Micro-business sector dominated by women — DBJ

Sunday, February 10, 2019

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A study commissioned by the Development Bank of Jamaica (DBJ) has revealed that Jamaica's micro business sector is now dominated by women with high-school education.

The impact study, which was conducted by the University of the West Indies-owned, LUMIN Consulting also showed that more middle-aged women operate their own businesses, with the largest portion of them being traders.

Despite the majority having secondary level education, the DBJ noted that females are “better educated than expected”. The institution also seemed pleasantly surprised that there are fewer millennial entrepreneurs than previously thought.

“The study also found that few of them [senior females] utilised E-bill payments, wire transfers and mobile money, although younger entrepreneurs adopted such services more readily,” the development finance institution said.

According to the DBJ, the impact study was conducted through five survey instruments and included 532 people, with an average age of 46.7 years. Eighteen per cent of the group was over 60. Two-thirds of the group were women. The survey also found that 72 per cent of the group had a relationship with a financial institution and that women borrowed more than men.

Traders dominated, with 35 per cent being in retail and 4 per cent in wholesale. Personal services represented 20.6 per cent, while farming was 16 per cent.

The impact study was an important component of DBJ's Financial Empowerment and Technological Awareness project which targets 2,500 micro-entrepreneurs to focus on financial literacy as well as raising awareness and understanding of mobile money and other forms of electronic retail payment services.

DBJ noted that its My Money training delivered 12 workshops and 13 seminars successfully across nine parishes to 2,100 participants. LUMIN was responsible for measuring the financial literacy and behaviour of participants both before and after the training.

“The findings of the study will provide the DBJ with important information which can be utilised to inform how we design our loan products and capacity building services for the sector,” said Paul Chin, the DBJ's general Manager of Micro Finance Services.

When measured against a cohort that was not part of the workshops, the group showed increased understanding about borrowing. however, the statistics showed that their borrowing had decreased.

“Surprisingly, there was no real increase in this group in operating bank accounts, and some of them cut back slightly on giving credit to customers. According to the study, their financial situation does not seem to have become more positive, nor are they using financial services, such as ATMs, more.

The DBJ introduced a microfinance policy in 2009 after it realised how many business owners in that sector were unbanked. In 2015, it rescoped an earlier project and refocused its efforts to improve the capacity of micro-entrepreneurs, raise their awareness and to increase the efficiency of microfinance institutions in technology services. FETA is the rescoped project that is working to address some gaps and issues that its research has identified.


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