Credit unions back off from bricks-and-mortar idea

The proposed establishment of a locally-owned cooperative bank for Barbados may be off the table.

President of the Barbados Cooperative & Credit Union League (BCCUL) Hally Haynes has said that certain developments in the financial services sectors in recent years are pointing the movement towards a digital operation instead of a physical structure.

“The bank is something we will have to revisit given that a lot of things have changed in the last three years,” Haynes told Barbados TODAY.

“Correspondent banking relationships, that is one of the critical components.  If we are going to establish a bank, you have to ensure that you have correspondent banking relations…then you have to look at how the industry is moving.  So there are a lot of factors to consider when we revisit the bank…whether we move to a digital bank or we look at brick and mortar,” he stated.

“And you could see clearly that a lot of people are moving to the digital banking rather than the brick and mortar bank. That is something we will need to consider when we revisit the cooperative bank,” the spokesman for the movement added.

Haynes said while the cooperative bank has been under discussion for some time now, credit unions are aggressively looking at the online banking services for its customers.

He indicated that the COVID-19 pandemic may even have motivated the movement to fast-track going digital in a bigger way.

“COVID-19 has created some challenges, but I think it has created an opportunity for the credit union sector to upgrade its infrastructure, but more importantly, respond to members so that they can have access to their funds online, whether through ATM cards, whether through the online banking modalities or through the mobile wallet which should be coming shortly,” the BCCUL president told Barbados TODAY.

“As we speak as a movement, our idea now is to ensure that we provide online banking services to everybody…and that is something we are actively working on. We are hoping that before the middle of the year that we would make some significant progress. We are working on a mobile wallet…and that will be able to give some people that do not have ATM cards, access to their funds,” the credit union official disclosed.

The idea of an indigenous cooperative bank had not been without controversy.

As far back as 2014, the Barbados Workers’ Union (BWU) and the City of Bridgetown Cooperative Credit Union (COB) opposed the establishment of such an institution.

(emmanueljoseph@barbadostoday.bb)