KINGSTON — A pilot project dubbed, ‘Mobile Money’ that seeks to enhance the operation of the micro-finance sector is to be introduced by the Development Bank of Jamaica (DBJ) this year, Prime Minister the Hon. Bruce Golding has announced.
Making his contribution to the 2011/12 Budget Debate in the House of Representatives, today, Mr. Golding informed that the DBJ has signed an agreement with a service provider that will see micro-enterprise operators accessing financial services via their cellular phones.
“It will reduce transaction costs with the micro-finance institutions enabling them to further reduce interest rates. The DBJ is awaiting the approval of the Bank of Jamaica,” he said.
Mr. Golding pointed out that micro-enterprises are an important source of economic activity, providing own-account employment for thousands of persons, lamenting that they are at the greatest disadvantage in securing loans through the commercial banking system for various reasons, including inadequate collateral and the lack of formal training or experience in business.
“We have sought to bridge that gap by way of special programmes offered through the DBJ. We established a special Micro Finance Lending Window and last year disbursed loans totalling $228.6 million to 4,215 micro-enterprise operators – an average loan amount of $54,000,” he said.
Mr. Golding noted that the DBJ provided a further $947 million in loans to 207 small and medium-size businesses, $351 million of which was disbursed to small farmers through the People’s Co-operative (PC) Banks.
“This year, the DBJ will be providing additional loan financing of $2.3 billion with a significant portion being earmarked for micro, small and medium size businesses,” he informed.
In the meantime, the Prime Minister stressed that the Government is seeking to facilitate more enterprising Jamaicans to establish businesses in the Information and Communications Technology (ICT)/Business-Process-Outsourcing sector, “which is making significant strides and has established its competitiveness."
“The DBJ will be providing a special line of credit of $1.7 billion to enable more Jamaicans to capitalise on the opportunities available in this sector,” he said.
By ALECIA SMITH, JIS Reporter