The Tribune

EDITOR, The Tribune.

The letter writer Catherine Kelly is usually a “glass half full” sociologist but occasionally she draws back her bow and the arrow lands way off the mark.

She’s done it again with her take on the evolving story of bank practices here. Redlining is a word that rankles many Americans because it is racist and offensive. It is also illegal in the US.

Redlining is the immoral system of determining who can and cannot get services such as bank loans based on the colour of their skin, where they live, etc., and not on their earning power or ability to pay.

Closing a bank branch on a Family Island while opening a posh office in the ritzy Albany community where clients are ostensibly offered cappuccinos and bubbly may not look good but it is pragmatic and makes sound business sense.

Although we are under-banked in terms of our savings and access to loans, there was never a dearth of bank branches, particularly on New Providence. And even as we witness branches closing or amalgamating, there is still no real shortage of walk-in branches across the capital.

A 2019 survey showed that the Bahamas at 25 has more bank branches per 100,000 adults than Canada at 19. Barbados has 15 branches per 100,000 adults, Trinidad and Tobago has 12, Guyana 8 and Jamaica just 7.

Banks tend to proliferate wherever you find rich clients who generate more fees and profits. We kid ourselves if we believe that Chase Manhattan Bank opened on Eleuthera in the 1960s to serve farmers. It was to serve Pan American Airways founder Juan Trippe and his wealthy friends who stayed at the Cotton Bay Club, Windermere and other haunts of the rich and famous.

So why pick on RBC now for cozying up to the mega rich in Albany and Lyford Cay. Don’t think for one minute that Lyford Cay founder E.P. Taylor and fellow Canadian Alexis Nihon didn’t lean on RBC, Bank of Montreal, Bank of Nova Scotia, and others to expand their services here in support of wealthy Canadians they were wooing.

Noted Caribbean diplomat Sir Ronald Sanders described the nature of the Canadian banking beast when he reminded us that when they set up shop in the Caribbean, Canada’s banks didn’t invest one red cent. Over decades huge profits were repatriated to Canada.

Now Canadian banks are generally beating an Algonquin retreat back home and in most places in the Caribbean local banks are rushing to fill the void. Not so here, even though home grown Commonwealth Bank has been reporting record profits.

Ms. Kelly didn’t draw the reader’s attention to the fact that the world is becoming digitized and doing more on-line. It boggles the mind to see the lines out the door at many banks around payday when over 90% of us use mobile devices. It couldn’t be that even in a pandemic Bahamians have a unique aversion to banking online.

While some people don’t have the means or the skill set to bank on-line, it is also true that when the gambling houses closed during the pandemic more of their betting shifted online. Old Uncle Reggie who can’t find the home button on his cell phone, still found a way to place a digital bet.

Government has a role to play, and the Prime Minister has been trying to spell out a national internet policy since 2017. We need fast, reliable and affordable internet service as part of our infrastructure. That will help the unbanked join the transition to 24-hour banking.

Ms. Kelly should know that while she was lamenting what she considers bad faith practices by the local banks, financiers all around the world were toasting our Central Bank for rolling out the first ever nationwide Central Bank Digital Currency.

Forbes magazine said last year: “You could not have asked for a more ideal ground for the release of the world’s first CBDC; a relatively well-off, scattered population with high mobile concentration. The other twist in the story is that the Bahamian dollar is pegged to the US dollar. So, in effect, this can be seen as a pilot release of a digital US dollar by proxy.”

The sand dollar will become our e-wallet and will be how we pay retailers 24/7/365.

It will only be used for Bahamian dollar transactions, but if they are wise then taxi-drivers, straw vendors and tour guides should start investigating how to download a point-of-sale app on their smart phones as increasingly digitalized tourists will pay with credit cards, not cash.

Ms. Kelly should switch off her alarmist clock. The banking future is staring us in the face, and it is not sipping cappuccinos in Lyford Cay, but rather paying for conchs at Potters Cay by swiping sand dollars into the fisherman’s e-wallet.

THE GRADUATE

Nassau,

May 1, 2021.