BiMPay could bring economic benefits to Barbados, but its adoption could also present important risks and challenges.
That is the crux of an International Monetary Fund (IMF) staff assessment of the national instant payment system (IPS) prepared before it went live on June 12.
The payment rail, which since being implemented has faced some challenges resulting in the late payment of some salaries and pensions, was examined by IMF experts as part of the international financial institution’s latest Article IV consultation.
The analysis BiMPay: Potential Benefits And Costs Of Barbados’ New Instant Payment System said that the experience of other countries “suggests that BiMPay has the potential to reduce transaction costs and increase efficiency; improve financial social inclusion and reduce informality; and spur financial development and institutional and regulatory reform”.
It added, however, that “the transition can also present challenges to adoption, regulation and supervision, privacy, and governance”.
The assessment, which was published in the 2026 Barbados Article IV report, noted that “the authorities are monitoring technical, financial and cybersecurity risks as the new system is rolled out”.
Aims of system
“BiMPay aims to foster more efficient, interoperable, and consumer-friendly payments, generating positive spillovers for the economy,” the IMF team noted.
“The objective of BiMPay is to increase the speed and convenience of domestic payments, with a view to fostering financial inclusion, helping business operations, for example, cash flow management, record keeping, payroll management, invoicing, encouraging financial technology innovations, and facilitating Government payments to citizens, reducing informal employment.
“It also aims to strengthen the [Central Bank’s] regulatory authority over payment systems, clearing, and settlement services, and to boost economic activity.”
The report observed that “while digital payments have grown in Barbados, surpassing traditional payment methods in 2019, the use of cash remains prevalent and is still the only option for many small businesses, referencing information from the Central Bank”. “While mandatory participation by core financial institutions aims to ensure sufficient BiMPay coverage from its launch, increasing financial inclusion will be key for operators without a bank or credit union account,” it added.
The IMF staff said that based on the experience of 120 countries which had introduced IPSs, BiMPay could bring economic benefits.
“They enable instant transmission of payment messages and immediate availability of funds 24 hours a day, seven days a week, facilitating payments for households and firms,” the IMF staff said.
“Research suggests that IPSs can raise household incomes, small business activity, and credit supply. IPSs also generate data that allow users to access financial services like credit provision.
“As a lower cost payment option, they can raise savings in financial institutions and foster competition and interoperability, which is relevant to Barbados, given low penetration of payment cards and financial inclusion.”
The IMF report said nevertheless that “the adoption of BiMPay could also present important risks and challenges”.
The report elaborated on this, stating: “The introduction of an IPS raises questions about the supervision of real-time activity; liquidity assurances for participants; consistency of capital regulations; testing of crisis management arrangements; and mitigation of anti-money laundering/combatting the financing of terrorism.
“IPS adoption can also be constrained by uneven mobile and Internet penetration; uncertain takeup by the public, given that existing payments are convenient and have the advantage of anonymity; difficulties in reaching individuals without stable employment and access to a bank or credit union account; and low financial and digital literacy, especially for less educated users.”
Early evidence
The report also pointed to early evidence which indicated that “the success and drivers of IPS adoption can vary across countries”.
“Technical characteristics play a key role, notably temporary offline functionality requiring central bank capabilities, strong supervision and monitoring, and simplicity of use,” the IMF staff said.
“Importantly, the Central Bank needs to clearly establish its role in regulating and overseeing the IPS on a sound legal basis, while carefully designed state intervention in the IPS can support competition and innovation, address coordination issues, and ensure the security and accessibility of the system.
“For example, in Brazil, important factors in the successful adoption of Pix, an IPS owned, operated, and maintained by the central bank, included mandatory participation of larger payment providers, active stakeholder engagement, a user-centric approach, low fees, and emphasis on security.” (SC)
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