Al Edwards,
Business Co-ordinator
LOCAL FINANCE house Dehring Bunting & Golding (DB&G) Mer-chant Bank is offering a range of new products in an effort to attract the more long-term saver.
In November of last year, it rolled out its "A" Account, a tax- free facility denominated in US dollars only. This targets non-residents and deposits must be derived from sources outside of Jamaica. The minimum permitted balance is US$1,000 and it has deposit periods of 90,180 and 366 days.
DB&G's Mercant Bank's General Manager, Tanya Ho-Shue, speaking to Sunday Business outlined some of the features of the "A" Account.
"We would like to encourage people who have access to US dollars to invest and save in that currency. This is our way of attracting savers to Jamaica who may have lived here before, for example Jamaicans living abroad. But let's not forget non- Jamaicans who might see the benefit of earning high interest on their money here as opposed to where they reside. What are those benefits? Well it is tax-free to them as non-residents and they get higher interest rates.
"To qualify for this account funds must be generated from abroad, therefore if it is a cheque it must be drawn from a foreign bank or funds can be wired from abroad. We need proof of non- residency, for example a passport, a bill, utility or otherwise, an alien registration card any proof or evidence that the person in question resides overseas."
The "B" Account is denominated in J$ only and is aimed at both residents and non-residents of Jamaica. The minimum deposit period is for 366 days and no withholding tax is applied. The permitted minimum balance here is J$50,000 and deposits must be derived from sources outside of Jamaica.
This account is aimed at among others, those who receive remittances, pensioners and ex-patriates.
LEAP YEAR ACCOUNT
The US$ Leap Year Account is a taxable account denominated in US dollars only which Jamaican residents can access. The minimum permitted balance is US$1,000 with a deposit period of a minimum of 366 days. What makes this particular account attractive is that there is no reserve therefore it offers better rates. "We are encouraging people to save for longer periods and break out of the 30 and 60 day periods which is a very short term. There is a benefit in putting your money on 366 days as opposed to 365 because it requires less reserves and so we can offer better rates.
"I would like to increase my customer base in terms of volume. By the end of this calendar year we are anticipating netting about US$500,000 a month and that is being conservative. The plan is to market these products very aggressively. I must add that very few merchant banks offer these accounts and one has to be approved by the Bank of Jamaica before they can do so. One must remember that you are being authorised not to withhold tax at source so one needs approval by the BoJ under the Income Tax Act. Eventually we will be offering these accounts in other currencies".
Among loans offered are those through the Development Bank of Jamaica and loans through the Export-Import Bank.
