Money transfer fears grow
WITH MAJOR BANKS in North America and Europe dropping their correspondent banking relationships (CBRs) with some Caribbean banks, the International Monetary Fund (IMF) says an action plan has to be developed quickly.
In a statement Friday on the growing problem, the IMF’s executive directors acknowledged that many small jurisdictions in the Caribbean had been affected by the loss of CBRs, though “cross border payments have generally remained stable”.
A correspondent bank is a financial institution that offers services on behalf of another financial institution usually in another country. These services include accepting deposits, wire transfers, business transactions, and gathering documents on behalf of another financial institution.
In Barbados, eight financial institutions have had some correspondent banking relations severed and this has hit the international business sector, the Caribbean Development Bank (CDB) reported following a review last year.
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