BARBADIANS are reducing their dependence on cash.
The Central Bank of Barbados says that based on the amount of currency in circulation, the public is increasing the use of other payment methods.
This information is shared in the monetary authority’s 2024 annual report.
“During 2024, currency in circulation reached $1.12 billion, with banknotes in circulation growing by $27.7 million to $1.04 billion and coins in circulation growing by $2.6 million to $77 million,” the institution said.
“This $30.4 million year-on-year increase is $12.8 million less than the increase recorded between 2022 and 2023, an indication that Barbadians are increasingly adopting alternative methods of payment.
“The decline in currency in circulation, as a percentage of GDP, from 8.1 per cent to 7.8 per cent is further evidence of this transition.
The Central Bank, which launched new polymer banknotes in December 2022, also reported that by the end of last year “polymer banknotes constituted 71 per cent of all banknotes in circulation”.
“Introduced two years prior, these notes have proven to be both more durable and more resistant to counterfeiting than their predecessors,” it stated.
“Of the $55.8 million worth of mutilated notes the Bank destroyed over the year, only $1.02 million – approximately 62 000 notes – were polymer.
“Additionally, the bank has not recorded any incidents of polymer banknotes being counterfeited, underscoring their effectiveness in enhancing the security and longevity of the currency.”
With money in circulation growing more slowly, the Central Bank said that the Real-Time Processing (RTP) system introduced in February 2023 “has revolutionised fund transfers across commercial banks”.
Enhancing efficiency
This collaborative initiative between the Central Bank
and the Barbados Automated Clearing House Services Incorporated (BACHSI “offers instant and secure transactions, enhancing the efficiency of the Automated Clearing House (ACH) and increasing the volume and value of electronic fund transfers favoured by both private and public sector entities”.
The report said that electronic fund transfers “significantly increased in 2024, while the usage of cheques continued to decline”.
“Total electronic fund transfers through the ACH system soared by 31.1 per cent to $18.8 billion, with RTP transactions contributing $5.2 billion. Concurrently, the number and total value of cheque transactions fell by 11.9 per cent and 14.2 per cent, respectively,” the report stated.
“Transaction values via the Real-Time Gross Settlement (RTGS) system also saw a substantial increase in 2024. The value rose to $23.7 billion, a year-on-year increase of 31 per cent, driven by heightened economic activity and increased activity in the securities market, reaffirming the RTGS system’s critical role in managing large-value transactions between institutions.”
In addition, the Central Bank said that credit card usage surged in 2024, reflecting the strong performance of Barbados’ economy.
“The value of domestic credit card transactions grew by 13.3 per cent, totalling an additional $156.6 million,” it reported.
“The personal sector was particularly active, contributing approximately 76.3 per cent to overall credit card expenditure, with personal credit card transactions increasing by 12.2 per cent and business sector transactions by 17.1 per cent.” (SC)
People going PLASTIC