By NATARIO McKENZIE
Tribune Business Reporter
REDUCED fees on debit card transactions could significantly boost commerce in the Bahamas, a leading businessman noting that credit card purchases effectively ruled out roughly 80 per cent of the shopping public.
Dionisio D’Aguilar, Superwash’s president and a former president of the Bahamas Chamber of Commerce, said lower fees on debit card transactions would make such purchases more attractive and reduce the amount of cash businesses would need to keep on-site.
“There should be one fee for credit cards and a much reduced fee for debit cards,” he said. “The banks always complain that every transaction, whether debit or credit, is run through the MasterCard or Visa system and, as a result, the same fee is applied to either transaction even though, on a debit transcation, the risk to the bank is lower because the funds are being paid out of a person’s account. There is no or very little risk of non- collection.”
Mr D’Aguilar added: “One of the reasons that most merchants don’t want to accept debit cards is because they don’t want to pay 2.5 to 3 per cent. They want to pay $0.06 cents per transaction or something like that instead of these exorbitant fees that banks are charging.
“You ultimately want people to come into your business and basically use their ATM cards, swipe, put in their pins and the money transfers. It’s just not economically advantageous of banks to do that right now.
“If banks could reduce fees on debit transactions that would bode well for commerce in general because businesses could reduce the amount of cash they would need to have on premises, but it also creates a platform by which you could do sales over the Internet.”
Mr D’Aguilar further noted that many Bahamian consumers did not have a chequing account and had effectively “maxed out” on their credit cards.
“The use of debit cards is more attractive and it would significantly improve your ability to do commerce, I think. Using credit cards rules out about 80 per cent of the shopping public,” he said.