Outgoing president of the Jamaica Micro Financing Association (JaMFA), Hurshell Cyrus, has credited Minister of Finance and Public Service Audley Shaw with the success of the microfinance sector in Jamaica.

Speaking at JaMFA’s fifth biannual microfinance sector leadership forum last Tuesday at Hotel Four Seasons, in New Kingston, Cyrus said that Shaw’s input into the development of the sector had enabled it to grow from a $3-billion per year industry, to a $20-billion a year sector.

Cyrus said that Shaw was very accommodating and was personally responsible in his first term as finance minister for two government actions which were largely responsible for the rapid growth of the industry.

“When we were getting some amount of resistance from the ministry, despite completing applications and meeting the requirements, Mr Shaw was very accommodating and really looked into the future and said that if it is necessary to make their contracts legal to lend above the prescribed rate in the Money Lending Act, why are we not granting the exemptions?

“He insisted that they open a window to allow the microcredit institutions to be exempted from the Money Lending Act,” Cyrus explained.

He said that this allowed the lending firms to offer loans which were important to small and micro businesses, which could not afford to access the regular banking system for funding.

“That paved the way for us to achieve what we have now. I am sure that maybe over 20 entities have now got exemptions under the Money Lending Act to allow them to fund these businesses,” Cyrus said.

He said that second initiative was when the microfinance sector was being called upon to offer more assistance to businesses, but were unable to encourage public servants to access their loans because the payments would not be refunded through salary deductions, Shaw again came to the sector’s aid.

“We came to a crossroads again to get the deductions from the government employees’ salaries. We were shut out of that and we made a case that, in order for us to lend to the micro-businesses, which are high-risk, we have to honour our portfolio.

“We were prepared to adhere to certain practices and we had a very long list, including bringing the rates down. We said to the government that we needed to balance our portfolio with some personal loans, where we could reasonably be assured that we are going to be repaid. He started the process and that has led to a number of microfinance companies being approved for deductions from the salaries of government employees,” Cyrus said.

“Listen to me, that has made a difference to the sector. That has moved the sector from one that was maybe doing $3-6 billion per annum to $20 billion per annum in disbursements.

“So when I say Mr Shaw is a friend of the sector…this man has singlehandedly played his role in the creation of what we have today,” he said.

Cyrus, who heads WorldNet Investments, is giving up the chairmanship of JaMFA, to make way for vice-chairman Sandra McDonald Spence, of McKayla Financial Services Limited, to assume the position.