Consumer Protection Commission (CPC) Research and Training Manager Lavade Darling, said his agency is working with The Central Bank of The Bahamas to codify merchant services agreements in legislation, as moral suasion thus far has not deterred some merchants from charging extra fees to customers for choosing to transact with debit or credit cards.
“The merchant services agreements for using a credit card stipulates that you’re not supposed to have a minimum purchase and you are not supposed to be charged a convenience fee to be using your debt or credit card. That is a matter of major concern for us. We had a meeting recently with the Central Bank to speak about that, and one of the things that came out of that meeting was that they would be introducing legislation to enforce the merchant services agreement. Because moral suasion is not working,” Darling said during an appearance at the OPM’s weekly press briefing yesterday.
“These merchants are aware of the terms of their merchant services agreement. And besides that the government of The Bahamas has said they want us to move toward cashless, so using your credit or debit card should not be more expensive than using cash and it goes against the stated policy objectives of the government of The Bahamas.”
Darling said in addition to a push for legislative changes, his department will soon launch a financial literacy campaign targeting small and medium-sized enterprises (SMEs) about how they can lower their costs with digital transactions.
“You would have heard recently with the petroleum dealers that one of their major costs was actually the fees that they incur from debit and credit card payments, so we will be looking at how we can lower those costs. The merchant discount rate should not be the same for a credit or debit card transaction,” he said.
“So if your bank is charging you the same fee to process a credit card or a debit card, that should not be because a debit card payment is not as complicated to process as a credit card payment. So the fees that your bank charges you should be less than a credit card. So that’s one of the areas we are concerned about and we are addressing on behalf of the Bahamian consumer. You should see some traction in that area in very short order.”
Other major areas of concern for the CPC involve the local timeshare industry, complaints of fraud in some stores in Downtown Nassau, and the funeral services industry.
“We do have some concerns with timeshares that have come to us over the years. We have a lot of tourists and that’s a concern because tourism is our number one industry. Persons basically purchase a timeshare and they want out of it. And the act provides the conditions under which you can get out of your timeshare. The problem is that the timeshare operators are not giving them the opportunity to get out of their timeshares, so that’s a major concern for us,” Darling said.
“There are certain stores on Bay Street that are targeting tourists, basically cruise ship passengers. They would purchase an item for “x” amount of dollars, they would get a free item and basically when these cruise passengers get back to their homes they would find that they were charged $10,000 or $15,000 for an item that really should have cost what they agreed to purchase. That is a major concern for us. We are working with the other relevant agencies to address that. It’s not something we can address totally on our own. Tourism is aware and we are working with them to resolve these types of issues.”
Darling continued, “The funeral service industry is unregulated. It’s unregulated because the legislation that speaks to it is the Burial Grounds Act of 1869. It’s an anachronism, it shouldn’t exist in 2023. It’s a problem. I’ve had my staff researching this area for basically most of the year. We have been looking at legislation in other countries to see how they deal with complaints against cemeteries and funeral homes, because in The Bahamas we don’t have it as yet. So those matters would fall under CPC, therefore we want to strengthen our legislation to be able to deal with these types of complaints.”
Darling said the solution to many of these complaints can be addressed if the CPC had stronger legislation.
“In that regard I’d like to say that it’s unfortunate, but we’ve had draft amendments to our legislation from 2018, so we are appealing to the AG and the minister to assist us in getting that legislation amended. We don’t even have regulations,” he said.
