NCB Financial Group Limited’s (NCBFG) Jamaican subsidiaries are planning to expand the reach and depth of the payment services division to new and existing customers in 2023.

NCBFG’s banking subsidiary has been diversifying the range of options offered to both retail and merchant customers in recent years. As part of its plan to further bridge itself into the digital payments space, National Commercial Bank Jamaica Limited (NCBJ) plans to launch NCB Pay by the end of the second quarter, which will work similarly to Apple Pay and Samsung Pay.

“We recently completed the staff pilot for NCB Pay, which is our new card app which enables customers to digitally add their Visa and Mastercard into the app and conduct contactless transactions at point-of-sale (POS) machines both locally and internationally using only their mobile phone. We believe the future for NCB payments innovation continues to be bright and we will continue to deliver on our commitments to enhance the payments experience of our customers,” said NCBJ Vice-President of Payments and Digital Channels Danielle Cameron-Duncan at the NCBFG annual general meeting last Friday.

Cameron-Duncan added that the roll-out of the new Verifone VX series has gone well so far with positive feedback. With almost 2,000 POS terminals deployed islandwide, NCBJ now accepts the widest range of payment processors, including American Express, under the global network services model. NCBJ has an estimated 70 per cent market share of the 48,325 POS terminals issued in Jamaica.

It was also revealed that work is ongoing to allow peer-to-peer (P2P) transfers via NCBJ’s card rails to allow 24/7 transfers with anyone that has a Visa or Mastercard branded card. There were 117.56 million electronic transactions conducted between January to October 2022 valued at $3.02 trillion, according to Bank of Jamaica (BOJ) data.

NCBFG’s payment services segment recorded an increase of 24 per cent to $7.13 billion in the first quarter (October to December), which was supported by the increase in cross-border transactions, e-commerce transaction volumes, and the recovery in travel and entertainment and local corporate retail and government sectors. However, the segment saw its operating profit cut in half from $487.72 million to $241.88 million.

NCBFG Chief Financial Officer Dennis Cohen explained in his first-quarter remarks, “While there has been growth in revenue for this segment, there have been higher operating costs related primarily to our investments in the digital wallet Lynk. Without Lynk, the impacts of the payment services results would have been up 25 per cent over the prior year.”

Lynk is the mobile application run by NCBFG subsidiary TFOB (2021) Limited led by Chief Executive Officer Vernon James. TFOB received seeding of $2.05 billion in 2021 from NCBFG in the form of equity capital and got an additional capital injection of $18.97 million in 2022. It was able to have more than 170,000 unique users and had 4,700 merchants in its first year of operation. In December, it became the eighth primary agent for remittance services by the BOJ with MoneyGram as its first remittance partner.

When asked about the addition of new remittance partners, James said, “In terms of providers for other remittance services, we are in discussions with two more. We do anticipate that we will have others certainly on board offering the service before the end of the financial year [September 30].”

The Lynk CEO added that Lynk Lite was launched recently to make onboarding easier for new users, with the remittance platform set to be launched along the same timeline as NCB Pay. He said that the remittance product and feature has been quite extensive, following the recent LynkBiz platform launch for businesses.

Remittance inflows for the first 11 months of 2022 was down by two per cent to US$3.11 billion, which was just below the 2021 record of US$3.50 billion. There were 510 active locations across the island with 785 licences issued up to June 2022. The United States of America continues to account for 70.2 per cent of total remittance flows for Jamaica.

Lynk was the first mobile wallet to accept the BOJ’s central bank digital currency dubbed JAM-DEX. JN Bank is set to launch JN Pay come next month as it became the second approved institution to offer the digital currency. Other commercial banks have indicated that they’re actively exploring the development of a digital wallet to accept JAM-DEX.

“As it relates to the continued investments in TFOB and Lynk, we’re a software company. As we build features, we have to invest in technology and invest in the software development. We also have to invest in the marketing of the new features because Lynk is an app of continuous engagement. Also, when you look at Lynk, we are continuously improving. So, even what we’ve built before, we continuously reiterate it,” James closed.