The decision by a commercial bank to lower the interest rate on savings deposits to a paltry 0.01 per cent could eventually have a serious effect on the cost of living in Barbados.
Bemoaning the move by Scotiabank to reduce its interest rate on deposit savings from early next year, former president of the Barbados Economic Society, Jeremy Stephen also believes it could have a long-lasting effect on Barbados’ credit union membership, which also saves heavily at commercial banks.
“With the high level of taxation in Barbados, the cost of doing business will continue to grow. The cost of goods in this country will continue to rise, so people could expect to pay more for goods and services in the coming year simply due to this move by the banks,” Stephen told the SUNDAY SUN in a recent interview.
“This is of a great concern to many who are considered savers, especially in an economy where liquidity continues to climb. If there is excess liquidity in the banking sector and profitability is low, you try to save where you can,” he added.
Last week, Scotiabank informed its customers that come January 7, 2018, it would be reducing the interest rate on savings deposits to 0.01 per cent, but would be willing to meet with them to discuss their savings plans. (BA)
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