Guyana has long been a cash-based society, stubbornly resistant to the many advances in the international financial system over the years, and not in the forefront of the countries in the Caribbean in the implementation of ATM machines, debit cards, credit cards, and online payments. It has followed slowly many years later, after the likes of Barbados, Trinidad and Jamaica.
Our political leaders, financial czars and law enforcers have all bemoaned our society’s anachronistic dependence on cash money, but they seem powerless to drive any meaningful change in the society’s cash habits over the years.
It has been argued that the continuing presence of a thriving parallel economy has contributed to this heavy dependence on cash, but the truth is that even government and private sector employees, who are paid through the banking system, immediately inundate the ATM machines to claim cash for their day-to-day purchases, causing long winding lines around payday. So, cash dependency is quite present in the formal economy.
All this is happening at a time when the world continues to advance along the never-ending path of modernization: from direct deposits, electronic funds transfer, to e-cash and to experimenting with bitcoin digital currency.
In the month of December, when the purchase of consumer goods, commodities and services are at a pinnacle compared with other months of the year, consumers, merchants and the banks themselves will be caught up in a hive of activity transferring cash all across the country facilitating the heavy increase in transactions concomitant with the Christmas season.
Security concerns will skyrocket at this time, as well as the criminal activity that engenders the real need for hyped up security by merchants, banks and consumers themselves. Private security providers and more so the Guyana Police Force, city and town constabularies, and other government based security agencies will be out in full force during this period to attempt to foil or capture criminal elements and their enablers, including informants and lookouts and getaway drivers/riders.
But is it really necessary that Guyana should continue to have such a heavy dependence on cash transactions at the end of 2016 when the World Payments Report states the number of non-cash transactions globally at the end of 2016 should surpass 469 billion for the year, an increase of 10% over 2015. This represents an average of 67 transactions for each of the 7 billion men, women and children on the planet. In Guyana, there is an ever-increasing availability of smart phones and laptop computers in everyday use among the young and not so young, but this has not been converted by the banking system into an acceptance of the safety and ease of performing financial transactions online rather than in person, where many man-hours are lost daily in long, slow-moving lines at the various city banks.
If the technology and the systems are already in place internationally, and particularly in the Caribbean, and these do not necessitate the re-invention of the wheel, so to speak, the question must be addressed as to why the Guyanese public, particularly the working youth and merchants, are not utilising the available non-cash methods of payment for goods and services to the degree that one might expect.
The answer to this question may lie in the issue of recourse. This is likely the same reason that the widespread acceptance of personal and small business cheques have never caught on in Guyana. Even some large and medium sized businesses have been known to issue cheques without having sufficient cash balances in their accounts to cover the transaction. While this is considered fraud, legally, a bounced cheque is considered more or less par for the course when doing business in Guyana, and few of these occurrences are referred to the justice system by victims.
Thankfully, banks nowadays are more likely to close an account which is habitually issuing cheques without the backing of sufficient funds in the account, but more cooperation is still needed between the commercial banks, central bank, the Guyana Police Force and the judiciary to be able to convince the general public that there is an acceptable level of recourse and enhanced possibility of recovery of value if they became prey to some online financial fraud, such as identity theft, credit card fraud, or hacking. The ability of the Guyana Police Force to investigate matters of financial fraud is seriously lacking and the involvement of special prosecutors for such crimes may be the way to go in the near future.
Inevitably, if the general public is to gain confidence in non-cash payment methods, this issue of recourse must be addressed frontally by the banks themselves as providers of the service. Merchants also must be able to accept such payments as a matter of course in a more widespread manner than currently obtains. It is also high time that customers were able to utilise any particular bank account from a single ATM or point of sale terminal to avoid the situation of merchants carrying multiple bank terminals at the payout counter. This will possibly require a degree of collaboration and information sharing hitherto unknown by the commercial banks in Guyana, but here again, it is not necessary to reinvent the wheel, as banks in several Caribbean countries have been operating in this manner for decades.
It is perhaps a little inappropriate for the general public and the leaders in industry, finance, government and law enforcement to be bemoaning the high violent crime rate while doing little to dramatically reduce the high volume of cash circulating in our society. Guyana needs to work on all fronts to drive the progress towards widespread use of non-cash payment systems across the country. The banks of course are the vanguard of this campaign, but the supporting systems, structures, laws, and enforcement must also keep pace if there is ever to be optimum utilization of already locally available non-cash payment systems. A reduction in cash use will certainly lead to a reduction in robberies and similar violent crimes.
Maybe the Minister of Business in collaboration with the Minister of Finance, the Governor of the Bank of Guyana, the Guyana Association of Bankers, the Minister of Legal Affairs, and the Commissioner of Police, for starters, can come together and set their minds to establishing a timeframe for leapfrogging Guyana’s financial system into conformity with financial systems in the sister states of the Caribbean and further afield, always bearing in mind that non-cash financial products, systems, and recourse mechanisms for fraud and error have already been invented and are in use around the world, and the technology is easily transferrable to our shores.
All that is needed from a Guyana perspective is the appetite for change, funding and implementation.
