Bank of PNG

BSP’s lending products that are linked to its ILR will reduce by 1% from 1 April, 2020, and other products such as its variable rate, Home Loan will reduce by 1% to 5.5%.

In a statement on March 31st, BSP CEO Robin Fleming said: “Our fixed rate loan products are treated slightly different to the variable rate. Our First Home Owner Housing Loan will remain at 4.00% pa fixed. New Personal Loans and New Smart Business Loans/SME Loans will have a 1% reduction in interest rate which in the case of Personal Loans will be 26%.”

The Bank of PNG will also make foreign currency available directly to the National Department of Health of urgent COVID-19 relocated purchases abroad.

This is among several monetary policy measure responses by the Central Bank to the impact of COVID-19.

Another key measure is the reduction of the Kina Facility Rate (KFR) from 5 percent to 3 percent which will push interest rates down.

Commercial Banks have been directed by the Central Bank to reduce their respective Indicator Lending rates (ILR).

Assistant Governor to the Bank of PNG, Ellison Pidik, said this recently when issuing 16 licensing certificates to Savings & Loans Society companies.

It was a milestones event as it was the first time in history that the Central Bank issued a high number of licences.

As part of the reforms under the new Savings and Loan Societies Act 2015, all existing societies are required to incorporate as a company and be issued a new licence to continue operating.

According to BPNG, the system will deliver efficiency, security and convenience in the National Payments System.

“The REPS will enable entry for financial institutions into the National Payments System (NPS) to offer plastic card and mobile payment services to their customers,” says BPNG.

“This will result in more people and businesses having access to financial services throughout the country, especially outside the main centres.

This is a digital software solution that allows all of the banks in PNG to connect to one another through the central bank.

Greg Pawson, Chief Executive Officer of Kina Bank, said: “The new switch is a game-changer for banking in PNG. It will lead to additional customer choice because it removes barriers to entry for smaller financial institutions who offer their own cards or EFTPOS and ATM services.”

The finding follows a review by the Bank of PNG and the International Finance Corporation (IFC), into financial services available to people in PNG, including financial consumer protection laws, financial service institutions and practices in PNG.

This had led to consultations between BPNG, IFC and financial institutions on the fair and equitable treatment of consumers who take out loans and access other financial services.

He said BPNG does not do banking for individuals and groups.

You see them meeting, almost every day, in groups around Port Moresby’s parks.

They are part of so called financial groups, which targets individuals to register and contribute certain capital, for that big ‘payout’- something many will not get.

Central Bank governor, Loi Bakani, on Friday warned the public of such scams and impersonators.

The Board, management and staff of BPNG said the handover of CDF building’s key, from contractors L&A Construction and Beacon Consulting, to the Bank comes at a time when the building is going through a fit-out program in preparation to be fully operational in the first quarter of 2019.

“To celebrate the milestone, the 220th Board meeting was held on 4 October in the boardroom of the newly completed building,” the BPNG said in a statement.

BPNG says these cryptocurrencies do not have any legal tender status to be accepted as a currency in PNG.

The Central Bank says investment in digital currencies such as bitcoin, ethereum, EOS or Litecoin is considered very risky and speculative in nature.

“People who invest in any of the cryptocurrencies do so at their own risk,” says BPNG Governor, Loi Bakani.

“There is no guarantee that cryptocurrencies will be accepted as a medium of exchange, or will hold their value.

This is attributed to improvements in commodity prices and higher production of most of PNG’s major exports, mainly from the mineral sector, contributing to higher growth in 2017, than the previous year.

This is stated in the Bank of PNG’s Quarterly Economic Bulletin for December 20017.

According to the report, this outcome is a result of higher surplus in the current account, which more than offset a deficit in the capital and financial account.