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Bank of Saipan introduces electronic payment of wages
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Posted on Feb 10 2000
An indication of brewing competition in the Northern Marianas financial sector, banking companies have started taking steps to further improve the way they transact business with clients, manifested by a new payment scheme introduced by Bank of Saipan.
The new electronic payment system cuts down time consuming processes faced by private companies, as well as the government, in preparing employee wages and other benefits.
According to Bank of Saipan chief operating officer Thomas D. Schoen, the company has started accepting Direct Deposit for all CNMI government employees, Social Security recipients and employers offering payroll allotment for their workers.
Under the Direct Deposit service, private companies can pay employee wages through Electronic Funds Transfer which virtually eliminates the hassle of writing checks.
The service allows employers to transfer the funds directly into the employee checking or savings account, thereby, resulting to savings in time and money since they do not have to process payroll checks on paydays.
“Since Direct Deposit replaces checks and cash, employers and employees will not have to worry about stolen checks or cash, and avoid the hassle of standing in line at the banks to make a deposit,” Mr. Schoen said.
Bank of Saipan had recently launched its own Automated Teller Machines service and has worked at securing membership from the largest financial institution in the United States — Federal Deposit Insurance Corporation (FDIC).
Bank of Saipan’s move came in response to the increasing volatility of the local financial sector, as well as to pacify worries of its private depositors since FDIC provides a more concrete assurance that their money is safe.
The move is expected to boost Bank of Saipan’s competitiveness and resilience, since affiliation with FDIC has been a major consideration among depositors and bank clients when choosing an institution because there is something to fall back on in case a bank goes bankrupt.
The bank’s decision to secure insurance from the FDIC would also bring the company at a playing field similar to off-island banks which are insured by the largest American financial institution.
