Credit unions play an important role in the financial sector because they have significant potential to reach the most vulnerable income groups. However, their regulation has been a supervisory blind spot and various governance issues have surfaced in recent years.
It is with this understanding that Central bank Governor, Dr. Gobind Ganga noted that his institution is working towards increasing credit unions’ familiarity with International Financial Reporting Standards and improving internal control systems in a way that is appropriate for their complex governance procedures.
Ganga said that this is all part of his Board’s move to improve the overall work of the Bank.
Further to this, he said that Bank of Guyana has opened a line of consultations with the financial sector on the feasibility of implementing agency banking. He said that the Bank is in the process of receiving feedback on this initiative from relevant stakeholders before proceeding further. With agency banking, Ganga said that representatives of the financial institutions will be able to make financial services accessible to the wider populace, particularly rural communities.
To continue the enhancement of the efficiency of the financial system, Ganga said that the Bank of Guyana will undertake payments system regulatory reform and infrastructure development targeted at clarifying the legal framework for electronic payments, enhancing the efficiency of payment processing, expanding the use of electronic payment systems, and reducing the costs of money transfers.
Dr. Ganga noted that the aforementioned is crucial since a 2017 payments cost study conducted by the World Bank’s Payment Systems Development Group (PSDG), notes that an efficiently functioning electronic payments system could save the Government up to $266 million (0.04 percent of GDP) annually.
