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Trade and investment:

Elizabeth Morgan | Importance of reliable and trustworthy financial and digital services

Published:Wednesday | January 25, 2023 | 12:28 AM
Financial services are now interlinked with digital services and we are all being encouraged to be online with internet access.
Financial services are now interlinked with digital services and we are all being encouraged to be online with internet access.

The media is full of the multibillion-dollar fraud of clients at Jamaica’s Stocks and Securities Limited (SSL). There have also been reports of fraud at two local banks. This actually is not new except for the scale, maybe. If not experiencing it ourselves, we know of people who have had their accounts at various financial institutions hacked with smaller, but vitally important sums, for example, salaries and pensions, going missing from accounts either through cloning of cards or copying of pins and passwords, and other methods. This while we are being urged to join financial institutions for lodgement of salaries/pensions, savings, and increasingly to do online banking and conduct other business transactions (electronic commerce), including trade in goods and services.

Financial services are now interlinked with digital services and we are all being encouraged to be online with internet access. In fact, internet is now an essential service like water, electricity and telephone.

Interestingly, before the reports of these incidences of fraud, the major media issue relating to financial services has been banking fees.


The high level of crime in Jamaica, and other Caribbean countries, including robbery of clients, companies and security conveyances, is making banking, and online banking, a necessity. The problem is that crime, money laundering, tax evasion, the requirement for financial institutions to know their clients, has made it quite onerous to open bank and investment accounts and to change banks.

The other problem now highlighted is that staff in the financial institutions and linked call (customer service) centres also cannot be trusted. There is further need for financial institutions to know their staff. We are now also victims of cybercrimes, externally and internally generated. So trust in financial institutions is being further eroded.

We have already had the situation in which the international banks, mainly from Canada, which have operated in Jamaica and the Caribbean since the latter part of the 19th century, have been downsizing or withdrawing from the region, selling out to indigenous (local) banks. A prime example is the Bank of Nova Scotia which has withdrawn from several Caribbean countries and has downsized its brick and mortar presence and is emphasising electronic banking.

Other issues facing financial services institutions in the Caribbean which have come to the fore in the last decade or more are correspondent banking relationships and derisking measures, as well as blacklisting as tax havens. Jamaican and other Caribbean indigenous banks, such as Sagicor and National Commercial in Jamaica, need to have counterpart international banks in order to conduct international transactions. We have had a period in which counterpart correspondent banks were busily terminating their relationship with Caribbean banks as they were deemed high risk.

The European Union (EU) has had several Caribbean countries on their grey lists and blacklists as tax havens. Financial services institutions in the Caribbean have had reputation tarnished and confidence eroded. The current developments are further degrading that reputation. Having reliable and trustworthy financial services institutions is essential in promoting trade and investment.


The COVID-19 pandemic has highlighted the importance of digital services, i.e., the electronic delivery of information across various platforms and devices. This includes financial services. The two main providers in the CARICOM region are Flow (which is still Cable and Wireless through Liberty Latin America) and Digicel, owned by Irish national Denis O’Brien. Many of us can testify to the deficiencies in services provided by both companies – the inadequate internet access and connectivity in terms of country coverage and the frequency of service outages. In my case, I did not have internet service for about two weeks.

How many times have we been to the bank to hear that the system is down and accounts cannot be accessed which may be due to internal or external disruptions? Or, have we tried to do critical transactions which could not be completed as the bank’s electronic system had crashed or the internet provider was experiencing difficulties?

Reading about Digicel through the Irish Times newspaper, it seems that this company has serious financial problems and has not been able to pay dividends to bond holders. The company recently had its rating downgraded by Fitch, the global rating agency, and doubts have been expressed about whether it will be able to meet payment obligations in March, given the impact of the global pandemic and the current unstable macroeconomic conditions. It seems there is a little more confidence in Flow’s financial stability.

The article in the Sunday Observer (January 22) by the outgoing Chief Executive Officer of Digicel Jamaica, Jabbor Kayumov, points to some of the challenges faced by the companies in the Jamaican market with theft of phones, and the need for stiffer penalties for theft and vandalism of telecom equipment. In December 2022, Flow reported a US$10-million revenue loss due to copper theft and vandalism in Jamaica during the year. The Flow country manager said that over 97 per cent of outages were due to external factors, including power outages and theft.

CARICOM has been talking about creating a regional digital space. In August 2022, Jamaica adopted a national strategy for developing a global digital services sector. This, it is reported, is supposed to be a blueprint for expansion of the industry and to support development and diversification of outsourcing in Jamaica, which is looking to increase exports of high value digital services, attract investments, and exploit new industry trends and technological progress.

So, at the regional and national levels, we have ambitious plans, but our digital services are unreliable and theft is a major source of our problems and our financial services are untrustworthy with crime also being a contributing factor.

How do we promote trade and investment, critical for economic growth, in this technological age when we do not have reliable and trustworthy financial and digital services? As a priority, both the Government and the private sector need to address these issues to ensure rigorous implementation, monitoring and regulation.

Elizabeth Morgan is a specialist in international trade policy and international politics. Email feedback to