ONE player in the financial sector who wished to remain anonymous is charging that the Government is to be blamed for most of the issues consumers are facing with regards to increasing bank fees and charges.

The financier told the Jamaica Observer that the issues are caused by “the structure.”

“All sorts of argument are being made that poor people have a choice to move their accounts from institutions raising fees to one with low or no fees, it’s not so easy,” he charged. “People literally have no choice, because the Government created the system, which limits the choices, especially for people who work with the Government,” he continued.

He added that while there is now a reduced know your customer policy, which allows for people to open some bank accounts much easier than in the past, that still doesn’t solve all the issues consumers face in doing business with banks.

“You should really blame the Government for creating the oligopoly they have created in the banking sector. They can’t tell the banks anything.”

The financier went on to say that the structure which impedes consumer decision is linked to the automated clearing house (ACH) – a source of direct payments from one bank to the other. He pointed out that certain financial institutions are excluded, so people can’t get paid in certain accounts like at credit unions which offer low or no fees. He also pointed out that some entities like VM managed to get into ACH “through creative means.”

“If you calculate how much money people pay in fees each month, can you imagine if they were able to put that in a pension fund and save little by little each month towards your retirement. Some people are paying up to $5000 per month in fees. That could help to secure your future in a retirement account,” he exclaimed.

St Catherine South Member of Parliament Fitz Jackson, who has been on the forefront of the push against banking fees, recently tabled questions in Parliament, asking the Government to look at legislation that will make it easy for people to switch accounts from one bank to the other.

“What I am seeking to do is to say, if a customer is displeased with the service of a bank, don’t cause them to be shackled to the bank because of the disincentive to provide the information necessary to open an account in another bank. The Bank of Jamaica requires all licensed deposit-taking institutions to have information on each depositor which satisfies the know your customer requirements…and all that needs to be done is for each bank that has that information, as required by the Bank of Jamaica, to be able to provide it on the request of the account holder to another bank, so they don’t have to go through resubmitting the information, because it is already supplied to a license institution,” Jackson told Sunday Finance recently.

He said such a requirement would facilitate better customer service and greater competitiveness by the banks.