‘Bajans having a hard time repaying their debts’

In what appears to be a sign of the hard times, an increasing number of Barbadians are having difficulty repaying their loans on time, according to the island’s largest credit union.

President of the board of directors of the Barbados Public Workers Co-operative Credit Union (BPWCCU) Limited Raphael Holder said while the financial cooperative was doing well despite the current economic challenges, delinquency remained a major concern as Barbadians continued to multiply their debt.

However, Holder gave the assurance that the delinquency levels were being managed adequately since members were being more upfront with their financial situation and their inability to repay in a timely manner.

“Right now our major concern is delinquency which we are trying to manage by offering people restructuring of facilities. In spite of the prevailing economic conditions, which are a little unstable at the moment, we still think that we do a good job in managing and controlling any eventualities,” the credit union executive told reporters today on the sidelines of the opening of a new branch of the BPWCCU in Mile & A Quarter in St Peter.

“They are being proactive. Once upon a time there was a certain stigma associated with falling unto hard times, but people are now coming forward and saying, ‘I am having difficulties with handling my debt so I need some help’. We are having more opportunities to consolidate debt because people are borrowing from other institutions as well. So we are taking advantage of that and consolidating and putting people on a firmer footing,” he reported, although he could not immediately disclose the level of delinquency at the credit union.

The BPWCCU boasts assets of just over $1.1 billion and a membership of just over 84,000.

The 2016 Financial Stability Report released in March this year, showed that the entire financial system remained stable with “extremely high levels of liquidity”.

As at September 2016 total assets in the financial system stood at $24 billion, a growth of about 4.5 per cent, or $805 million, when compared to the same period the previous year.

Of that amount, eight per cent was held by credit unions, 55 per cent by commercial banks, 13 per cent by insurance companies, nine per cent in mutual funds and the remainder was held in finance and trust.

That report also pointed to an overall decline of 9.4 per cent in non-performing loans (NPL) – an area of concern particularly for local credit unions –  with the majority of them concentrated in mortgages.

The report said the sector continued to make progress with respect for provisions for NPLs, which at the time was 33.4 per cent of overall NPL in the financial system.

Notwithstanding the high levels of delinquency, Holder said Barbadians continued to save and were “being more cautious with their money.

“They are making some investments. I guess they are waiting to see how they will ride over the economic period or the volatility that is going on at this point. So we are finding that our deposits are going up at this point,” said Holder, who also reported that the BPWCCU had seen an uptick in membership following the lowering of interest rates by commercial banks at the beginning of this year.

The credit union official said a decision was taken to open the small branch in response to numerous calls from residents in the north of the island.

The new location will have six staff members and brings to four, the number of BPWCCU branches. The total staff complement is just over 220.

“The demand in the northern side of the island was great. We wanted to service our members in St Andrew, St Lucy, St Peter and St James. They have been calling for it for a long time and we decided that it would be a good focal point for us to start.

“Of course Mile & A Quarter is a hub for all of those parishes, including St Joseph. This is a good thoroughfare and we believe it will do well,” Holder said.

9 Responses to ‘Bajans having a hard time repaying their debts’

  1. Epaphras D. Williams
    Epaphras D. Williams August 24, 2017 at 2:41 am

    When smart people fall into trouble repaying debt, they look around the house/yard for stuff to sell. A good name is priceless

    Reply
  2. Veroniva Boyce
    Veroniva Boyce August 24, 2017 at 3:39 am

    At least the borrowers are making the right decision to admit they’re in financial difficulty and need help. If they make an effort to make half the monthly repayments, once agreed by the bank or credit, that’s the first step in taking responsibility instead of ignoring and sweeping the issue under Mount Carpet.
    Live within one’s means, forget about keeping up with the Jones.

    Reply
  3. Ibukunoluwa Ayanfe Ozioma
    Ibukunoluwa Ayanfe Ozioma August 24, 2017 at 4:29 am

    It’s the same all over the world!

    Reply
  4. Wendy Reece
    Wendy Reece August 24, 2017 at 5:38 am

    Not just bajans thousands of people all over the world can’t pay off their debts. Welcome to the club.

    Reply
  5. Amelia Gittens
    Amelia Gittens August 24, 2017 at 9:48 am

    thanks for thinking about us in the north save me a big humbug trip to else where and my son who is now to age to do his own transactions on his own he can go a stone throw away, hard times not now every since just that its being more visual now ppl crying out louder and just running themeselves in more debt, but sometimes I wonder if the real debt is really on important stuff and not material things that not important

    Reply
  6. Anthony Prescott August 24, 2017 at 10:31 am

    Sometimes its the “want” factor that gets people into trouble. We are “supposed” to cater for our needs. But also its the fact that salary increases are also minimised and cost of living rocketting. No1 can keep up these days and yet in the developed nations things are 3 x cheaper than here.

    Reply
  7. Michael Crichlow
    Michael Crichlow August 24, 2017 at 10:32 am

    Globally it is the new normal

    Reply
  8. kathy-Ann Clarke August 24, 2017 at 2:25 pm

    Not only here, all over.

    Reply
  9. Belfast August 25, 2017 at 12:09 am

    And we have political yard fowls who come on the call-in shows and labelled these hardships being experienced by these unfortunate people as BLP Propaganda.

    Reply

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