The Bahamas: Payment Landscape for Businesses
The Bahamas has a tourism-driven economy with financial infrastructure concentrated in Nassau and major tourist islands. This overview covers the payment ecosystem, regulations, and practical considerations for businesses operating across the archipelago.
Payment Infrastructure Overview
The Bahamas' financial system is regulated by the Central Bank of The Bahamas (CBOB), which oversees monetary policy, banking supervision, and payment systems.
Banking sector: Major banks include Commonwealth Bank, Bank of The Bahamas, FirstCaribbean International Bank, and Scotiabank. Banking services are concentrated in Nassau with limited presence on Family Islands.
Card networks: Visa and Mastercard are widely accepted in tourist areas. American Express has moderate acceptance. Debit card usage is common among residents.
Sand Dollar: The Bahamas launched the Sand Dollar, a central bank digital currency (CBDC), making it one of the first countries with a live CBDC. Adoption is growing.
Mobile payments: Banks offer mobile banking apps. Digital payment adoption is increasing.
Currency and Exchange
Currency: Bahamian Dollar (BSD)
Exchange rate: Fixed peg to USD at 1:1. Both currencies circulate freely and are accepted interchangeably.
Foreign currency: USD is widely accepted throughout The Bahamas. The 1:1 peg eliminates exchange rate concerns for USD transactions.
Repatriation: Subject to Central Bank regulations. Exchange control requirements apply to certain transactions.
Business Registration Requirements
To accept electronic payments in The Bahamas, businesses typically need:
Business registration: Register with the Registrar General's Department for incorporated entities.
Business license: Obtain appropriate licenses from the relevant licensing authority.
Tax registration: Register with the Department of Inland Revenue. VAT applies to most goods and services.
Bank account: A business bank account is required for merchant services.
Merchant Services
POS terminals: Available from commercial banks. Availability may be limited on Family Islands. Monthly fees and transaction charges apply.
Mobile terminals: Useful for businesses operating at beaches, docks, or multiple locations.
Online payments: International processors serve businesses with appropriate setup.
Payment links: Services like HandyPay enable card acceptance without traditional infrastructure, particularly useful for advance bookings.
Sand Dollar: Businesses can accept Sand Dollar payments through participating wallets.
Transaction Fees
Typical fee structures for card acceptance in The Bahamas:
| Payment Type | Fee Range |
|---|---|
| Local debit | 1.5% - 2.5% |
| Credit card | 2.5% - 3.5% |
| International card | 3% - 4% |
| Payment links | 2.9% - 3.5% |
Fees may be higher than regional averages due to market characteristics.
Regulatory Considerations
Anti-money laundering (AML): The Financial Intelligence Unit oversees AML compliance. The Bahamas has enhanced AML requirements given its international financial center status.
Data protection: The Data Protection Act governs personal information handling.
Consumer protection: The Consumer Protection Commission handles consumer matters.
Exchange control: The Central Bank administers exchange control regulations. Certain transactions require approval.
Settlement Times
Local transactions: Typically settle within 1-2 business days.
International cards: Settlement within 2-3 business days.
Bank transfers: 1-2 business days depending on banks involved.
Sand Dollar: Near-instant settlement between Sand Dollar wallets.
Common Business Types and Payment Needs
Tourism and hospitality: Dominant sector requiring robust international card acceptance. Advance booking payments essential.
Water sports and tours: Mobile payment solutions needed. Advance deposits common.
Retail: Card acceptance standard in Nassau and tourist areas. Cash more common on Family Islands.
Real estate and professional services: Bank transfers and international payments for high-value transactions.
Geographic Considerations
Nassau and Paradise Island: Full banking and payment infrastructure available.
Grand Bahama: Good infrastructure in Freeport area.
Family Islands: Limited banking presence. Internet connectivity varies. Cash more prevalent.
Cruise ports: High volume of quick transactions. Mobile and contactless payments valuable.
Resources
Central Bank of The Bahamas: centralbankbahamas.com
Registrar General's Department: Business registration
Department of Inland Revenue: Tax registration and VAT compliance
Sand Dollar: sanddollar.bs - CBDC information
Related Guides
- How to Accept Payments in The Bahamas
- How to Accept Payments in Jamaica
- How to Accept Payments in Trinidad
- Payment Links vs Payment Gateways