Financial Crime World

Banking Industry Compliance Challenges Persist in Haiti, Despite Efforts to Improve Payment Systems

The Haitian banking industry continues to face challenges in compliance, despite efforts to improve its payment systems and increase financial inclusion.

Cash Remains the Most Widely Used Form of Payment

Cash remains the most widely used form of payment in Haiti, with debit cards and credit cards accepted by established businesses. However, the country’s national payment system is more complex than that, comprising five additional methods:

  • Checks
  • The Haitian Interbank Payment System (SPIH)
  • Bank cards
  • Mobile phone payments

The SPIH, which allows for real-time transactions between commercial bank accounts through the Haitian Central Bank (BRH), has gained popularity among businesses and individuals due to its traceability and safety. The system is used by two major banking institutions, Unibank and SOGEBANK, which operate ATM machines across the country.

Efforts to Increase Financial Inclusion

In a move aimed at increasing financial inclusion and improving customer convenience, the BRH announced in 2020 that it would interconnect the ATM systems of major banks, including Unibank, SOGEBANK, Capital Bank, and cooperatives. This allows debit card holders to withdraw cash from any ATM bearing the “PRONAP” logo.

Challenges Remain

Despite these efforts, foreign exchange controls remain a challenge for the banking industry in Haiti. The government does not impose restrictions on the inflow or outflow of capital, but there are no local correspondent banks, making it difficult for international transactions to be processed efficiently.

Additionally, the lack of predictability and wide fluctuation in the Haitian gourde (HTG) has also shaken confidence among export-oriented investors. The currency experienced a 13 percent appreciation during FY22-23, following an 11.2 percent depreciation in calendar year 2021.

Government Efforts to Address Challenges

To address these challenges, the Government of Haiti has expressed its intention to implement stricter measures to monitor money transfers, in line with its efforts to deter illicit cash flows and comply with international anti-money laundering regulations.

Recommendations for Foreign Investors

For foreign investors looking to do business in Haiti, understanding the country’s banking industry compliance challenges is crucial. The U.S. bank Citibank is the only major international financial institution operating in Haiti, primarily serving corporate accounts. Further information on financing options in Haiti can be found in the country’s Investment Climate Statement 2023.

Note: This article has been rewritten in markdown format with headings, subheadings, and bullet points for easier reading and understanding.