“My Bosses Want Us To Do More Of The Draconian Type Of Measures…”

Kareem Michael

During the conference in Jamaica, Michael said “My bosses want us to do more of the draconian type of measures and it is important that I am able to explain to them why these things shouldn’t apply”. He didn’t share details, but today he said he may have used a strong word.

Kareem Michael, Governor, Central Bank of Belize

“I may have used a strong word by a draconian. I think these sort of dated policy measures can have unintended consequences. And I think it was asked earlier that what if we go tit for tat? What if the commercial banks now say that I will collect this whatever loss I may have from what I’m doing up here, and more, through some other fee, somewhere else? That is not what we want. What we’re trying to show is how by lowering these things, we’re promoting financial inclusion, and thereby giving you more participants, more opportunities for your to continue to engage in traditional banking services. You’re real money is on the loan. On top of that, you’re the smooth out volatility in deposit base and having more liquidity. So you’re manage your institution better. And there’s a number of opportunities if the real sticking issue is ATM. There’s a number of opportunities where everybody can be on a shared network. Many different structures work in other economies where there’s opportunity to sort of reduce the cost of the ATM, but it’s not up to me to recommend that to the Bankers Association. So, the, the choice of word may be a bit strong, but yes, what we want to avoid is as, this is a last resort, because of the danger or the likelihood that fees costs may be passed on to something else. That’s well understood. That’s in the literature that’s regurgitated several times.”