• JIS News

    Story Highlights

    • The Bank’s funding activities have helped to establish nine new companies, 850 new jobs
    • The DBJ has placed special emphasis on micro, small and medium sized enterprises
    • A healthy micro finance sector is a proven catalyst for national economic development

    Last year the Development Bank of Jamaica (DBJ) committed and disbursed over $1.2 billion to the Micro, Small and Medium Enterprise (MSME) sector, covering 200 small and medium sized business loans.

    The Bank’s funding activities have helped to establish nine new companies, 850 new jobs, and the maintenance of close to 7,000 existing jobs.

    Additionally, micro finance institutions on lent in excess of $225 million to over 4,000 micro entrepreneurs.

    Chairman of the DBJ, Joseph Matalon, disclosed these figures, as he addressed the media launch of the fifth annual Caribbean Micro Finance Forum, at the Bank’s Oxford Road offices in Kingston, on August 19.

    “In its mandate to foster economic growth and development of strategic sector of the economy, while facilitating the growth and development of all viable enterprise, the DBJ has placed special emphasis on micro, small and medium sized enterprises,” he noted.

    Mr. Matalon argued that the MSMEs and entrepreneurs are the primary engine in many instances for economic growth and job creation, but these sectors can do very little without appropriate financing.

    He emphasized the importance of micro financing, despite the proliferation of financial institutions across the Caribbean, many with international links.

    “Traditionally, larger financial institutions have not provided services to clients with little or no cash income. Often their (the institutions) calculations of profit and their break even points, preclude borrowers below a particular income level. The usual high rate of interest is also extremely prohibitive,” the Chairman said.

    However, he said the development of an active, healthy micro finance sector is a proven catalyst for the broader goal of national economic development, as satisfying the unmet demand on a larger scale, will play a more significant role in reducing poverty.

    Mr. Matalon noted that across the region, there is increasing provision of micro finance at more affordable rates, increased outreach to more people, including women and youth, and the development of a more aware, knowledgeable, and fiscally responsive micro finance sector.

    “Events like the Caribbean Micro Finance Forum is an excellent vehicle for sharing information from various stakeholders within the industry, including best practices and lessons learnt, while also contributing to a greater understanding of micro financing generally, in the Caribbean,” he pointed out.

    Mr. Matalon said the forum is timely, as the region is already enjoying gains fueled by a burgeoning micro financing industry, and is working to build on those successes economically and socially.

    The Chairman informed that since the launch of the Caribbean Capacity Building Microfinance Project II (CARIB-CAP II) last year, there have been in excess of 2,000 new loans disbursed to micro entrepreneurs, an increase from the 8,900 clients at the start of the project, with an average loan portfolio of US$5.5 million.

    This represents a 23 per cent growth as of June 2013. The survey was done among participating countries, including Jamaica, Belize, Grenada, St. Lucia, Trinidad and Tobago, Guyana and Suriname.

    Meanwhile, Country Representative, Inter-American Development Bank (IDB), Therese Turner-Jones, said the IDB sees the forum as an important step in the wider development process for Jamaica.

    She argued that putting emphasis on micro finance and improving access to credit for entrepreneurs is an important step in addressing the issue of unemployment.

    In his remarks, Charge d’Affaires, Delegation of the European Union, Cesar Valor Arge, expressed the EU’s commitment, stating that, “we see this as a powerful tool to develop micro finance.”

    The fifth annual Caribbean Micro Finance Forum is scheduled for November 4 to 7 in Paramaribo, Suriname, under the theme, ‘Building an Environment for Entrepreneurs to Excel’.

    The forum is a platform for micro finance entrepreneurs, practitioners, and other key industry interests to participate in creating a more developed microfinance industry in the English-speaking Caribbean. It seeks to do so by improving financial performance and outreach, as well as fostering micro finance knowledge sharing for the region.

    The forum will focus on ‘youth entrepreneurship’; ‘ecosystem for scalability and sustainability’; ‘farmer to entrepreneur – transforming the rural economy and technology’; and ‘innovating to respond’.