KINGSTON, Jamaica – Roy Megarry, a former director of the island’s largest microfinance institution, JN Small Business Loans Limited (JNSBL), says Jamaica’s financial sector needs to accept small and micro-businesses as good credit risks,
The former publisher of The Globe and Mail newspaper, one of Canada’s largest and most authoritative newspapers, Mr. Megarry was speaking at a luncheon hosted by JNSBL in his honour, at the Terra Nova All Suites Hotel in St. Andrew, on April 30.
The most recent survey of living conditions conducted in the island in 2009 by the Planning Institute of Jamaica shows that 16.5 percent of the population is poor. Mr. Megarry declared that the development of small businesses offers the best strategy for fighting poverty.
“They are not bad credit risks and we prove that time and time again,” Mr. Megarry declared. He pointed out that JNSBL has less than five percent of its loan portfolio at risk, which is a lower level than the average for commercial banks in Jamaica.
Roy Megarry, a former Director of JN Small Business Loans Limited and Founder of the Canadian-based Tools for Development
“Not even the Royal Bank of Canada has that kind of delinquency rate,” he maintained, adding that most micro entrepreneurs repay loans so that they may borrow again to continue to build their enterprises. He said there is a perception that micro-businesses are bad credit risks, “because there is so much poverty around them.”
The founder of Tools for Development, a Canada-based philanthropic institution which sources and provides used equipment to small and micro businesses in Latin America and the Caribbean, Mr. Megarry says Jamaica needs to take its small businesses sector more seriously.
Pointing to a JNSBL commissioned market survey showing the existence of some 460,000 small businesses in Jamaica, he declared that micro business development is the country’s best anti-poverty weapon.
“Ninety percent of all the new jobs in the United States of America and Canada are created by small businesses,” he said. “We have to take it seriously.”
For every one person who receives a small business loan, five people benefit, he stated. With a population of 2.7 million people in Jamaica, he said that improving access to micro-business loans could substantially boost Jamaica’s economic development.
“Take the ‘five by five vision’ of getting to 100,000 loans; and some 500,000 people are going to be impacted,” he said. “What other formula could we come up with that would benefit 500,000 people in a meaningful and material way?”
JN Small Business Loans Limited, which has operations in all 14 parishes across Jamaica, has facilitated the creation of more than 24,000 jobs since its establishment in October 2000.
