Financial Infrastructure

Financial infrastructure is the underlying foundation of Belize’s financial system and encompasses the existing legal and regulatory framework for financial sector operations.

Financial infrastructure allows effective operation of financial intermediaries. It promotes financial market growth and competition, which leads to more efficient allocation of funds and more options for consumers. The Bank is focusing on developing these key financial infrastructure elements:

• Payment, securities settlement and remittance system
• Credit bureau
• Collateral registries

Financial Infrastructure Reform
Financial infrastructure supports every formal financial transaction from paying a bill, to buying a house, to saving for retirement. Credit bureaus, collateral registries, and payment, remittance, and securities settlement systems are all vital parts of a country’s financial infrastructure. The Bank is developing these key elements to facilitate greater access to finance, improve transparency and governance, as well as safeguard financial stability. Benefits of this reform include:

• Financial stability - The level of development of financial infrastructure is closely correlated with financial system soundness. By improving the security and efficiency of the system and protecting investors’ and creditors’ rights, financial infrastructure promotes stability.
• Access to finance - Financial infrastructure provides the framework for growth of the financial system and is critical for improving access to finance. Reforming our financial infrastructure can reduce transaction costs, allowing private lenders to serve more people, profitably.
• Lower cost of intermediation - Efficiency gains will be especially evident in the case of an automated  payments system underpinned by a robust legal and regulatory framework, as lower operating costs gained from reducing manual processes translates to lower transaction costs.  The introduction of credit bureaus and/or credit scoring, along with a collateral registry, should foster financial inclusion with improved credit analysis, collateral security, and increased access to credit.