Chaguanas Chamber concerned over spending limits on credit card usage
The Chaguanas Chamber of Industry and Commerce (CCIC) is expressing concern over the implementation of spending limits on credit card usage.
So far, Royal Bank of Canada (RBC) has adopted this measure, with other banks expected to do the same in a bid to ensure a fairer distribution of foreign exchange.
The Chamber, which has made public statements about the availability of Forex to SME’s and current banking practices has called for commercial banks to practise a much fairer allocation and distribution of Forex to both individuals and business entities.
The CCIC notes that other calls have been made for banks to revise their interest rate spreads and dispose of their exploitative service charges, especially in an environment of a contracting and depressed economy.
Noting the measure adopted by RBC, the chamber says while the action being taken is understandable, consideration must be given to how it would affect business transactions.
“Banks have begun to place limits on spending in US Dollars on Credit Cards per month. While this measure is currently being implemented by RBC, we do believe that other banking institutions may adopt similar policies.
However, due to the intricateness of the systems of foreign exchange allocations, businessmen have been using their credit cards to settle their overseas financial commitments. Credit Cards settlements are among the priorities of the Banks list to settle through its international clearing systems.
But the actions being taken on the Bank’s part can be understandable, but how is this going to translate into doing business in 2017?”
The business chamber also noted the trend of consumer behaviour in purchasing what are deemed to be luxury items.
It states that a solution and alternatives must be found to ensure forex availability through the focus on alternative industries that can generate and earn foreign dollars.
“The project initiative that was being led by entrepreneur Derek Chin called the “Streets of the World”, is one such idea that can serve to add to our country’s Foreign Exchange Reserves. This project must be seen as significant and must be allowed to continue,” the CCIC said.
The business chamber added that collectively, as a nation, we must go further and call for the projects to be enacted that are deemed foreign exchange earners for T&T, but a collective effort and Government must begin to take the lead in bringing these initiatives and ideas into reality.