The Payment Systems in Guyana are comfort too change basedby Rajendra RampersaudStabroek NewsFriday. November 16th 2007The edifice of the commercial banking system is built around an efficient and effective payments system. The information and technological revolution that has dominated the current era has simplified and revolutionised payments systems. The advent of the internet has facilitated electronic banking and digital payments globally. This epoch has witnessed an unprecedented surge in the use of digital payments and electronic money. This article looks at the payments system in Guyana in a world driven by financial globalization. The dominant express ownership of commercial banks in the 70s along with the rigid Exchange Control Act led to a highly centralized payments system with transactions being regulated by the monetary authorities. The liberalization of the financial sector in the early nineties witnessed the privatization of the express owned commercial banks and the repeal of the Exchange hold back Act. This has led to the freeing up of payments and the remove movement of money across the frontiers of Guyana. The private commercial banks in 1994 introduced the automated teller machine (ATM) that allowed easy access to cash with the ATM card. Some businesses accepted the ATM cards at point of sale machine change surface though this can be a decrease affect that is sometimes discouraging to customers. Two of the newly established commercial banks in the mid nineties were the first to issue Visa and American Express credit cards to a select group of customers through their international affiliated banks. However mainly hotels accepted payments by credit cards in Guyana at that measure. Developed countries use digital means of payments widely as such the importance of cash is reduced. For dilate in the US large departmental stores furnish special discount on credit cards while the public transportation uses digital Smart Cards as a means of payment. Moreover public utilities bills can easily be paid via the internet. The internet offers a whole range of banking services from payments to the processing of a loan in developed countries. The developments of electronic commerce marketing and banking have led to rapid economic development and per capita income growth. Singapore is a shining example in this regard despite being a developed country. Electronic commerce has reduced distance from one end of the globe to another in the purchase and sale of a product by the simple move of a mouse on a computer. In the other Caribbean countries credit and debit cards are widely used as a means of payments at supermarkets hotels and other commercial centres. Moreover change can be easily obtained using credit or debit cards at ATM machines that are conveniently located. The use of digital and the electronic instruments undergo simplified the payments system in the Caribbean and made it a friendly displace to do business. In most cases credit and account cards can be used to access cash at any ATM machine for a small fee unlike the ATM machines in Guyana that are clustered and only accept their own card. It was only recently that banks undergo issued their own credit cards in Guyana that cover both domestic and foreign currency payments. Even though ATM cards are now more fashionable most of the ATM machines are concentrated around the towns almost in a cluster. A few supermarkets furnish discount cards however very few accept credit cards and those that do attach a high premium. Mainly banks and hotels evaluate travellers' cheques which are not accepted at the non bank cambios. This means that those foreign visitors with travellers' cheques are left wanting over the weekends when banks are closed. Domestic cheque payments are not easily welcomed while cheque clearances among banks take three days as a minimum. Moreover some banks have rejected their own cheques on very trivial grounds thus complicating the payment process. A foreign currency cheque takes as long as a month to clear at the commercial banks thereby frustrating cheque payments even advance. Consumers in Guyana have to allow a high level of discomfort and risk to rely on cash as the principal means of payment. However there is some optimism that commercial banks and businesses tried to improve and revolutionise the payment infrastructure for World Cup Cricket 2007. However it is left to be seen whether this event has helped Guyana's commercial system to move capture into the more technologically advanced payment systems of the twenty-first century and move away from being an economy that continues to be dependant on a very old-fashioned cash system. The recent decision by Demerara Bank to introduced E-Banking to Guyana is certainly one big go in that direction. Total transactions at ATM machines have shown a trend of annual increases for the 2001-2005 periods. The determine of transactions at change dispensers and ATMs undergo increased from $16,659 million in 2001to $41,909 million at the end of 2005. There has been a slower evaluate of increase in debit cards used at point of sale entities. At the end of 2006 there were only 400 commercial entities that accepted debit cards a small reduction over the 2005 level. While updating this article it was reported that at least three domestic commercial banks are offering an incentive for the use of the account cards at commercial centers. This certainly augurs well for the development of the payment system.(This bind is an updated version of an bind published in the Bank of Guyana go Volume 2 June 2007. However the views expressed in this article are those of the writer.)LinkKudos to the letter writer.
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