CI Member exposes interest rate blues

19 Aug 2014

CI Member, the Consumer Affairs Commission (CAC) of Jamaica, has shown how savers are losing out because of shockingly low interest rates paid by mainstream banks.

jamaican financial news

Only one of the main three banks (First Caribbean) rewarded savers who had less than $5000JMD ($44 USD) in the bank.

This campaign by CAC signals a new emphasis on personal finance following its participation in CI’s recent e-learning course on Basic Financial Services.

The commission carried out a survey of interest rates paid on savings accounts by the three largest providers in Jamaica in late July.

The top three banks were NCB, BNS and First Caribbean and the survey also included important information for savers on withdrawal fees, dormant fees and fees paid for not keeping a minimum balance.

Commenting on the survey Mrs Dolsie Allen, CEO of the Consumer Affairs Commission in Jamaica said: "As a result of CI’s finance e-learning course, the Consumer Affairs Commission researched the actual interest rate offered on savings accounts by Jamaica’s three largest banks and the results were unbelievable.

"The rates were extremely low in all instances and non-existent for savers with low amounts in their accounts.  In one case no interest was offered before the amount in the account exceeded J$50,000.”

Mrs Allen also noted that “while some banks offer higher rates, these are tied to specific savings requirements, minimum balances, usage requirements, strategy, competition and other factors.”

Each year 150 million consumers enter the financial services market. The industry is growing at a pace in developing and developed countries.

Changes in how consumers receive and send money,  how we pay for things and the advent of mobile and online payments means that consumers are increasingly using financial services.

This market expansion needs to be complemented by more consumer advocates and watchdogs to help ensure consumers are getting a fair deal.

Nicola O’Reilly, Global Programme Manager (Financial Services), said: “It is fantastic to see the Consumer Affairs Commission of Jamaica taking practical action to help savers identify the best deals out there.  

“The CAC generated significant national media coverage for their work which helped them reach as many consumers as possible.”

 CI Members from 24 countries took part in the recent Basic Financial Services e-learning course – CI will continue to share updates on how they have taken practical action to support and empower consumers to get the best deal from banks and other financial services providers.

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