Microcredit Act to be Tabled Within 12 Months

Finance and the Public Service Minister, Dr. the Hon. Nigel Clarke, says the proposed Microcredit Act will be tabled in Parliament within the next 12 months.

He noted that the legislation remains a high priority for the Administration, and aims to register and license microlending institutions that provide financing to micro, small and medium-sized enterprises (MSMEs).

It also seeks to enable greater participation of MSMEs in government contracts, while facilitating consumer protection.

“We are seized of the importance of the Microcredit Act. We have (several) pieces of legislation, of which the Microcredit Act is an important component, that we intend to table in the House of Parliament. I can definitely give you the assurance… (that) the Microcredit Act will be tabled… over the next 12 months,” he said.

Dr. Clarke, who was speaking at the National Financial Inclusion Strategy Forum at the Terra Nova All-Suite Hotel, St. Andrew on Friday (July 27), informed that the Finance Ministry has been working closely with the Attorney General’s Chambers, Bank of Jamaica, and Office of the Chief Parliamentary Counsel to develop the legislation.

He said he receives weekly updates on the progress of work on the legislation, adding that the latest was on Wednesday (July 25).

He noted that several drafts have been developed because “we have to make sure that when it is tabled, all of the kinks are ironed out and the companion pieces of legislation that the amendments affect… are also adjusted”.

Meanwhile, Dr. Clarke said the Government is leveraging stakeholder partnerships to further boost support for MSMEs.

He argued that as the Administration seeks to expand economic opportunity for all Jamaicans, it is imperative to foster a financial system that incentivises informal businesses to formalise their operations.

He noted that with more than 97 per cent of companies providing goods and services in Jamaica classified as MSMEs, these businesses generate significant employment and economic activity.

He said, however, that MSMEs often encounter myriad challenges, ranging from high levels of business informality, difficulty in accessing capital, and issues relating to the availability of suitable and adequate collateral for borrowing.

“If we want to have a dynamic economy that is characterised by sustained and increasing levels of economic activity, our polices have to be geared towards things that can make that segment of our economy thrive,” Dr. Clarke pointed out.

The Government of Jamaica’s National Financial Inclusion Strategy, which was launched in March 2017, is an ambitious portfolio of project activities designed to empower Jamaicans financially, through improved access to financial information and products to meet their needs.

Dr. Clarke chairs the National Financial Inclusion Council.