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Jamaica’s Mobile Banking Thrust Gains Momentum

Jamaica’s Mobile Banking Thrust Gains Momentum
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KINGSTON, Jamaica – There is now a much deeper understanding of the key issues that need to be addressed to position Jamaica to take the best advantage of mobile financial services technology, says Dr. Maurice McNaughton, Director of the Centre of Excellence of the Mona School of Business (MSB).

“This insight leaves us both convinced of the enormous potential that the appropriate introduction of these technologies could have for Jamaica’s socio-economic circumstances, but also concerned that sub-optimal approaches may limit the scope of these benefits,” Dr. Mcnaughton said.

He pointed out that Carl Rosenquist, an international mobile phone payment systems consultant, has been working with Solutions for Society, a Think Tank at The University of the West Indies at Mona, and the MSB to establish a new approach to the development of mobile commerce in Jamaica. The consultation, which started in March, is a follow-up to the Mobile Financial Services Conference, which was held in Kingston last December.

Mobile Banking in Jamaica

“Jamaica is relatively late in contemplating the introduction of mobile financial services on a national scale, as compared with other countries in Africa, Asia and Latin America. It does give us the opportunity to learn from the mistakes made by some countries which developed mobile financial systems that could not make optimal use of their banking and telecommunications infrastructures,” Dr. McNaughton said. “This requires the active engagement of stakeholders at all levels, in order to realize the potential this technology offers.”

Mobile financial services use wireless handheld devices, such as mobile phones, to pay bills, do money transfers and traditional banking, and execute other transactions. Jamaica already has a very high cellular phone concentration, with more registered subscribers than the total population of the island, and also has a sophisticated financial services sector.

“What drives the choice of mobile payment systems architectures today is the potential customer base” stated Mr. Rosenquist. He believes that introducing a mobile financial system that can take advantage of Jamaica’s high telecommunications penetration and existing retail payments ecosystem, including ATMs, POS Merchants and Payment Cards provides the most significant commercial opportunity. Such a system is possible with the appropriate regulatory framework and interoperable mobile payment systems based on industry-standard interfaces with Jamaica’s existing banking infrastructure.

Access to Financial Services

Many Jamaicans now do not have effective access to financial services largely because it cannot be provided to them cost-effectively. This technology holds the promise of delivering financial services for the un-banked segment of the population with much greater coverage and transaction efficiencies, Dr. McNaughton pointed out. We are therefore conducting research as part of this undertaking that will provide an evidence-based estimate and demographic characterization of the “unbanked” segment of the Jamaican populace. This will be an important pre-requisite to modeling the overall macro-economic impact of mobile financial services and ultimately to inform the policy and strategy recommendations.

Mr. Rosenquist has been in Jamaica since March 14 for a series of consultations with policy makers, regulators and industry leaders in the financial and telecommunications sectors, which is expected to be concluded in May. His extensive experience in the sector includes SmartMoney in the Philippines, and wide-ranging consultancy and implementation engagements in various mobile phone payment systems around the world.

We expect to complete this engagement and study by early July, at which time we will host another seminar event to present and discuss with industry stakeholders what we expect to be quite significant and valuable findings.” Dr. McNaughton stated.

 

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