Transaction costs review is prepared

Ecuadornews:

Use less cash. That is the objective of reducing the costs of electronic transactions that will be announced these days through a resolution of the Monetary and Financial Policy and Regulation Board.

The executive president of the Association of Private Banks of Ecuador (Asobanca), Julio Jose Prado, said yesterday morning, in a conversation with the media, that this provision is in the Law of Economic Reactivation that was approved in December 2017 however, said Prado, they have not yet approached the Board to discuss this issue.

Marcos Lopez, representative of the president of the Republic before the Monetary and Financial Policy Board, said last week that in these days the new resolution will be presented to make that measure a reality.

“We are always in line with the cost of electronic transactions and that all costs related to cash, which are more expensive, are more insecure, should be higher because we should discourage the use of cash and incentivize electronic transactions, “said Prado.

Currently, the price of transactions varies according to each bank and the ceiling is set by the Monetary and Financial Policy Board. Costs are 25 cents plus VAT for Internet transactions up to 100 dollars for transactions abroad.

But not only will there be changes in transactions. Prado said that in this year some reforms are being prepared in the banking sector that seek a regulatory environment more in line with international standards.

For example, said the head of Asobanca, works on reforms on banking liquidity. Currently, according to Prado, liquidity cannot be adequately mobilized by regulations such as minimum reserves of liquidity, domestic liquidity, among others. This means that liquidity is deposited in certain accounts and the situation is not flexible in the face of an economic recession, for example.

Changes in interest rates are also sought, according to the credit history of each person. For users who have less risk, the interest rate would be low. While for people who have some credit risk or do not have a history, higher rates would be charged.

Finally, it seeks to redefine the roles of the Central Bank of Ecuador and the Monetary and Financial Policy Board.

The figures of the bank

Deposits

Bank deposits reached 28,816 million dollars at the end of January this year, according to the statistics of the Association of Private Banks of Ecuador. The figure represents an increase of 2% compared to the same month last year.

Credits

The gross loan portfolio closed January of this year at 27,305 million dollars, according to Asobanca data. The amount represents an increase of 10.7% when compared to the same period last year. (I)

Source: https://www.expreso.ec/economia/economia-costos-transacciones-banca-electronica-BB2627535