MINISTER of Industry, Investment and Commerce Anthony Hylton says that his ministry is in full support of the introduction of the long-awaited Micro Credit Act.

Hylton told guests at the launch of the Jamaica Micro Financing Association’s (JaMFA) new microfinance sector magazine, microFINANCE Jamaica, at Hotel Four Seasons in Kingston on Thursday that, when enacted, the Act will provide for the licensing and regulation of privately-owned microfinancing companies or institutions (MFIs).

“The Micro Credit Act proposes that a regulator be established with the authority to issue directions or standards on transparent lending practices, credit administration and other matters relating to operational issues, and it will determine whether to accept, reject or revoke registrations,” the minister noted.

“It is also expected that the legislation will bring about a micro-lending environment that is more orderly and responsive to standards. Ultimately, this will prove beneficial to all micro enterprises,” he stated.

He said that the Government is convinced that these measures will support the development of the microfinancing sector.

Hylton was, however, unable to indicate how soon the Micro Credit Bill, which has been due since 2013, will be tabled in Parliament.

The Ministry of Finance, which is responsible for the Bill, first revealed details of the proposed legislation to regulate microfinanciers and protect their customers in November, 2013.

It was stated then that the bill would replace the Moneylending Act, under which some micro lenders gain exemptions from the Ministry of Finance allowing them to retail short-term loans or payday loans — at high rates.

JaMFA has been consistently critical of the delay in tabling the Bill in Parliament and its eventual implementation.

JaMFA’s Chairman Hurshel Cyrus has insisted that the majority of microfinancing institutions (MFIs) have already been observing best practices, but it is now left to the Government to introduced the Bill to satisfy the customers.

“In the financial space, there are a lot of good things that we practise, but it is good to have a regulatory framework where reporting is being done, to satisfy the wider society,” he has insisted.

Opposition spokesman on finance and planning, Audley Shaw, who also spoke at the function, cited the “vital role being played by the micro finance sector in the economy”.

He suggested that the sector can grow even more rapidly, if it diversifies its loan portfolio to include longer term, lower interest rate loans to individuals, and small businesses with meaningful projects that can collectively grow the economy and create jobs.

In closing, Minister Hylton said that it is expected that the legislation will bring about a microlending environment that is more orderly and responsive to standards.

“Ultimately, this will prove beneficial to all micro enterprises,” he said.

He commended JaMFA for continuing to advocate for micro financing institutions across the country.

“Indeed, it is my belief that we share the same goal of job creation, wealth creation and sustained economic growth,” Hylton concluded.

Other speakers at the function included JaMFA’s executive director, Raymond Gabbidon, and head of credit bureau CRIN NM, Terrence Cooper.