Jamaican PM Portia Simpson Miller Seeks Inclusion Revolution

Portia Simpson Miller

Caribbean financial institutions need to shift their policies to help integrate the majority of the population into the formal economy, says Prime Minister Portia Simpson Miller.

Regional financial institutions need to design programmes which will maximise the involvement of excluded sectors of the public into the formal activities of our countries, the Prime Minister said. She was addressing the 39th Conference of the Caribbean Association of Banks (CAB), at the ultra-modern Montego Bay Convention Centre on Thursday, November 15.

“If our indigenous institutions are deserving of special emphasis and attention, there is greater need for them to recalibrate their policies and programmes to address the specific needs of our population,” Mrs. Simpson Miller said.

More than one third of the population of Jamaica is estimated to be outside of the tax system, and such levels are high throughout the region, the Prime Minister stated. She declared that this group needs to be “brought into the fold” for taxation equity, and also for them to get benefits when programmes are organised to serve the public.

The passage of Hurricane Sandy reinforced the need for some form of national insurance to address the resource requirements for national reconstruction, she stated. “The tragic fact is that the majority of persons who suffered damage had no such insurance.”

Few countries can make contingency provisions in their budgets to take care of such eventualities, Prime Minister Simpson Miller said. “My call is for our indigenous financial institutions, to apply their minds at both the regional and national levels, to the development of insurance schemes, which can assist those of your clients who presently have no formal (taxation) link.”

Earl Jarrett, General Manager of Jamaica National Building Society, pointed to the introduction of new mobile banking policies, which could support the provision of financial services to financially underserved communities across the Caribbean.

The priority focus on wealthy clients, service delivery costs for hinterland communities, along with customer identification efforts to tackle money laundering, all create barriers to financial services reaching certain rural areas, Mr. Jarrett said. Speaking about “The Importance of Financial Inclusion and Literacy,” he asserted that the provision of financial services through cell phones can ensure that such communities are supported.

“A quick review of the Mobile Payment Policy in Jamaica gives a glimpse of the future,” the building society GM stated. “The policy will soon enable bank agents to be established across the island.”

This policy is an essential component in the development of mobile commerce, as it forms the basis on which point-of-sale terminals will be established in rural areas, he pointed out. These can provide residents with facilities to deposit and withdraw cash, along with other financial services, using mobile wallets.

The traditional providers of financial services are clustered in central geographic locations, so most of the public remain underserved or not served at all, Mr. Jarrett stated.

Just about 12 per cent of the Jamaican population owns the types of bank accounts which allow for the transfer money, writing cheques or making credit card payments, according to a survey, commissioned by Solutions for Society, a Think Tank of The University of the West Indies. Outlining the survey findings in December, Texas-based Economist Dr. Dawn Elliott, said that most Jamaicans are restricted to using cash when making payments.

“Today, the region is on the cusp of a potential revolution in banking,” Mr. Jarrett affirmed. “This could result in full inclusion for the financial sector.”

One of the largest conferences in the organisation’s history, the CAB conference was attended by 450 delegates of its Caribbean regional members, and representatives from extra-regional financial institutions and service providers in Canada, India, the Netherlands, Nigeria, the United Kingdom and the United States of America.