…as Scotiabank launches new services targeting small businesses
Finance Minister, Dr Ashni Singh, yesterday urged local businesses to start using technologies at Commercial Banks to reduce large cash transactions because of security and other cost factors.
His comments came when Scotiabank launched a number of new services targeting small businesses.
Speaking at the launching at Cara Lodge, Quamina Street, the Minister said that there are huge costs attached to having large sums of cash at any business office. Because of the obvious security risks, there are costs associated with moving large sums of cash–hiring security personnel, installing systems and transport costs to the banks.
Dr Singh, describing it as a double tragedy when a business is targeted by thieves, noted that banks are offering services that include online transfers and payroll processing to customers’ accounts, which if adopted by businesses will not only reduce costs but also the security risks.
Among the new services being offered by the bank to small businesses are revolving credit, term loans, savings accounts, chequing accounts, MasterCard Business Card and online access to accounts that have scope for transfers and other time-saving factors.
Scotiabank’s Country Manager, Amanda St. Aubyn, noted that the new services made it clear that its response to small business affects a broader spectrum of stakeholders than just the business owners themselves- it also includes the wider community.
“Our commitment to small business in Guyana is reflected in our relationships with organisations which support the development of small businesses. These relationships confirm our desire to facilitate the growth of an entrepreneurial class who will themselves become the employers of the future across a range of product and service industries.”
The official noted that small businesses are significantly more sizable than the micro-enterprises.
According to Minister Singh, new banking services in Guyana, once adopted by businesses, would contribute significantly to improving the way the country does its business.
The private sector could stand to benefit from the financial access now being opened up even more.
The Finance Minister said that last year alone, there was a substantial increase of 5.7 per cent in credit to the private sector.
While this was most commendable, it could be improved.
Already, Government has initiated a number of actions designed to strengthen the private sector.
Among these was the establishment of a Commercial Court a few years ago. This initiative has seen improvement in the time it takes for a business to resolve a legal matter. There have even been calls for a judge to be appointed specifically for dealing in business-related litigation.
This helps largely in reducing costs that occur when a matter is dragged out in court.
Another initiative being worked on is a creation of credit bureaus.
Currently, a special Parliamentary committee is reviewing legislation and it is the hope that before the end of this year, it will see passage in the National Assembly.
It is a fact that many small businesses have overtime built up credit worthiness with hire purchase agreements and with utility companies and these could become factors when the credit bureaus become operational.
It will also reduce the costs incurred by banks in assessing its clients for loans and other credit approvals, the Minister said.
The process of modernisation in the banking sector has risen sharply within the last few years, especially with Cricket World Cup when foreigners arrived with their credit cards.
Their coming has led to more businesses now accepting credit and debit cards for payments of services and products.
According to Dr Singh, many overseas business persons shy away from the use of cash and are relying more on the plastic cards.
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