DBJ Launches Pilot Project to Assist Micro Businesses

The Development Bank of Jamaica (DBJ) will, over the next 12 months, embark on the pilot phase of their latest initiative, the non-commercial Mobile Money for Microfinance Project, dubbed M3.

The venture, which was launched at the Jamaica Pegasus Hotel, New Kingston, on February 11, seeks to increase access to and security of financial service transactions and deliveries, particularly to microfinance sector stakeholders, at significantly reduced costs using mobile phones.

Developed over the last two years and approved by the Bank of Jamaica (BoJ), M3 will, among other things, enable clients to remotely access a bank account, primarily to check account balances and make payments; negotiate transfers from one person to another and carry out activities, such as person-to-business transactions and payments for goods and services.

Technology solutions firm, Transcel Limited, and National Commercial Bank (NCB), have partnered with the DBJ to execute the project. Transcel is providing the digital mobile network platform that will facilitate transactions.

The NCB will serve as the DBJ’s enabling partner by providing the deposit holding facility and setting up master accounts created by the latter to service mobile money micro accounts assigned to the micro finance institutions (MFI) clients and other participants which NCB will also manage.

Speaking at the launch, Managing Director of the DBJ, Milverton Reynolds, announced that the institution has provided some $1.55 billion for on-lending to microfinance clients who will be able to access loans with the assistance of the nine MFIs approved for participation in the pilot phase.

These include: Access Financial Company Limited; Micro Credit Limited; Jamaica National Small Business; St. Thomas Co-operative Credit Union Limited; First Heritage Co-operative Credit Union Limited; St. Elizabeth Co-operative Credit Union Limited; McKayla Financial Services Limited; First Union Financial Services Limited; and NationGrowth MicroFinance Limited.

Mr. Reynolds advised that on completion of the pilot, “the findings will be used as the basis for the development of policies, covering the operation of all aspects of mobile money (services) in Jamaica.”

Meanwhile, Industry, Investment and Commerce Minister, Hon. Anthony Hylton, welcomed the M3 initiative, describing it as “an excellent example of public-private partnership effort that reflects a shared vision of innovation and improving the business environment.”

He noted that “rapid changes” resulting from emerging developments in new mobile technology, and regulatory changes in global financial services, “have opened a window of opportunity for productivity enhancement innovations in the microfinance sector.”

“As the Ministry charged with responsibility for the micro, small and medium-size enterprise (MSME) sector…this project holds much significance and many possibilities for changing the way business is conducted, so as to improve the economics of money transaction operations,” the Minister said.

Mr. Hylton further argued that the attainment of sustained growth and job creation in Jamaica required a shared vision of the possibilities and the confidence that, “once we are able to establish viable partnerships, we will be able to implement significant benefits to end-consumers.”