THE BOTTOM- Saba threatens to reap the bitter fruits of changes in inter-island remittances. The Saba Business Association (SBA) raised the alarm about this on Friday.

According to SBA, there used to be a special rate for transactions between banks of the former Netherlands Antilles. Now that CBCS has introduced a new system with ‘real time’ transfers, the costs threaten to be higher.

This is because not all banks are yet affiliated with the new system, apparently including Royal Bank of Canada (RBC) on Saba. “The consequence of this is that from now on all transfers from or to the RBC account on Saba will suddenly go through the expensive international SWIFT system,” says SBA.

The association now wants to know whether it is not possible to apply a special inter-island rate for transfers to Saba. The SBA also wants to know why the RBC on Saba is not yet connected to the new system. Since the RBC has its headquarters on another island (in this case Sint Maarten, editors), this falls under the Central Bank of Curaçao and Sint Maarten.

A letter from SBA about the situation is now on its way to CBCS.

Vulnerable

The banking system on Saba is very vulnerable because only one bank is active on the island. The Windward Island Bank of the MCB group used to be active on the smallest BES island, but a few years ago the WIB called it quits. According to her, the income on the island did not outweigh the costs of keeping a branch open.

This means that residents of Saba are at the mercy of one single bank. Many Sabans have kept an account with the Windward Island Bank on Sint Maarten, but are now being hit extra hard because they have to pay international and much higher rates with every transfer from the RBC to the WIB, or vice versa.

The SBA says it has not yet received a response from CBCS.