The Financial Institutions Act, CAP 324A is the legislation under which commercial banks, trust and finance companies, merchant banks, money or value transmission service providers, financial holding companies and foreign currency earning banks are licensed and administered in Barbados. This Act establishes the statutory requirements on such areas as licensing, capitalisation, reporting, and restrictions on banking activities.

The Fair Credit Reporting Act, 2021 is an Act to provide for a credit reporting system in Barbados that is fair, for the regulation of the use of data collected and for related purposes. Under this Act, the Bank is established as the regulator and supervisor of credit bureaux and is empowered to issue standards and targets regarding the provision of fair credit reporting services; institute proper standards of conduct and acceptable credit reporting practices; protect the integrity of the credit reporting system in Barbados against abuses; and take measures to protect the rights and interests of data subjects.

Electronic copies of the key legislation can be found at this link

https://www.centralbank.org.bb/legislation/legislation-1

The Bank uses a dual approach of ongoing off-site monitoring and site visits (onsite examinations) to assess various elements of a licensee’s operations. The off-site process incorporates analyses of monthly and quarterly prudential returns submitted by all entities and the processing of applications as required by law.  Onsite assessments are undertaken on such areas as corporate governance, operational risk management, information technology, anti-money laundering and terrorist financing, and regulatory reporting.

Lists of each type of entity regulated and supervised by the Bank can be found on the Bank’s website under the heading Licensed Financial Institutions

The Minister of Finance’s approval must be sought prior to the establishment of a financial institution in Barbados. An application for a licence must be completed and reviewed by the Bank. On satisfaction of all requirements, a recommendation is forwarded to the Minister of Finance for approval. Licences for credit bureaus are approved by the Bank.

Application packages, which provide the application forms and requirements, can be found on the Bank’s website

The Barbados Deposit Insurance Corporation (BDIC), established under the Deposit Insurance Act-29 of 2006, came into operation on June 8, 2007. The BDIC is administered by a Board, independent of the Central Bank of Barbados. The Bank is represented on the Board by the Governor and the Director of Bank Supervision.

The deposit insurance initial contribution and premium was set at 0.05% of the insurable deposits held by the member during the calendar year preceding the calendar year for which the premium is payable.

The Corporation manages the Deposit Insurance Fund, which was financed by an initial contribution and annual premiums from all member institutions. At present they are fourteen members of the Fund, six (6) commercial banks and eight (8) deposit taking financial institutions governed by the Financial Institutions Act. The Central Bank of Barbados matched the initial contribution payable by all member institutions.

The BDIC guarantees insurance coverage of up to $25,000 for depositors of commercial banks and other deposit taking financial institutions licensed under the Financial Institutions Act.

The establishment of this Fund was designed to extend the financial sector safety net and contribute to the maintenance of public confidence in deposit taking institutions in the financial sector.

There is a formal grouping of all domestic sector regulators that includes the Bank, the Financial Services Commissioner, Financial Intelligence Unit, and the International Business Unit, the Compliance Unit, and Corporate Affairs and Intellectual Property Office. Representatives from these agencies meet to discuss matters of mutual interest relative to the regulation and supervision of the local financial system.

Barbados is a member of the Caribbean Group of Banking Supervisors, the Group of International Financial Centers Supervisors, the Association of Supervisors of Banks of the Americas, and the Caribbean Financial Action Task Force.

The Bank has established memoranda of understanding to allow for information sharing, which is key to effective solo and consolidated supervision of banks that are part of a regional or international financial group.

The Bank is a member of the Anti-Money Laundering Authority.