The Monetary Board announced that it has authorized the Central Bank to issue savings certificates for up to RD$5 billion, with the following terms: 30 days at 24%, 60 days at 25%, 90 days at 26%, 180 days at 27%, and 360 days at 28%. The certificates can be purchased at the headquarters of the Central Bank on Av. Pedro Henriquez Ure?a in Santo Domingo, and at the Central Bank?s regional office located off Autopista Duarte in Santiago.
President Hipolito Mejia explained on the ?Una vez a la Semana? weekly Sunday TV program that the money would be used to pay arrears on government debts.
The business sector opposes the placement, saying that it will only add to the rising cost of production in the Dominican Republic.
To purchase a certificate, a minimum deposit of RD$25,000 is required. Deposits are being received in cash, certified checks or bank checks. The Central Bank requires a cedula (Dominican ID card) to make the transaction, or a passport, if the person is a foreigner.
Reportedly, the certificates would remove money from circulation to restrain the depreciation of the peso.
An editorial in El Caribe newspaper says that the certificates present unfair competition to local banks, as they are being offered directly to the public and not through financial intermediaries.