JBA, JMEA form working group to address high interest rates concerns
Tuesday, September 11, 2018
KINGSTON, Jamaica — The Jamaica Bankers Association (JBA) and the Jamaica Manufacturers and Exporters Association (JMEA) have agreed to form a high-level working group to explore solutions to challenges faced by small and medium sized entities in accessing credit.
According to a release form the JBA, the decision emanated from a recent meeting where executives from both groups discussed the JMEA's concerns regarding high interest rates being offered by commercial banks.
“We had a productive meeting with the representatives of the JMEA and we have agreed to continue our discussions. While interest rates have declined significantly over the past few years and are at unprecedented low levels for some borrowers, we acknowledge that there are some segments of the economy that still have challenges securing bank financing.
“We discussed some of the challenges faced in assessing credit risk for some small and medium sized entities, and we have agreed to work together to find practical solutions to those challenges. We know that the banking sector has a critical role to play in supporting economic growth and the JBA is committed to working with all stakeholders to find ways to prudently lend to the productive sector,” said JBA.
In a release issued in August, the JMEA expressed alarm and unease at the interest-rate spread across local banks and urged the banking institutions to play their role in advancing the nation's objectives by actively reducing the mark-ups they currently employ.
An interest-rate spread refers to the difference between interest paid on deposits and the interest a financial institution charges on loans and securities.