By FAY SIMMONS

Tribune Business Reporter

jsimmons@tribunemedia.net

The Central Bank yesterday reiterated its ambition to ensure Bahamian commercial banks provide a ‘basic bank account’ that would cap or eliminate fees for lower-income individuals.

John Rolle, its Governor, said the regulator is working to complete the regulatory framework for such an account as a targeted measure to address the cost of banking services for persons of lower economic means.

Speaking at the Central Bank Digital Currency conference, he added that the initiative is a key element of ongoing efforts to make the financial system more accessible and affordable. “Most important result for us in the near term is going to be to complete the work on having a basic bank account,” Mr Rolle added.

“The basic bank account is a facility that would have protections around what sort of charges are passed on to the users of the facilities, whether it is for withdrawals or making of payments, and the intent there is to target a product like that to persons who have less economic means than the average persons in the population.”

Mr Rolle said such an account would be structured to prevent persons from being excluded from formal banking activities due to high service charges. 

“As we try to get to a better place in terms of the fee structure in the financial system, you do not want people to be forced to exclude themselves from taking advantage of making use of financial services because they can’t afford it, and it’s making the difference between whether they have sufficient groceries or not at the end of the month,” said Mr Rolle.

While the income threshold for qualifying has not yet been determined, he added that customers who meet the criteria will be given clear information about the account’s terms, costs and protections.

“A basic bank account would mean that the individuals who are not making a lot of money, and that’s a definition where there has to be a consensus as to what that threshold is, but those individuals would be able to get this facility at any financial institution, and then to have some assurances as to what it would cost from an affordability point of view,” said Mr Rolle.

“When we talk about a basic bank account, for those who qualify there will be some understanding as to what charges, or what maximum charges or what zero charges, apply in the case of certain types of transaction for those facilities.

“Whether it’s making a transfer between banks, or whether it’s about what that monthly maintenance fee is or what it should not be for those facilities. So it’s really just at a minimum to carve out some level of protection for those people at the lower end in terms of economic means.”

Mr Rolle also pointed to the Sand Dollar — the Central Bank’s digital currency — as an additional tool that could help lower financial costs, particularly for Family Island residents who face challenges accessing traditional banking infrastructure.

“The Sand Dollar gives us an opportunity to intervene a lot more directly to control costs. Say, for example, as we think a lot more about how we provide access to some of the cash dispensing services in the Family Islands, we know that making a lot more of that infrastructure interoperable with Sand Dollar could provide direct means to subsidise the cost for persons who might be accessing those services,” said Mr Rolle.