The Bank of Jamaica (BOJ) is actively developing strategies to make deposit portability a reality locally, meaning Jamaicans could soon be able to move their accounts easily from one bank to another.
Deposit portability will give the banked and unbanked the flexibility to shop around at the various banks to find the services that best suit their needs.
In addition to other features, the dream is that all standing instructions, inclusive of direct debits of credit cards, will remain intact without the complicated account opening procedures or know-your-customer (KYC) hassles.
Speaking with JIS News, Deputy BOJ Governor, Research and Economic Programming Division and Financial Stability, Robert Stennett, explained that the Central Bank is aware that the initiative is a game changer for banking in Jamaica.
“The Central Bank is currently working on strategies that will allow customers to close existing accounts and move their business to another bank easily; and what we call this is actions that will facilitate deposit portability,” he said.
Stennett noted that the BOJ would have to ask crucial questions to make this a reality.
“What is it that facilitates people’s ability to move their accounts around, to shop around and to actually move their accounts around,” he said.
“We admit that this is going to be a long-term effort, because it’s going to take a lot of time to develop the right strategies, lot of time to make the necessary amendments to the law, if there so needs to be, and a lot of time to sensitise and make customers aware of this facility,” said the Deputy Governor.
Find banks with higher interest rates
In the meantime, the BOJ said it is cognisant that bank customers have not seen their savings gain significant interest, adding that it is wise for them to shop around to see the banks that offer higher interest on their savings.
“What the Central Bank has been doing recently is placing the information about interest rates and deposits in the public media, so that the public can see which bank is paying interest rates of say ‘x’ and ‘y’ per cent,” Stennett said.
The BOJ hopes that the transparency will allow customers to make informed decisions about their savings.
“The hope is that because of the transparency that this publication affords, customers will be able to move their deposits where they are able to. But of course, the Central Bank recognises that not all customers are able to easily get up and move their banking business from one bank to the next; and this is why we are working on deposit portability,” Stennett added.