Gov’t to fine banks with bad ABMs

The government is gonna start punishing banks whose ABMs are out of cash for more than an hour! 

Finance Minister Dr Nigel Clarke says banks who fail to meet the minimum service standards for ABMs will be fined once the new finance sector regulations take effect… in 2026.

We’ve talked about the struggle with ABMs a lot on this platform. Especially during Jamaica’s whole money heist era. It was a real struggle!

So back in April, the Bank of Jamaica listed eight service standards that deposit-taking institutions must follow.

These include: working ABMs should be up at least 95 per cent of the time, and should not be out of cash for more than one hour in urban areas and three hours in rural areas. 

However, the BOJ didn’t announce any sanctions or repercussions if the banks failed to meet these standards. 

For example, when utility companies fail to meet guaranteed standards, the OUR, which is their regulator, forces them to pay affected customers.

But Jamaica’s current laws don’t allow the BOJ to fine banks for not meeting these standards. Dr Clarke said the Financial Services Commission, FSC, will be the regulator and non-compliant banks will be fined. 

The exact amount will be announced once the new regulations come into effect in 2026. 

Jamaica is transitioning to a Twin Peaks regulatory model and Clarke said it would be better and more efficient to do everything all at once. Rather than change the regulations now and then again in 2026.

Currently, the BOJ supervises all deposit-taking institutions. These include commercial banks, building societies, merchant banks and credit unions. Meanwhile the FSC oversees non-bank financial institutions. These are securities dealers, insurance companies, pension funds etc. 

The Twin Peaks model will have the BOJ regulating all financial institutions, DTIs and non-banks. While the FSC will oversee market conduct and consumer protection for all financial services.

Which is why the government is saying to wait to start the fines.

And that’s the bottom line.