Guernsey’s reputation as a first-class finance industry is well-established. However, Chamber is concerned that there seems to be a disparity between that offering, and the range of services and products that are provided to local businesses. This is particularly acute for non-finance businesses.
In recent weeks, several local businesses that hold client money in pooled accounts such as estate agents, payroll services and others, who bank with NatWest are facing the withdrawal of their accounts, citing compliance with regulation as the reason.
Chamber say that they recognise and support the implementation of effective measures that ensure the safety of client funds while aligning with the overarching objective of combating money laundering. They acknowledge that pooled accounts pose more risk and therefore require more due diligence but with appropriate measures in place are permissible.
The average time taken to open a new business bank account is 16 weeks
The Chamber of Commerce is urging banks and business to work together to seize the opportunities for progress and ensure that Guernsey remains competitive. By identifying and removing barriers in banking services and payment platforms, a level playing field for all businesses can be fostered and encourage enterprise.
“At every point we hear deputies talk how we need to diversify industries, to attract new business to the islands and encourage start-ups but it can feel like the exact opposite in practical terms. We are supposed to be open for business, but we are not – we are introducing more and more barriers for those not in the finance industry,” said Diane de Garis, President of the Guernsey Chamber of Commerce. “It takes over 16 weeks to open an account, there is only one bank who offers credit cards and only a few banks have adopted open banking – and now this. It’s just not good enough. We need to create a level playing field for all businesses in Guernsey.”
The Chamber of Commerce is calling on banks to look at how they can streamline their account opening processes and reduce wait times to better serve the needs of the local business community, and in particular to work with businesses who have used pooled accounts to find a way to meet the regulatory needs as they play a significant part in Guernsey’s diverse economy.
Local business owners Andy and Julie Carré of Carré Property Limited said: “It is extremely worrying to receive a letter notifying us about the closure of our business accounts which have operated without any issues over the last 15 years. This creates immense challenges for our day-to-day operations. Our company is registered as a prescribed business with the Guernsey Financial Services Commission and has Client Money Protection insurance.
“What adds to the frustration is the realisation that it will be nearly impossible to open another account elsewhere within the limited timescale given. Why is Guernsey not being provided with the necessary support and assistance for our local businesses? We need solutions that enable us to thrive and contribute to the growth of our community and local businesses, and not be sending out messages that imply Guernsey is closed for business”.
To gain a comprehensive understanding of the challenges faced by local businesses in the banking sector, the Chamber of Commerce has launched a survey encouraging businesses to share their experiences. The survey aims to identify specific pain points and areas for improvement.
The Guernsey Chamber of Commerce is dedicated to addressing this issue and ensuring that the business community in Guernsey receives the best possible support and services.
Diane continued: “We shouldn’t need a charity, the Guernsey Community Savings, for those who are being excluded and can’t access basic financial services – and yet we do. We can and must do better for our local business and residents”.
Guernsey must adapt and evolve to support the growth and success of our local businesses.