Sunday, September 23, 2018

National Payments System

Guyana's National Payments System Vision as articulated in the National Payments System Strategy 2018, is to:

“Build a robust, safe and sound, efficient and inclusive NPS that meets the current and future needs of the economy, supports financial activity and financial sector development, advances the use of electronic payments, contributes to financial risk mitigation, achieves compatibility with international systems, and adheres to the relevant international standards, guidelines and codes.”

Initial Efforts to reform the National Payments System

Efforts to reform the Guyana National Payments System commenced approximately four years ago. The Bank of Guyana with World Bank’s Technical Assistance (TA) through its Payment System Development Group (PSDG) embarked upon a diagnostic exercise to reform the National Payments System (NPS) and to propose a NPS development strategy to guide the Bank’s efforts.

During the scoping mission the World Bank Team met with staff from various departments of the Bank of Guyana, two commercial banks, the Guyana Securities Council, Guyana Post Office Corporation, two remittance companies, Mobile Money Guyana, the Accountant General’s office and the National Insurance Scheme (NIS). These meetings provided a high level overview of the status of the National Payments System, the plans underway, the perspectives of the various stakeholders with respect to the NPS and the context in which reforms would need to be carried out.

In the discussions with the stakeholders and the Bank the issue of justifying investments in a modern electronic payments system for a country like Guyana with modest payment volumes was raised. To address this, the World Bank proposed and undertook in collaboration with a local firm a detailed study of the cost of cash and other payment mechanisms prevalent in Guyana, to provide a strong basis for building a business case for reforms. This study which was conducted over a period of a year concluded that a case was made for the modernization of the Payment System as moving to electronic payments could save the country $6.5 billion annually.

This comparative cost study served as the basis to align stakeholders behind the goal of the NPS reforms, enabling dialogue and driving impact in creating innovative and country-specific solutions and formed the basis for World Bank support of the Payment System Modernization Program which commenced in late 2016.

Arising from this technical assistance, a National Payments System Bill, passed in parliament along with four (4) drafted supporting regulations addressing Electronic Funds Transfer, Agents, Electronic Money and Oversight which were developed and sanctioned by BOG.

Disclaimer

The information on this website does not constitute legal, financial or other professional advice but provides information for general reference purposes only. Every effort is made to ensure that the information given herein is of sound quality but no legal responsibility is accepted for any errors, omissions or misleading statements in the information, caused by negligence or otherwise.