The Tribune

By FAY SIMMONS

Tribune Business Reporter

jsimmons@tribunemedia.net

The Central Bank’s governor yesterday asserted progress will be made during the 2025 first half on developing low-fee bank accounts for vulnerable customers and establishing a consumer watchdog.

John Rolle, speaking at the Central Bank’s latest quarterly economic briefing, said the banking sector is working with its licensed commercial institutions to allay consumer and government concerns over the level of bank fees and how they are assessed and charged.

He added that the Central Bank is working to establish a ‘basic bank account’, which is expected to lower deposit and service fees, as well as carving out the framework for a Financial Services Ombudsman who will provide redress for Bahamian consumer grievances.

“We have a very elaborate work plan to look at issues in the sector, and that work is continuing. We expect some results in the first half of 2025. One of the areas that we’re working on is how to bring the basic bank account into being for Bahamians. And that would be one of the very targeted ways in which to provide some carve out against the fees that banks might charge for deposits and other services,” said Mr Rolle.

“But our focus on consumer financial protection does include work to look at how we progress even further towards setting up a more detailed framework for a Financial Services Ombudsman to deal with issues, as well as adding even more transparency to how consumers are able to navigate the space.”

Mr Rolle said these steps will also be effective in dealing with consumer complaints about merchants leveraging additional charges when processing credit or debit card payments.

“There are some areas around fees, too, where, on the payment side, our work would also have some impact because we’ve hinted before, as an example, that some of the practices consumers encounter interacting with merchants for the use of credit and debit cards, there are often costs that consumers are encountering, which will also be looked at in the context of the sort of issues that we’re looking at,” he explained.

Mr Rolle said the Bahamian economy’s growth rate for 2024 was below the 2.6 percent gross domestic product (GDP) expansion estimated for 2023 but still in “the 2 percent range”.

“In 2024, the economy’s growth rate is projected to slow to below the estimated 2.6 percent recorded in 2023,” said Mr Rolle. “We do not have an estimate yet for 2024. I know that there are lots of forecasts out there, some from the IMF and from other parts, but we know that in 2023 the growth rate was still in the 2 percent range.

“And last year, 2024, we expected that the momentum would have been a bit tempered relative to 2023. So, just generally speaking, we anticipate that the growth rate would have been a bit less.” Mr Rolle said The Bahamas has a $15bn economy that is growing by about $500m annually when accounting for inflation, which creates the potential for government to improve its revenue performance.

“This is a roughly a $15bn economy. So, if you take the real economic growth, and you factor in what’s happening at the level of inflation and the like, and look at what’s happening on a nominal level, these are still translating into $500m or thereaboutsin terms of the added value of economic activity that is happening within the growth estimate that we’re referencing on a nominal basis,” said Mr Rolle.

“As well, on a nominal basis, it is giving you an appreciation for the extent to which, year-over-year, the Government has the potential to improve its revenue performance if its revenue is optimally attached to the activities that are expanding year-over-year.”