Politicians have been assured that various banking issues hampering local businesses are known, with multiple actions planned to ease troubles by the end of next year
In a letter to States members, Deputy Neil Inder, President of Economic Development, explained the “significant changes in retail banking” over the past years and the steps being taken to take the pressure off business.
It’s recongised that lengthy account opening processes for businesses, as well as sudden withdrawal of pooled accounts, coupled with limited access to credit cards and major online payment service providers is hampering some firms’ ability to operate and grow.
“Maintaining or enhancing the banking sector is important to ensure that the Bailiwick remains and continues to be recognised as a premier international financial centre, capable of providing a diverse range of financial services,” Deputy Inder said.
Pictured: Banks and other payment providers have advised Economic Development with issues they face in the local market.
A review into the banking sector by an appointed third party will conclude at the end of this year and should dovetail with a similar review being carried out in Jersey, Deputy Inder said.
A joint "communication" from the three Crown Dependencies has been sent to banks “expressing the concerns” and the fact a joined-up approach is being taken on business banking woes.
Economic Development says it has been informed that ageing IT systems are proving to be a barrier to speed and set-up for lenders locally.
A planned programme of IT upgrades to the Guernsey Registry, the local equivalent of Companies House, could also include changes to assist banks and payment platforms with streamlining services or entering the local market.
Deputy Inder said this “may include” API access for third parties, which would allow banks to check relevant data quickly prior to the opening of business accounts.
Another issue for payment platforms is that “they cannot complete their automated due diligence processes on applicant businesses via the Guernsey Registry”.
A paper from the Registry will be considered at the end of the year on “technical solutions to address this challenge” with a view to add any necessary upgrades into the wider IT changes the following year, Deputy Inder said.
Pictured: Steps are being taken that could ensure more people can get a credit card.
Credit card provision is also recognised as an issue, with Deputy Inder saying “it is clear that short-term solutions need to be found” as individual’s are being denied access or “erroneously” notified that services are being withdrawn.
The Committee has been supplied a list of issues clearing banks have identified as bogging down the distribution of domestic credit cards.
Work is now underway with Home Affairs to beef up the electoral roll so banks and other firms can verify identities and addresses of residents, noted as an “important part of their credit scoring process”.
It’s hoped the new electoral roll will be in place ahead of the 2025 general election, but in the meantime temporary credit reference certificates can be produced by Home to validate information “which in turn may assist in individual applications in the short-term”.
Changes to the electoral roll will require legislative changes to the Reform Law and must comply with general data protection laws.
Each of these processes combined should gauge what information banks need to ensure more credit cards can be sent out, with local surveys also feeding into investigations.
“The Guernsey Chamber of Commerce is surveying its members on the issues regarding payment platforms, and the Committee for Economic Development is grateful for this work, which will help prioritise the potential technical solution that can be developed,” Deputy Inder said.
Once your comment has been submitted, it won’t appear immediately. There is no need to submit it more than once. Comments are published at the discretion of Bailiwick Publishing, and will include your username.
There are no comments for this article.