Association of Banks Believes Liquity Level will SUFfiCE FOR THE Economic Activity in Fiji
The Association of Banks in Fiji believes that liquidity level will suffice for the economic activity this year and the years to come if it is maintained.
In the recent economic review released by the Reserve Bank of Fiji (RBF) in January, banking system liquidity measured by the bank demand deposit is currently around $382.5 million.
SODELPA Opposition Member, Filipe Tuisawau raised the issue on the current liquidity suitability during the Submission to the Standing Committee on Economic Affairs on the RBF August 2017 – July 2018 Annual Report at the Parliament Complex yesterday.
Especially with the introduction of Electronic Funds Transfer at Point of Sale free chargers which was effective as of January 1. going up and the cost of doing business increases and investments goes down.
“If the liquidity situation remains stable we deem that the interest rate market will remain stable in years to come.”
Mr Ram added the Association of Banks is a professional institute their key objective is to communicate the implementation monetary and banking policies as determined by the Reserve Bank of Fiji.
SODELP Opposition Members, Inosi Kuridrani also raised the issue of the increased complaints against commercial banks as reports by the RBF increased by 6.5 per cent ANZ Fiji Country Head, Saud Minam responded that the number of customers increasing and the number of transactions as well which will gradually increase in that ratio. Fijians with a maximum combined salary of $100, 000 can apply for housing loans schemes for low income earners. According to Mr Ram, Government has allocated significant housing eligibility for low income earners of $60 million of which $15m is being utilised by the commercial banks. Speaking during the Submission to the Standing Committee on Economic Affairs on the RBF Aug 2017 – July 2018 Annual Report yesterday, Mr Ram said from a commercial scale the supply and demand in this segment is limited.
Mr Ram stated with the increase in the threshold this will provide a much better scope of people in terms of purchasing property.
“From a commercial scale we have provided home loans where customers are able to meet the eligibility of the housing initiative, unfortunately the demand and supply in this segment is very limited,” Mr Ram said. “This relates to the previous report where the policy framework that people who are earning a joint salary of $50,000 and over are in the market at the moment with the increasing value of land not everybody comprises in that segment
“We despite that commercial banks providing different types of incentives to enable low income earners to get a higher house including interest rate concession and interest rate concession
“Based on the Associations of Banks feedback to the Minister for Economy, Aiyaz Sayed-Khaiyum, we have provided and he has agreed to increase the threshold to $100, 000 in terms of joint salary earned. “Land and house prices in the market is really going up and I think with this initiative now adds more line to people who would want to buy a house.”