Call to form post bank

An economist has called for credit unions and the local postal service to join forces to create a “post bank”.

Ryan Straughn, a former president of the Barbados Economic Society, made the bold proposal as he delivered the Eighth Tom Adams Memorial Lecture at the Barbados Workers’ Union Hugh Springer Auditorium, Harmony Hall, St Michael on Tuesday.

The Postal Service possessed the network and infrastructure, while credit unions had a large membership base and more than $2 billion in assets that could be used in more ways, he advanced.

Straughn who is the Barbados Labour Party’s (BLP) candidate in Christ Church East Central, said the ideas represented necessary changes required for the changing times.

Speaking on the theme, Transforming Barbados’ Economy in an Increasingly Uncertain World: Lessons from Tom Adams for the 21st Century, Straughn said the island’s 33 credit unions with 188 227 members hold $2.076 billion in savings and should join forces with the postal service to “form a new financial institution” that could offer a broader range of financial services than currently exists.

The financial consultant and former economic modeler with the Central Bank called for an “unleash of the might of the credit union movement”.

And with increasing calls for the reintroduction of a development bank and for credit unions to form their own bank, Straughn insisted now was the time for the creation of a ‘post bank’.

“The assets currently held by the Post Office could be better utilized to deliver a broader range of services to citizens outside the current offering by the commercial banks,” he suggested.

“This deployment of much needed capital will partly finance the economic recovery effort that Barbados needs,” he said.

In this concept of the ‘post bank’ Straughn envisioned postal workers with upgraded skills working with credit unions to revolutionize “the financial landscape not only with its product offering but its ownership structure would be completely Barbadian”.

Recently, Postmaster General Margaret Ashby, said the institution which has been serving the island since 1852, was “being forced to compete in an unregulated market”.

She added: “The Post Office continues to struggle to maintain its universal service obligations with no similar contribution from other players within the market”.

Straughn suggested the ‘post bank’ concept would cater to traditional practices of working-class Barbadians such as meeting turns.

“I would like to see the reintroduction of the meeting turn which women have traditionally used to finance household operations.”

Straughn said a more formalised meeting turn would carry “a few enhancements”.

“Instead of the usual lump sum payment at every ‘turn’, we can deliver retail investment if the post bank organised digital meeting turns so that any Barbadian can buy in,” the economist suggested.

He proposed that when a person’s ‘turn’ came, their payment could be redirected into any financial instrument of their choice.

“We must make it easy for Barbadians to do business in this country . . .  [and] invest without compromising their rights as shareholders or small investors.

“The pooling of funds in this manner can be directed to start-up companies, stocks, bonds or other securities,” he told the audience, adding that the investments should be easy to liquidate in the event a person needed cash urgently.

With his proposal, Straughn said, “the small man will be at the table”.

Source: by George Alleyne

7 Responses to Call to form post bank

  1. Charming Forde
    Charming Forde October 14, 2017 at 10:43 am

    Really?

    Reply
  2. Mark Adamson October 15, 2017 at 8:29 am

    What staggering and putrid nonsense!!

    This so-called proposal is clear and patent evidence of the intellectual and political backwardness, bankruptcy, decrepitude, and discreditness that now drenches the BLP.

    This idiocy does not even constitute a coherent, consistent, intergated, farreaching, forwardlooking alternative.

    Indeed, it is no alternative whatsoever.

    Three reasons why this abject nonsense must be rejected by ALL and SUNDRY.

    1) The Barbados Postal Service is a government run public service. Credit unions are cooperatives (owned by the members of them). The post service have been founded for entirely different reasons than those reasons upon which credit unions have been founded. The genetic structures of both are entirely dissimilar. Straughn’s crudity renders the messy depiction of an attempt to breed a dog with a duck.

    2) The Barbados Postal Service is not a client based organization providing personalized services and therefore it is not a good and viable prospect for introjection into the financial market system. Credit Unions are not into the business of professional help management services ( the central operating notion behind modern government) and therefore are not ideal for any identification as a potential merger into a public service functionary. Postal Officers’ central focus is on delivering mail and packets from and to households, businesses and government departments locally and from local people to overseas people and from the latter to the former. Postal officers simply make sure that such properties are passed on. Credit unions activities are not only client based but are also personalized reaching as far into getting information on certain aspects of the members personal business affairs. Credit unions handle and keep in custody the financial properties of its members. There are no synergies between the two forms of organizations here.

    3) Credit Union members essentially fund the REVENUES of the persons who work or do business with credit unions. The local core financial system – inclusive of the credit union movement – fund the TRANSFERS of postal officers of the Barbados Postal Service. Whereas persons who work or do business with credit unions EARN their own REVENUES, postal officers do not EARN their RECEIPTS. The regressive financial status of the BARBADOS POSTAL SERVICE would be such a tremendous burden on the functioning of the Credit Union Movement were they to be merged, that Straughn idea would be worth pursuing.

    Like many government ministers who make official public addresses wheresoever and at whatever times – and who – at the same time of delivering such – fail to resist the temptation to come with up some vague, preposterous and unstudied ideas and proposals, simply because they think they need to say somethings attractive or important, Straughn was not only found to have been unable to resist such a temptation at what was supposed to have been a distinguished lecture, but also – as is his custom – he was found to have delivered himself of very poor and crude conceptual imagination and thinking.

    It is clear once more why Straughn – who loves wearing Western style suits that do not suit him – must not be elected at the next election in this country.

    Reply
    • Haskell Murray October 16, 2017 at 6:37 pm

      Sometimes I wonder where these economist got their degrees from. This is the most nonsensical idea any body could put forward .
      The post office has one shareholder , that is the government of Barbados , so Ryan you your reasons for the merger makes absolutely no sense.
      Mark Adamson has clearly stated the reasons why your idea is nonsense.

      Reply
  3. Mark Adamson October 15, 2017 at 8:32 am

    Final line, third paragraph – it ought to have been “that Straughn idea would not be worth pursuing”.

    Reply
  4. Patrick October 15, 2017 at 12:04 pm

    Another big talking economist looking for a job, what successful enterprise this man has ever run?

    Reply
  5. Belfast October 15, 2017 at 4:57 pm

    Then sell it to the Trinis , a la Barbados National Bank which morphed out of the Barbados Government Saving Bank.
    But how many Barbadians are will to put their money in the hands of the present administration, who will probably appoint a much PM trusted man like Leroy Parris to head the bank.

    Reply
  6. Nathaniel Samuels October 16, 2017 at 3:18 pm

    Adamson, this is way outside your level of thought. Just run in the next election and let us see what our people think of your candidacy. I’m sure that you and your team will provide the next government with its start-up funds.

    Reply

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