Senior Reporter
andrea.perez-sobers@guardian.co.tt
Understanding the impediments and issues surrounding the low financial inclusion in Jamaica and, by extension, the Caribbean is important to move the industry forward.
It is also important for insurance products to be user-friendly to all.
That’s according to Dr Dana Morris Dixon, Minister without Portfolio in the Office of the Prime Minister with oversight for Skills and Digital Transformation, who was speaking at a webinar, held yesterday in Jamaica which was hosted by Phoenix International, a division of MC Systems Ltd, Microsoft and TD Synnex.
During her address, Dixon said the use of electronic transactions in Jamaica is significantly lower than other countries and, therefore, there is a heavy reliance on cash.
She noted that a study done by the Bank of Jamaica, which was released in January 2024, pointed out that the households lack suitable and accessible savings, affordable insurance, retirement products and struggle to be financially resilient.
“That is something we have seen. Only 30 per cent of Jamaicans, for example, save through a regulated financial institution, which is an issue. The study also showed that many businesses have no access to formal credit and that is a key area of financial inclusion, where our small businesses, especially, do not have access to capital, which will stymie the growth of the business,” the minister explained.
Another aspect she highlighted was that in the credit and insurance sectors, there were too many individuals who did not have adequate coverage.
Dixon explained that insurance is a means to enable people to preserve their wealth and when a large segment of the population does not have access to insurance products, that can be a financial challenge.
“You hear older people or even younger people say insurance costs are too high. ‘I cannot insure my house, I would just self-insure,’ which is a problem. When a natural disaster comes, and we are now in this era of climate change, the risk around disasters is increasing and what this means is that insurance products are more important. So, when we do not have people accessing the products it can have a debilitating effect on their ability to weather any kind of storm,” Dixon detailed.
The minister stressed that it is important for financial institutions to build digital platforms that are very user-friendly as this would encourage more users, instead of deterring them.
“This is what I always say to the government entities, it is nice to put new services online, but if you don’t re-engineer the process to make it easier for people, then we would have lost, and this is what I also say to the financial sector. In using technology, it needs to be much more useful to people,” the minister mentioned.
Also speaking during the webinar was Gillian Jackson, senior manager, data analytics, of the Jamaica National Group, who said that artificial intelligence, is very helpful to financial institutions as this can streamline data and loan turnaround time is much faster.