CBSI launches new automated transfer payment system

By Sharon Nanau

The Central Bank of Solomon Islands (CBSI) launched the Solomon Automated Transfer System (SOLATS) in Honiara on Monday.

Funded by Australia and New Zealand through the International Finance Corporation, a member of the World Bank, SOLATS is a real time gross settlement payment system that will increase efficiency and strengthen the security of the country’s financial system.

CBSI Governor Dr Luke Forau said SOLATS lays the foundation towards digitizing the country’s economy.

“SOLATS lays the foundation towards the digitalization of the Solomon Islands economy, it will create the conditions for banks and other financial institutions to offer new products and services.”

Mr Forau explained with the changes of technology, the country’s financial space needs to respond to these changes.

“While we have made successful strides in modernizing our legal framework, we are aware that the advent of modern technology has also brought about innovations in the payment landscape. With these innovations come new challenges, shaped by market requirements and developments, as our economies respond to new demands and opportunities.” 

The new system replaces the current manual transfer system between banks that heavily relied on cheques which led to delays in clearing funds and slowed down economic activities. 

Commercial Banks Representative and ANZ Solomon Islands Branch Country Head Martin Beattie said SOLATS marks a step forward in the country’s monetary system. 

He said SOLATS feature of doing payments instantly online will benefit both the banks and their customers.

“Payments are the lifeblood of the economy and to now know we can assist them in their payments up to 50 thousand dollars transferring in a matter of hours and those transferring above 50 thousand dollars within a matter of seconds represents a major leap forward in the monetary system in the Solomon Islands.”  

IFC Country Manager for Australia, New Zealand, Papua New Guinea, and the Pacific Islands Judith Green said developments in the country’s financial system will help boost financial inclusion and economic activity. 

“These transformative changes are crucial to help reduce poverty while boosting financial inclusion in economic activities, so IFC payment projects in the pacific aims to increase access to the financial services for the served and underserved population.” 

IFC is working with central banks and other partners across the Pacific to help create this transformative change. 

Australia’s Deputy High Commissioner to Solomon Islands Andrew Schloffel said the Australian government is proud to support the development in the country’s financial sector. 

“We are a strong supporter of the government’s efforts to build a more stable and strong economy.” 

The SOLATS project started in 2019 but was delayed due to the covid-19 pandemic. 

A survey carried out in 2015 shows that more than 30 percent of adults in Solomon Islands do not have a bank account and lack access to banking services which forces them to rely on cash.

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