Clearing Banks Association, Central Bank to meet with Foulkes on bank fees
The Clearing Banks Association and The Central Bank of The Bahamas have agreed to meet with Minister of Labour Dion Foulkes in his capacity as the overseer of the Consumer Affairs Division, after numerous complaints have come in from the “general public with respect to the increases in some commercial banks’ services fees and charges”.
A press statement issued by the Ministry of Labour yesterday explained that it has received “numerous reports and complaints” about the fees and charges. Guardian Business also reported this week that complaints have been received by the Bahamas Chamber of Commerce and Employers’ Confederation (BCCEC), which is also preparing to meet with the Clearing Banks Association to discuss what BCCEC CEO Edison Sumner called “anxiety” over the banking fees in the country.
The Ministry of Labour said these complaints range from the banks’ increases in fees associated with check cashing, to increases in credit card late payment fees.
“The Clearing Banks Association and The Central Bank of The Bahamas have agreed to meetings to discuss these issues next week (October 19th),” the press statement stated.
“The chairpersons and members of the three consumer protection agencies will also participate in the discussions, along with members of the Tripartite Council. They include Philip Beneby of the Consumer Protection Commission; Synida Dorsett of the Price Control Commission and Pauline Curry of the Bahamas Bureau of Standards and Quality.”
This intervention comes as banking professionals predict that the fees will only continue to increase in the future.
Former Scotiabank Managing Director Barry Malcolm told Guardian Business recently that Bahamians are likely to see their banking experience become more expensive over the next few years. He revealed, however, that there are also likely to be alternative banking solutions available to Bahamians very soon that will compete with the traditional banking system.
Malcolm told this paper that the international commercial banks have been going through an evolution in The Bahamas to remain competitive and profitable. This evolution, he noted, has required the banks, which began to tighten up on their allocation of loans due to increasing arrears, to increase their fees in order to remain profitable.
“They have had to re-examine their model for operating and being profitable,” said Malcolm.
“Within the countries of the Caribbean, they have made some necessary adjustments; they have reduced their footprint.”
In The Bahamas, Scotiabank and Royal Bank of Canada (RBC) have reduced their branches country-wide.
“They have reduced their focus to serve parts of the country where they can be most profitable,” Malcolm said. “They have had to find different ways to increase revenue.”
Bahamians have become incensed over the amount of fees they are charged to cash checks and deposit money at automated teller machines.
Malcolm said these fees are a natural evolution for the banks that have to appease their shareholders at the end of the day, meaning they have an obligation to be profitable.