The Jamaican Government is to address the problem of unbanked remittances by formalising and modernising the industry, the Jamaica 60 Diaspora conference was told on Tuesday.

“The idea is to create a market in Jamaica that would appeal to both sender and receiver to utilise the formal channels to conduct transactions, and in this regard it is essential to understand not only the current trends, barriers, sender and user habits, but also the gaps in the technological advances and innovation,” state minister for foreign affairs and foreign trade Leslie Campbell told the Jamaica Observer after his address.

“Our international partners will support the GoJ (Government of Jamaica) to modernise its remittance industry in keeping with global advances in this regard,” he said.

Campbell added that the Government’s international partners will assist with providing key data on the current legislative, regulatory, policy and institutional framework governing remittances, with recommendations on how to transform and modernise them in accordance with global advances and best practices, in order to ensure the sustainability of future flows.

Remittance agencies are regulated by the central bank which, in its 2021 annual report, noted that amendments to legislation governing its mandate were updated and enhanced to explicitly include its supervisory powers to implement a licensing regime for money service businesses (remittance services and cambios), and to subject operators to its ‘fit and proper’ criteria as a condition for licence issuance and renewal.

The Bank of Jamaica said the changes were “a necessary measure to strengthen Jamaica’s anti-money laundering/combating terrorism financing framework, and place the country in an improved position at the next round of CFATF (Caribbean Financial Action Task Force) mutual evaluations”.

The central bank pointed out that last year it continued to pursue its strategic objective of developing a risk-based assessment tool for supervision of money service businesses, to include the identification of a framework for risk-based supervision of remittance companies. It noted that the risk-based assessment for supervision of remittance companies will be informed by thematic studies that were being finalised, at the time of reporting.

At the same time, the bank reported that remittance inflows remained buoyant in 2021, despite the impact of the novel coronavirus pandemic, with a year-on-year increase of approximately 22.5 per cent in remittance inflows, relative to 2020.

The United States, United Kingdom, Canada, and the Cayman Islands remained the main source countries for remittances at 70.2 per cent, 10.9 per cent, 10.4 per cent and 5.2 per cent, respectively.

One hundred and fourteen new remittance licences were issued, totalling 782 at the end of 2021, compared to 699 at the end of 2020. At the same time, 31 operators voluntarily surrendered their licences, and while remittance operations started at 35 new locations or service points, 69 locations were closed — 44 because their licences suspended, while 25 voluntarily surrendered their licences. As a result of those activities in the industry, there were 463 locations in operation at the end of 2021, relative to 497 at the end of 2020.

In his address on Tuesday, Campbell stressed that the Jamaica 60 Diaspora Conference is intended to give added impetus to the process of strengthening, expanding and sustaining diaspora engagement.

“The added focus on digital transformation is of particular significance and will capitalise on the cultural affinity of the diaspora to Jamaica and the engagement opportunities offered by new and emerging technologies,” he stated.

He said the intent is to develop key elements of an implementation roadmap, which will serve to re-energise and motivate members of the diaspora to be active and collaborative partners in areas of mutual interest in the post-COVID-19 era.

This is the ninth staging of the conference, which is hosted by the Ministry of Foreign Affairs and its local and international partners as a key component of the Government’s formal engagement with the Jamaican Diaspora.