The Central Bank of Barbados is preparing to introduce an instant payments system.
Governor Dr Kevin Greenidge expects it will help to lower the cost of financial transactions while increasing the speed with which they are conducted.
The monetary authority is partnering with the World Bank on the Barbados Payments System Modernisation Project and yesterday a related regional instant payments workshop started at the Courtney Blackman Grande Salle, Tom Adams Financial Centre, The City.
Greenidge called the two-day event “a meeting of the minds as we advance our domestic payment system infrastructure to be more inclusive, to be more efficient and to be more resilient”.
“This workshop comes at a critical juncture at the Central Bank of Barbados, as we onboard our national instant payment systems here at the Central Bank, which we all know have the power to catalyse the entire payments landscape,” he said.
“Rolling out this architecture, rolling out this national payment system, will integrate our payments network. It will promote real-time settlement for retail, for wholesale, for Government, e-government, for the security systems.
“It will also empower micro and mediumsized businesses, and it will also support greater system transparency, security, standardisation and interoperability. We expect to see a lowering of transaction costs, operating costs, settlement times, all the while promoting financial inclusion,” the Governor noted.
Greenidge said the Central Bank’s responsibility was to “provide a payment system as a public good where it will not only be based on innovation, but will also benefit all citizens and the financial sector and economy as a whole”.
Solid foundation
“So we at the bank will embark on a journey of updating and strengthening our payment system with this strong emphasis on making sure we have the state-of-the-art [systems]. We will place strong emphasis on making sure we have best international standards,” he said.
“We expect that we will achieve interoperability, we will be able to build a solid foundation, one of robust governance and a strong cyber mechanism. We are very eager to learn from our regional partners’ experience.
“Some of us are further ahead and some are along different paths of this journey, and we expect as we move forward, to align ourselves with global best practices in shaping our ecosystem.”
He added: “We exist in a world where consumers and businesses expect – and they should expect – instantaneous results in every aspect of their individual life. They should expect the payment
system to be up to scratch and not lagging behind. It is our view that an efficient, fast and effective payment system is not a luxury. It should be standard. It should be expected.
Regional trade
“The faster payment system is not about technology, it’s about creating a space – systems that everyone can benefit from, and that can serve everyone – that will make our financial systems and our economies more agile, our businesses more competitive and our societies more inclusive.
“Ultimately, our aim is to make faster payment systems across the entire region that are linked and provide even faster regional trade and effective transaction, so that we continue to push towards the goal of a seamless Caribbean economy, single market economy.”
Greenidge said workshop participants would discuss a number of matters related to instant payments, including design principles, governance models, implementation strategies, operational challenges, cybersecurity and cross-border payments.
Federico Baechli, World Bank country representative for Barbados, said the institution was 100 per cent behind instant payments and fast payments.
“As the region’s countries continue to develop their economies, we cannot have payments slowing things down. Instead, payments should be at the vanguard so it is the last thing an entrepreneur has to worry about in their business,” he told participants.
“In fact, faster payments should be facilitating the creation of new and exciting jobs, an agenda item that is high on the World Bank’s view, and it’s big on the global agenda.
“While some [people] may like to stand in lines at ATMs and in bank branches and to write cheques, I personally do not. Time is money, and I am so pleased to see the Caribbean is saying the time is now to chart a new course on fast payments,” Baechli said.
“We are also seeing how critical fast digital payments are during emergency responses, making cash transfers, making Government payments, paying school fees [and so on].”
(SC)
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