The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Central Bank's governor last night denied that money transfer businesses are being restricted from conducting international transactions to help preserve The Bahamas' foreign currency reserves.

John Rolle, in an e-mailed answer to Tribune Business questions, said the operating mandate imposed on money transmission businesses in return for allowing them to open during the COVID-19 pandemic had more to do with ensuring social distancing protocols are enforced.

"This is not a Central Bank view or policy," he replied, when asked by this newspaper whether the prohibition on international money transfers was designed to help safeguard the reserves. "The money transmission businesses' (MTBs) operating arrangements are being guided by public health safety concerns to limit in-branch customer traffic.

"The Central Bank takes a holistic approach to managing access to foreign exchange markets. Commercial banks are the conduits for foreign exchange passing through our financial system, including the supplies flowing through MTBs. The flexibility given to commercial banks, which has not changed, determines the access that all persons and businesses enjoy to foreign exchange."

However, several sources in the money transmission industry have voiced suspicions to Tribune Business that the restriction on international transactions has more to do with helping to buttress the foreign currency reserves than public health/social distancing concerns.

One, speaking on condition of anonymity, said: "Government is trying to discourage international transfers because of the balance of payments. They have not announced that, but that's their position. They have made it very difficult for us. We have a mandate not to open our doors for international persons."

The source contrasted the approach to money transmission businesses with that for commercial banks, whose clients are still able to access the funds they need for international transactions whenever they need them.

Money transfer businesses, by contrast, tend to deal with smaller clients and sums, including foreign workers sending remittances back home as well as receiving monies from friends and families. "These are the people that, at this point in time, need it most," the source added. "They have no way of taking care of their livelihoods."

The sector has been permitted to open outlets with their own entrance from 9am to 1pm for the conduct of domestic transactions only. With no replenishing cash inflows from tourism and other foreign exchange earnings, the Central Bank's reserves, standing at $2.03bn at end-February 2020, were projected to decline by $900m by year-end 2020 - a prediction made before the total tourism shutdown.

Meanwhile, Bahamas Power & Light (BPL) last night unveiled its own three-month payment deferral plan to July 1, 2020, for customers who catch COVID-19, are quarantined because of it or are laid off.

For each of the three tiers of affected customers, the account must be in the applicant's name, and the account number and the National Insurance number must be provided along with either proof of diagnosis, proof of mandated quarantine or proof of layoff.

Whitney Heastie, BPL's chief executive, said: "As Bahamians continue to cope with the unprecedented challenges of this virus, we at BPL are committed to assisting our customers as best we can through the difficulties ahead.

"We have created this relief programme in line with the Government's desire and our wish to ensure that customers are able to meet their obligations without sacrificing their own security and sense of safety."