Bank of Jamaica Developing Agent Banking System to Reach the Unbanked
Friday, October 11, 2013
In pursuit of greater financial inclusion, the banking regulator plans to allow traditional banking institutions to partner with third parties to offer banking services, as agents.
As much as a third of the Jamaican population are ’unbanked’, that is they do not use or have limited access to the formal banking system.
The banks do not generally publicise their customer base, but Scotiabank Jamaica, which is the second-largest bank, has just provided 230,000 client records to one of Jamaica’s credit bureaus, according to disclosures this week.
The agent banking system will require amendments to existing laws to accommodate the new structure, which the Bank of Jamaica (BOJ) says it is in the process of devising for promulgation within the pending omnibus banking bill, which will streamline the operations of deposit-taking institutions or DTIs.
The legal amendments, BOJ says, will allow for certain banking transactions such as cash deposits and withdrawals within certain monetary limits to be done at third-party locations, including retail outlets.
The measure will also address one of three Basel core principles with which Jamaica is currently non-compliant.