Users of ABMs Have Role to Play in Compliance to Service-Level Standards by DTIs

Users of automated banking machines (ABMs) will have a pivotal role to play in the process of compliance by deposit-taking institutions (DTIs) with the ABM Service-Level Standards recently introduced by the Bank of Jamaica (BOJ).

The Standards, which were issued on April 2, are guidelines for the operation of ABMs by BOJ-regulated DTIs.

The recently promulgated Standards address matters regarding the deployment of ABMs, accessibility and ease-of-use, availability of cash, ABM fees and charges, infrastructure maintenance and the management of disruptions, client safety and security, fraud minimisation, and financial education of ABM users.

Deputy Governor, BOJ, Dr. Jide Lewis, says the Banking Services Code of Conduct, issued in 2016, contains a provision for customers of DTIs who have service delivery concerns, including those related to issues detailed under the ABM Standards, to write to DTIs expressing those concerns and seeking redress.

Dr. Lewis, who has responsibility for the BOJ’s Financial Institutions Supervisory Division, encourages persons who make complaints to DTIs to ensure that they get all the requisite information from the institutions they write to, “so that you can follow up with them in relation to the specific concern(s) that you have”.

“If you haven’t received an adequate response, we have provided an email address, which is customer.complaints@boj.org.jm… [where] you can write directly to the Central Bank and you will receive a response directly from me on the matter,” he assures.

This mechanism complements the robust framework for monitoring the adherence of DTIs to the ABM Standards, which Dr. Lewis says is being implemented by the BOJ.

“Banks/DTIs are required, on a monthly basis, to submit to BOJ detailed information on the performance of each of their ABMs across their network. That information will cover things such as whether or not those ABMs were operational during the reporting period, the percentage of time they were non-operational, information around cash availability – how much cash it dispensed [and] received, and also, in terms of their recovery time, how long did it take for ABMs to be serviced in such a way that [they were] available to the public,” he outlines to JIS News.

Dr. Lewis indicates that this information will be aggregated and shared with the public on a monthly basis with a two-month lag.

A statement issued by the BOJ on the day the Standards were promulgated indicates that the DTIs have a nine-month transition period within which to bring themselves into conformity with all the new ABM guidelines.

Senior Deputy Governor, BOJ, Dr. Wayne Robinson, says the Central Bank deemed this timeline reasonable and a feasible window “for them (DTIs) to be in a position to start meeting the majority, if not all of the Standards”.

“This is a comprehensive set of reforms and it will take time for the banks to implement systems and procedures to address some of these issues. They have a number of measures in place already but it’s going to take time to implement a number of others,” he explains to JIS News.

Dr. Lewis also highlights provisions that exist under the Banking Services Act (BSA) to address non-compliance by DTIs after the nine-month transition period.

“At that point, what we will be doing is seeking to do detailed reviews of each DTI in relation to their adherence to the guidelines. If we find widespread non-adherence, they will come under increased supervisory scrutiny, which could include onsite examinations. We’ll be looking, not just at what we see onsite, but we will be using information that we have gleaned from the public to inform those reviews, where we review,” he shares.

The Deputy Governor says the BSA allows the Central Bank the latitude to effect certain actions where widespread non-compliance has been determined, noting that this falls in the area of safety and soundness.

“The BSA does allow us to, firstly, apply warnings to entities for them to address issues that are found in our onsite reviews. Secondly, it would allow us to issue directions to entities where we see widespread [non-adherence],” Dr. Lewis indicates.

He explains that widespread non-compliance may relate to, among other things, instances of weaknesses in internal control environments unearthed during reviews.

“So this is where they may have policies and procedures which are not being followed, or weakness in their governance,” the Deputy Governor outlines.

Dr. Lewis adds that if widespread non-functioning of ABMs is discovered, for example, “warnings, directions and follow-up actions will be taken”.

Dr. Robinson tells JIS News that the Standards were jointly developed by the BOJ and Financial Services Commission (FSC), with assistance provided by overseas market conduct experts.

This, he says, came against the background of challenges that customers of financial services have been experiencing in conveniently accessing cash from their banks, particularly through the ABMs network islandwide.

The Senior Deputy Governor points out that this development “came to a head” in 2023, “due to a confluence of factors”.

Among these factors, he shares, were security-related issues, including attacks on armoured security vehicles and teams, which created logistical issues with the timely restocking of ABMs; and vandalism of some machines.

“Consequently, what we have set out to do is to have a set of workable and, importantly, measurable service-level Standards, covering a range of customer-related issues. The Standards also seek to minimise fraud or risks or incidents of fraud. Importantly too, they also address issues relating to accessibility, particularly for the physically challenged,” Dr. Robinson outlines.

He adds, “They reflect a culmination of a series of consultations with members of the Jamaica Bankers Association.”

Dr. Robinson points out that the BOJ has been seeing improvements, noting that “a number of banks have met the benchmark for the number of ABMs in operation and also met the benchmark, in terms of the uptime”.

“So, the Standards are very comprehensive and seek to address both critical pain points and, importantly, they seek to improve the customer experience,” Dr. Robinson underscores, adding that the DTIs have been “very supportive” of the guidelines.

The guidelines are contained in a document: ‘Minimum Automated Banking Machines Service-Level Standards to Strengthen Consumer Protection for Customers of Deposit-Taking Institutions’, which has been published on the BOJ’s website – www.boj.org.jm.