BOJ to review draft code of conduct for MCIs

The Consumer Affairs Commission (CAC) says a Code of Conduct has been drafted to govern how microcredit institutions (MCIs) should operate under the Microcredit Act. 

The Microcredit Act, passed in 2021, will take effect in July. The Act aims to formulate procedures for the licensing and regulation of MCIs that provide financing to individuals and operators in the micro, small and medium-sized enterprises (MSMEs) sector.  

The CAC was named in the Microcredit Act as the agency responsible for investigating and handling all complaints made by consumers against MCIs. 

Speaking in an interview with JIS News, Chief Executive Officer, CAC, Dolsie Allen informed that the draft Code of Conduct has been submitted for review to the Bank of Jamaica (BOJ) which has the regulatory responsibility for the Act. 

“We are awaiting the feedback and as soon as we receive it, we will be reaching out to the major stakeholders to get their input,” said Mrs. Allen. 

The code of conduct, when finalised, will include the name, occupation and place of residence of the borrower; the business of the parties; the date on which the loan was made and disbursed; the loan amount; the terms of repayment and interest rate charges. 

“We want to ensure that persons are aware of what exactly is involved in this code. So, when we have this type of consultation, hopefully persons will buy in and they will sign off on it,” said Mrs. Allen,  

She further noted that the intention of the Code of Conduct is to minimise disputes.  

“We want an agreement; we don’t want to be imposing something on the microcredit institutions. We want it to be cooperation where both parties…sat and put something together that is going to be accepted by both sets of persons,” said Mrs. Allen, adding that at the end of the day, the CAC has a responsibility to protect consumers. 

Meanwhile, Dr. Blossom O’Meally Nelson, Co-Chairman, Joint Advocacy Committee, representing the micro finance sector, said the development of the Code of Conduct is welcomed by its members. 

She said that regulation of the sector is intended to raise the profile of the MCIs, thus putting them “on another level”. 

Mrs. O’Meally Nelson further indicated an interest in having regular meetings with the CAC to “pre-empt any developing trend” as well as to look “in depth at any complaints that our customers may be having”.