It will not be too long before the Government will no longer be issuing cheques as payment to persons.
That’s according to Minister in the Ministry of Finance, Ryan Straughn, who said that the goal will be to deposit the funds directly to a person or business’ account. He made the comment while piloting the debate on the Central Bank of Barbados Bill, 2020 in the Lower House yesterday morning. He indicated that it is the Government’s intention over the course of the next two years, if not sooner, to eliminate the issuance of cheques. A process, he added, that has already started.
“You would appreciate that when I write you a cheque as a Government department, somebody has to come and collect that cheque. But before somebody comes and collects that cheque, the Treasury Department has to ensure that there is money in the account for the specific entity to print those cheques. Then the messenger has to come and collect the cheque to take to the Department. The Department then has to call you to tell you that the cheque is ready. You then have to send somebody to collect the cheque, who will then take it to the bank to deposit... It might take three days Sir for the money to clear, because the cheque [is] crossed, and all of that time, all of that effort is multiplied thousands of times across Government,” he lamented.
Minister Straughn said that is not only a challenge for the public sector, but the private sector as well and the cost – that is “the time spent for people to do that activity as opposed to something productive” is unnecessary.
“We [will] seek to roll out the national payment system, which will come before this Chamber in short order, to digitise the way that we do things so that our processes for payments, which obviously are predicated on ensuring that persons can have access to bank accounts or credit union accounts... When I get to the point where I can use my phone to buy my coconut water on Sunday, I would be a very happy man, because it would mean Sir, that we have penetrated and provided a level of financial inclusion which is important in this country,” he maintained.
Contending that it is imperative that the country reach that point, he said that the Central Bank is a critical institution for unlocking the “pent up capacity” within the system. He said the Bank has to be geared to facilitate the upgrade of the technology that allows for electronic payments to be done.
“We have too many people when the day comes running around moving cheques, moving money, trying to determine whether payments [have] gone through... Whilst these people are hired to do that specific job that is not really adding anything new to the output in terms of the economy. Therefore, for businesses [and] employers, what we want to do is pivot now and redirect those resources to something that is much more productive in the context of your business,” he said.
The Minister said that while the Government is leading the charge with respect to the modernisation of business, the private sector along with the financial institutions have a role to play in encouraging ordinary Barbadians to get on board.
“This is a change that I believe would be significant and would create opportunities for real economic growth in this country and we in this government are committed to unlocking those avenues for growth,” he added. (JRT)