Sat | Sep 22, 2018

NCB delays fee increase

Published:Monday | March 5, 2018 | 12:02 PM
Hylton ... Like any other business, NCB incurs costs to provide the services we offer.

The National Commercial Bank has released a statement saying it will not implement the recently announced fees that were scheduled to take effect on May 1.

Commercial banks like NCB have been facing increased scrutiny over the imposition of fees costing customers billions of dollars a year.

READ: NCB Bats For Bank Fees

But only last week, NCB's President and CEO , Patrick Hylton said, bank fees are vital to the financial institution's daily operation and should remain an integral part of the competitive approach of the local banking sector.

SEE NCB's FULL STATEMENT BELOW:

National Commercial Bank Jamaica Limited (“NCB”) will not implement the recently announced fees that were scheduled to take effect on May 1, 2018. We take this opportunity to educate the public regarding the basis for the fee increases for complete transparency and to reinforce our commitment to providing affordable, convenient, and safe banking options for all customers. We welcome dialogue regarding this issue as we continuously work toward serving our customers better. 
 
Basis for announced fees
 The foreign draft fee increase was a result of a 100% increase in the fee the U.S. correspondent bank charges NCB to process these transactions.
 The other announced fees were largely focused on non-personal accounts, and only triggered in the instances where transactions are initiated by the customer, processed by NCB, but later cancelled or reversed by the customer after they realise an error has been made. In this process, NCB would have already incurred the cost to process the specific transaction before the reversal or cancellation was initiated. However, reversing transactions requires resources and verification. It is time consuming and costly. We ask the public to consider if the business had hired a bearer to deliver a payment via cash or cheque but subsequently realised that the amount was incorrect and had to later make an adjustment. Notwithstanding the error made by the business, they would still need to pay the bearer for the labour that was expended. The same principle applies for an electronic transaction, which has to be manually reversed.  

NCB provides options for free and low cost banking
Like any other business, NCB incurs costs to provide the services we offer. Even accepting and securing deposits incurs costs such as real estate and labour costs, security and insurance.

This is why customers can have the confidence that their money is safer in the bank versus at home.

The majority of our services are heavily subsidised based on a review of our internal costs to process, and fee comparisons we have made with banks in the region and banks in the United States of America.

Notwithstanding this fact, we continue to invest millions of dollars in technology to provide customers with options for fee-free banking.

Many of the services available at our Bank on the Go intelligent ABMs and Kiosks are free, and the machines are available to our customers 24/7 for their convenience. In addition, we have removed fees from dormant accounts, there are no fees applicable for START accounts for children up to 18 years old and our Gold Club accounts for senior citizens qualify for significant discounts on several banking services.

To further expand financial inclusion, we have launched NCB Quisk – which allows customers to create a digital bank account or mobile wallet that carries no minimum balance requirements or minimum balance fees and allows customers to make person to person transfers, withdrawals and deposits at our ABMs, pay JPS bills and make purchases at select NCB merchants island wide by using simple SMS messages or the NCB Quisk mobile app. 

NCB’s contributes significantly to Jamaica
Any Jamaican individual or company that does well financially will positively benefit the country. In the same way we see how our renowned athletes are able to give back to the society in a meaningful way, NCB has consistently contributed to the building of our country.   

NCB Financial Group is a public company with shareholders who expect a certain level of return. Without attractive returns, businesses are unable to attract capital, and without capital, businesses become challenged. Countries with troubled banking sectors have challenges remaining or becoming economically vibrant. Therefore, NCB must provide its shareholders with an attractive return.  Many of our shareholders are retired senior citizens and average Jamaicans who depend on dividend distributions for income.  

Beyond providing our shareholders with an attractive return, NCB also contributes significantly to the Jamaican economy by way of:
*the billions in taxes we pay annually (we are the largest contributor to the tax base).  Between asset taxes and income taxes alone, NCB has an effective tax rate of 32%. This does not include irrecoverable GCT, property taxes and other taxes we pay
*the billions we pay to the thousands of small and medium sized businesses who provide us services and who in turn provide employment to thousands of Jamaicans
*the people we employ and the salaries we pay our employees, who also contribute to the tax base
*the thousands of donations we make for scholarships and community initiatives through the NCB Foundation totalling over $100M in donations per year and over $1.5 billion dollars since the inception of the Foundation Jamaica needs to embrace digital solutions for the advancement of the country.

As the world becomes increasingly digital, we are disappointed with any recommendation that supports non-electronic banking practises such as paper statements, cheque encashment, or conducting transactions in-branch versus anytime anywhere, as these put Jamaica significantly behind the rest of the world and contribute to low productivity, inefficiency and stymies economic growth.

We engage with global companies such as Amazon digitally, and we must do the same locally.

We want to help our customers and Jamaica more broadly to accelerate our participation in the digital global economy so we can effectively compete, grow and flourish as a society. This is our best option for growth going forward and it is important that we collectively embrace this reality, and reject any solution which puts us at risk of being left behind the rest of the world.

The deep mobile penetration in Jamaica creates significant opportunities for lower cost banking through digital solutions, and we are invested in bringing that experience to our customers.

However, we are also determined to ensure those with limited access to technology are able to access exciting, efficient and lower cost digital solutions. Our Bank on the Go  and NCB Quisk solutions , are illustrations of this.

We recognise there are always opportunities for improvement in our service and technology, and this is an ongoing journey at NCB because we respect and value our customers. Complaints, feedback and suggestions are welcomed and appreciated and can be channelled to cem@jncb.com or via our Facebook Messenger Box.