E-ready for global business

Minister in the Ministry of Finance Ryan Straughn is banking on the build out of the highly-touted national digital payment system to aid in Barbados’ economic recovery.

Straughn indicated on Tuesday that the comprehensive digital payment system will help to address a range of issues including concerns relating to money laundering, financial exclusion, the lack of ease in doing business, and high operating costs for businesses.

He also pointed out that when fully rolled out in about two years, the digital transformation should result in the creation of new jobs especially in the area of logistics, and put local businesses in a better position in a global marketplace.

He was addressing the Barbados International Business Association (BIBA) Talks on Wednesday, which was held under the theme E-Readiness: Digital Payments.

“As we come out of this COVID-19 pandemic we must ready ourselves for what the recovery will mean, and the recovery will be further advanced if our businesses are e-ready, if our government departments are e-ready, and if our citizens are e-ready,” Straughn told the online audience.

“It has to be a truly transformational moment that is important for determining how quickly Barbados will recover, and you will recall this was before COVID and it becomes even more important in a COVID environment that we adopt the digital payments solutions as individuals, businesses and government so that Barbados can come out of this COVID-19 stronger and more resilient than we went into it,” he said.

Stating that for too long, the country has been battling with problems relating to the ease of doing business, Straughn said the transformation process will require a commitment from government, the private sector and every citizen.

The economist said Barbados was still battling issues relating to correspondent banking.

“We felt it was important as a country to set about a course of action that would help to minimize the risk of being associated with money laundering.

“Therefore, the introduction of a comprehensive digital payment system will, in part, solve some of the know-your-customer requirements that are required to sensitize correspondent banks outside of Barbados,” he said.

He explained that the payment system would make it easier for small businesses to be assessed for credit since this system would have “a digital representation” of their records.

“Therefore, the digital payment effort that we are undertaking is intended to help solve the access to credit issues that many small, medium and micro enterprises and individuals are faced with,” said Straughn.

“We want Barbadian businesses to do global business. So while the discussion has been focused on how do we generate as much local business as possible through the introduction of digital payment, what we want to be able to do is to allow any Barbadian business to be able to conduct business any part of the world,” he said.

“Therefore we view the national payment system as critical to the total transformation of Barbados, but that total transformation will only be as effective as ordinary citizens will engage in terms of being able to adopt these technologies,” he added.

Work on the much talked about digital payment system stated in January 2019. Straughn said the seeming delay in its implementation was due mainly to financial institutions being at different levels of technology adaption, and the need for the necessary framework to be in place.

He noted that several commercial banks were in the process of carrying out some form of testing and credit unions were scheduled to do the same.

Straughn said he believed the national digital payment system will create new jobs.

“I believe that what we will see over the coming years is an expansion of the logistics segment of our economy. As more businesses truly now start to deal more with e-commerce, then we will see a further expansion of the network of persons involved in the logistics trade to ensure that delivery and those types of things are routine,” he said.

He gave the assurance that the necessary regulation and standards to accompany the recently passed National Payment System Bill were being developed. There will be periodic assessments and the Central Bank will be the regulator of the digital payment system.

Straughn also said the soon to launch national digital ID will complement the entire digital transformation being undertaken by Government.

(marlonmadden@barbadostoday.bb)