Vincentian traders doing business in Trinidad are in for a final relief as the BOSVG, ECCB and the TCB have come to agreement to facilitate instant payments to traders.
In a letter to this country’s Finance Minister from Governor of the Eastern Caribbean Central Bank Timothy Antoine, the Governor said that the Eastern Caribbean Central Bank ECCB has arrived at a solution with the Central Bank of Trinidad.
The solution he said is two prong and involves the settlement of Trinidad and Tobago currency notes, as well as draft or manager’s checks denominated in Trinidad and Tobago dollars.
The Central Bank of Trinidad and Tobago have agreed to pilot this solution in St Vincent and Grenadines with one financial institution, the Bank of St Vincent, an agreement outlining the terms of the agreement has been concluded with BOSVG.
The pilot would run for a period of six months after which a review will be conducted, and changes made if required. The effective date is 1st November 2018.
The solution involves the following, first aspect the acceptance of TT currency notes. The ECCB will purchase from BOSVG the TT notes on a weekly basis from certified traders.
The amount of TT dollar notes accepted from certified traders on a weekly basis, will be limited to the lower of the legal limit to exit Trinidad or enter St Vincent with cash, which is $20,000 cash, just 10,000 EC equivalent.
The Eastern Caribbean Central Bank will purchase on a weekly basis, Trinidad and Tobago dollar balances up to the limit of $2,000,000 TT monthly resulting from the encashment of TT dollar bank drafts from certified traders
The Governor further noted that BOSVG will be responsible for ensuring that only authorized, traders are facilitated under this arrangement and that all applicable laws are observed.
In addition, the ECCB is expected to ensure that the anti-money laundering counter finance terrorism compliance by licensees in acceptance of the negotiation of the managers, cheques from the traders.
The benefits from this solution are twofold. Firstly, the BOSVG will obtain value for the transactions, processes for certified traders, on a weekly basis thus reducing their foreign exchange, exposure, in TT dollars.
Secondly, given the minimal foreign exchange risk in the solution to the Central Bank of Trinidad and Tobago, BOSVG have agreed that the commision currently charged would be reduced from five percent to three percent thus resulting in an increased value to the traders for the exchange of TT dollars.
BOSVG is committed to reviewing after one month to ensure traders get best value.