THE Jamaica Micro Financing Association (JaMFA) says it is pleased with the Government’s decision to pump an additional $1.4 billion into funding the growth and development of Micro, Small and Medium-Sized Enterprises (MSMEs) in Jamaica.

However, JaMFA says it is very concerned that, while the Government is seeking to create an environment that will facilitate growth and development of MSMEs, recent developments at the Ministry of Finance, in relation to microfinancing institutions (MFIs) renewing their exemptions under the ‘Money Lending Act’, will have serious negative effects on the sector.

“This is very worrying to the sector, as an exemption certificate from the Ministry of Finance and the Public Service is a main requirement for MFIs to access funds from the DBJ [Development Bank of Jamaica] to on-lend to the MSMEs. This situation, unless rectified, will defeat the minister and DBJ’s efforts to get much-needed funds to the MSMEs,” said JaMFA’s Executive Director Raymond Gabbidon.

Minister of Finance Dr Peter Phillips, recently announced an increase in funding for MSMEs by from its current $600 million to $2 billion, in recogntion of the significant roll MSMEs play in contributing to GDP.

Phillips pointed out that small businesses account for 88 per cent of all firms that file General Consumption Tax returns, represent half the country’s gross domestic product and employs 53 percent of the labour force.

He said that the DBJ will help to increase the number of institutions extending credit to micro and small enterprises.

JaMFA said that the increase has come at a time when the microfinance sector is focusing on their role as facilitators, and is in the middle of serious engagement with the main representatives of the MSME sector to find ways to help them grow their businesses and create jobs. JaMFA has also been staging a number of round-table meetings which focus on specific proposals to create some 1,800 long-term jobs.