my bank they want me to go digital or mobile and I repeat, over and over again, no. I am not alone. Every day there is a queue of people waiting to go in to the bank for some service, and this is one of the biggest retail banks in Europe.
It was the move towards digital that opened the space for what we call challenger banks, of which Metro Bank is the best known, it led to the re-birth of the TSB bank and the strengthening of the building societies.
Ore, in typical Bajan style, we can always punch above our weight and be at the cutting edge of technological banking.
Just look at Republic, the most incompetent bank I have ever had to deal with, so much so that I had to close a small account I had with them. And they fabricate. The last letter I got from them was in the Spring and was dated the previous October.
They did that because they wanted to declare my account dormant. Talk to Bajans in the UK about problems with dormant accounts in Barbados. It is a rip off, which they blame on the central bank.
Ordinary people want ordinary banking.
Who will pay for it?
@ Crusoe February 11, 2021 5:35 PM
What you are proposing is altruistic and more ‘socialist’ in outlook than the Bajan economy is being prepped to adopt under the IMF-directed BERT & BEST programmes.
Here is what the policymakers under instruction from the IMF would say to such a ‘petty-cash’ proposal:
‘Let them join an existing cooperative credit union providing such small-time services.’
The commercial banking system of the future- whether the players are private or government-sponsored or local or international- ‘small’ accounts, whether personal or business, are in essence of mere nuisance value and do not add to the shareholders’ bottom line and CEO’s bonuses.
@Crusoe
look around, most have phones. They can learn. That is why I said, the one leg on each side of the fence, is the model being followed. I question how much profit there is, in the PO Bank model. And how long the cash and minimal digital interface will continue. I still say it is a ‘stop-gap’ measure, which if its in public hands, has the potential to boondoggle into another suckwell.
@Blogmaster
The market certainly doesn’t know!! The massive public financing in many places is nothing more than a band-aid, it is when that dressing is removed, we will see who has healed and can function, and who needs an amputation or worse. For Barbados, the acid test will be employment.
The size of the entire Bajan economy is such t hat it can be called an nuisance. There are a handful of really wealthy people in Barbados, apart from the gangster Irish on the West Coast.
Remember a Bds$1m is only about £35000, or the price of a terrace house in London. Most returnees are Bajan millionaires. Some have pensions bigger than the salaries of government lawyers.
We are a poor third world island, and not the crap people talk about being first world. There is nothing wrong with a credit union bank. Try it and see.
Stop talking about profit in a post office bank and talk about service. We do not all have mobile phones. I have never owned one. When the FT Group tried to get me to take a company phone I kept refusing.
Who will pay for the service.
@Crusoe
Put it on hire purchase or credit card is the call. All with exorbitant interest rates.
+++++++
So what else is new? Hire purchase was rampant in Barbados for more than 40 years, what has changed is that there are more ways to access credit. Back then people were purchasing radiograms, now its big screen TV’s. The Canadian banks also provided credit for car loans and other consumer products with registered liens via Bill of Sales etc. After noticing the success of those banks other FI’s. e.g. Barclays and the American Banks in Barbados at the time jumped on the bandwagon.
@HA
not sure, any of us are missing the point. IF, said services can be provided in such a manner where break even is the minimum result, fine. It’s a declining market, guaranteed. Remember, “we doan wuk fah free nah more”. Maybe negative interest rates may be the impetus needed for change.
Pension cheques delayed – Pension cheques delayed: https://barbadostoday.bb/2021/02/11/pension-cheques-delayed/
@Northern
Hal does have a point. The elephant in the room is that the large banks do not see any profit in the small man business. Man, you and I both know that if they could belt it out of here tomorrow, except for the IBC’s and wealth people, they would bolt.
But cannot have one without the other. That is all that is keeping them in it. So, not much profit in it anyway. Fooling ourselves otherwise. But the service is needed.
And it can spring more than the break even, by competing against those HP and credit card interest rates.
If those companies see profits in that area, surely the PO bank can compete there? The trick is to keep overheads low and fraud down.
You anticipate a PO bank as a government agency can achieve what you have stated? Where is the example it is possible? Bear in mind Barbados is a failed state to coin a phrase. Let us see the business case before we assume this type of operation is viable.
DavidFebruary 12, 2021 3:25 AM
I get your point. But really the question may not be whether it should exist, the question is whether there is truly an alternative for this socioeconomic band.
Hint: post-Covid economy.
@Crusoe
As stated a solution will emerge but it will not be bricks and mortar.
@ David February 12, 2021 3:34 AM
“@Crusoe
As stated a solution will emerge but it will not be bricks and mortar.”
+++++++++++++++++++++++++++++++++++++++++++++++
What Crusoe is reminiscing about are those halcyon’ financial’ days when the Barbados [Penny] Savings bank- operating out of the precincts and possibly under the aegis of the Barbados GPO- was there for the ‘ordinary’ Bajans who were deprived ‘easy’ access to the ‘High Street’ banks on the then upmarket Broad Street dominated by the likes of BarclaysBank DCO, RBC, CIBC, the Bank of Nova Scotia and by the later arrival of the American banks like Chase Manhattan and Bank of America.
What the proposed reinvented Post Office bank would be mandated to do is what the Barbados National Bank was established by the Tom Adams BLP administration to achieve proving that there is nothing new under the Bajan commercial banking sun and that what goes around always comes around in whatever technological incarnation.
Still, the constant question (of change) remains:
Who or what would be footing the bill for this rebirth of another commercial SOE the likes of which the IMF would like to banish from the Bajan economic landscape.
@ Crusoe
It is very difficult to discuss any subject seriously when some people just want cheap laughs. Those cash-rich households who like modernity will find digital banks interesting and they will be prepared to accept the risk of having their accounts hacked.
For ordinary poor people basic banking is all they need, and that goes for the majority of Barbadians.
Typical, you are asked hard questions and you resort to your usual pejorative as and disparaging position. The question is- how will this segment whose demand is transactional with a low borrowing appetite support a PO Bank operating as a profit centre. What are the revenue drivers.
You do not understand what you are talking about and are in danger of misleading the readers. We are going round and round in circles. If you want a revenue driver get a taxi.
@Crusoe
The GoB has been able to legislate Banks to keep an increasing amount of their deposits with the CBB, they have torn apart legislation regarding interest rates, and we think they cannot legislate the terms of a basic bank account?
In regards to basic banking, when I speak of profit, I refer to a minimum ‘covering of costs’. Not ‘making lots of money’
The basic challenge is that retail banks/credit unions and government have had an adversarial relationship for years. For what is a declining customer base (those who are incapable or refuse to use technology for whatever reason), it would seem the services required can be legislated via existing entities, whether retail banks or credit unions. And since age would appear to be a major factor to who requires this level of ‘service’, addressing costs is made easier. I mean we are just discussing basic safekeeping of money.
@ Crusoe
@Northern is making a bold claim about legislating for basic bank accounts. Where is his evidence. The UK has legislated, in fact the regulator has enforced, a basic bank account.
It was based on all the false claims we are now seeing on BU, such as profitability and revenue streams; The emphasis was on SERVICE and the need to provide a competent service for a large number of people, who, without such service, would have been marginalised.
‘Minimum’ costs are covered by the basic bank charges. First , the monies deposited would be invested since it is unlikely there will be a run on the bank; then there are the principles of lending: interest, if any, on a current account will be less than the interest on loans, such as the base rate plus, that is basic banking.
As I have said Post Office bank will provide credit cards, debit cards, etc, all those will include so-called revenue-making charges. All these carry fees.
Banks are not free, the big difference will be the quality of service, treating people as if their are important and as if it is their money they want to access.
I am not sure how retail banking works in Canada, but for years most leading banks have been compelling people to shift to digital, mobile and telephone banking, not out of the interest of the account holders, but because it is convenient for the banks. They did so until the regulator stepped in. Now all high street banks MUST offer a basic bank account.
Wherever there has been an alternative, such as challenger banks (ie Metro) people have flooded to them. Of course, some customers will prefer digital banking for its convenience, while others will prefer basic banking. What is wrong with giving Barbadians a choice?
I am not sure what @Northern means by an adversarial relationship. Maybe he can explain that. One minute he is saying the government (ie GoB) cannot legislate a basic bank account, a misunderstanding of parliament’s legislative powers, then he claims they can legislate via existing entities. What does this mean?
Age is an important factor not a MAJOR factor; the influential factor is low pay, poverty. The basic discussion is about providing a service for low paid and marginalised people, especially at a time when most people have their wages paid in to their bank accounts.
@HA
I don’t know what you are on about. I said from the get go, that Banks in Canada (only because they dominate the Barbadian landscape) have one leg of each side of the fence. That fence is the line between digital banking and traditional bricks and mortar banking.
Further, the GoB CAN legislate whatever they choose. This includes the fees and services provided. “they can legislate via existing entities”, means, the GoB can legislate ‘existing entities’ (retail banks and credit unions). You don’t need some new entity. If somebody thinks/feels that a new entity will provide better ‘service’, then by all means open one.
I’m not investing in it, but you are free to do so.
You can split the hair strand between important and major.
@ Northern
There is no hair splitting. The proposal was for a Post Office bank in Barbados providing a basic balance sheet service.
There was nothing about Canadian banking from you, that was your intervention. Most high street banks do offer digital and bricks and mortar. Plse re-read what I said. I mentioned the challenger banks as providers for low-paid and marginalised people.
Again you are the one who introduced the idea that government cannot legislate the terms of a basic bank account. I said yes they can and, in the case of the UK, the regulator did.
I also raised the point that to suggest government cannot legislate for a basic bank account is to misunderstand parliamentary democracy. They do not have to legislate via existing entities, they want a new model.
Your original argument was about profits, I said forget profits and think of service. There will be digital, mobile and telephone banks, but there is also space for a basic balance sheet bank, offering basic current and savings accounts, without any bells and whistles.
That is what I believe Barbados urgently needs. Such bans exist all over the world.
Source: Nation
Royal Bank dumping some EC branches.
http://www.loopslu.com/content/eccb-approves-sale-royal-bank-canada
I have not heard from Adrian in a long time. The forecasted reopening of the tourist industry appears to be a pipe dream.
Here are two other individuals who may have become surplus to requirements in an industry which shows no signs of revival.
April the sixth and we have had several hours of snow and the temperature peaked at 1-2 degrees. It’s suppose to be summer here in Blighty!
https://www.nationnews.com/2021/04/06/two-tourism-executives-resign/
Peach and Quiet reawakens,
https://barbadostoday.bb/2022/01/19/peach-and-quiet-to-reopen-under-new-ownership/