JMMB Group seeks growth from SMEs
The JMMB Group wants to target the nearly-three-quarters of Jamaican businesses, that rely on financing from outside of the regulated financial sector.
More precisely, they are more likely to turn to moneylenders and microfinanciers, whose sector is unregulated but is soon to come under the umbrella of the central bank.
The interest charges on those loans range from 40 per cent per annum upwards – rates that are equivalent to credit card charges offered by banks.
“It is very expensive,” said JMMB Group CEO Keith Duncan. “Part of our financial inclusion strategy is to ensure that we can get affordable financing to those parties," he said in response to shareholder queries at the company’s annual general meeting on Thursday.
The financial conglomerate recently started offering commercial banking services through JMMB Bank in a market in which it and seven others hold commercial banking licences. The market however is dominated by National Commercial Bank and Scotiabank.
JMMB said it plans to target the unbanked and underbanked by offering them loans at lower rates.
"Where we have the opportunity is with the SMEs and the high rates offered to them. That is where we want to make a difference – but not only for the SMEs, but the micro borrowers who find it hard to get financing," Duncan said.
He said only 27 per cent of SMEs are banked through financial entities; that only 9 per cent of employed Jamaicans are contributing to pension funds; and 50 per cent of Jamaicans do not trust financial sector.
"This creates an opportunity for us. So we can do our research and then provide partnerships and grow," he said. "We believe JMMB is a brand that is trustworthy and we are going to grow the market, because if Jamaica wins, we win,” the JMMB Group boss said.
Looking ahead to 2018, Duncan said the group, which operates businesses in Jamaica, Dominican Republic and Trinidad & Tobago, aims to drive growth by focusing on the roll out of new banking centres, improving its online capabilities, adding more commercial banking services, and simplifying client solutions.