BoG targets 2020 for National Payment System roll-out
– to reduce prevalence of cash transactions; promote more electronic payments
Almost 17 months after the passage of the National Payment System (NPS) Act, which seeks, among other things, to reduce the use of paper money in transactions, the Bank of Guyana is targeting the full rollout of the project by next year.
This was revealed by Bank of Guyana Governor, Dr Gobind Ganga, during an interview with this publication. According to Ganga, the full rollout of the project will, of course, depend on a number of factors. But if all goes well, the groundwork should be completely laid by 2020.
“We have been modernising our payment system. And that modernisation comes with a number of pieces. We have the legislation. That comes first. Then the infrastructure, the hardware and the software.”
“So we’re in the process of procuring those through various consultants and providers. And that will make the payment system more efficient… let’s put it this way. Hopefully, sometime next year, depending on a number of other factors. But we’re looking at next year,” he said.
A National Payment System (NPS) is a system that provides the economy with information communication technology (ICT) options for processing payments resulting from the many different types of economic transactions that take place daily. In other words, this includes e-payments, credit cards, and wire transfers.
The Bank of Guyana (BoG) was tasked with leading the development and implementing a strategic approach to advancing the development of Guyana’s NPS by establishing the parameters to guide policy and set priorities.
An important bill in principle, much contention nevertheless attended the National Payment System Bill when it was passed last year. Criticism had included concerns over the Bank of Guyana’s role as a regulator, and whether it had too much power.
For instance, former Minister within the Ministry of Finance, Juan Edghill had expressed concern over parts of the bill that allowed the regulator to enter the premises of someone suspected of operating without a license and carry out searches. Edghill had urged the inclusion of stipulations that such searches can be carried out only after a warrant has been obtained.
His successor in Government, Minister Jaipaul Sharma, had defended the bill in his presentation. For instance, Sharma noted that the Central Bank cannot revoke licences in a “willy-nilly” manner, but persons with grievances would instead be given time to defend their licences.
Besides urging that the general public be educated about the new system, none of the Opposition entreaties found sympathetic ears on the Government side. The bill was eventually passed without any amendment.
The Act describes electronic money as something representing cash that is “stored electronically, including magnetically or in any other tangible or intangible device such as a SIM card or a software; issued on receipt of funds of an amount not less in value than the monetary value issued for the purpose of making payment transactions; and accepted as a means of payment by persons other than the issuer”.
Already, most of the major supermarkets allow customers to use ICT options when making payments, such as a customer using their debit card to conduct Point of Sale (POS) transactions. This is the case in several stores. The majority of stores, however, do not have this feature, considered a norm in developed countries.