THE Jamaica Micro Finance Association (JaMFA) and the JN Life Insurance Company (JN Life) signed a Memorandum of Understanding (MOU) on Thursday, which makes JN Life the sole providers of “creditor life insurance” for the clients of members of association.
In return, JN Life has committed to supporting initiatives that JaMFA plans to undertake as part of the activities aimed at the development, growth and prosperity of the microfinance sector.
The signing took place in the boardroom at the Jamaica National Building Society (JNBS), 2-4 Constant Spring Road, Half-Way-Tree, St Andrew.
Under the terms of the MOU, JN Life and JaMFA will collaborate to provide support for the micro, small and medium size business enterprises, to stimulate growth in the Jamaican economy.
JaMFA will also promote JN Life as one of its developmental partners, as well as require members to enter into full-service contracts with the life insurance company in order to benefit from their Single Premium Creditor Life Insurance product.
Commenting on the signing, Oliver Tomlinson, General Manager at JN Life, said the MOU was part of his company’s thrust to assist the MSME sector.
“In every country small businesses make up the bulk of companies that provide employment. They are also the main drivers of economies around the world. Hence, our collaboration with JaMFA is one which will allow us to provide life insurance to many MSMEs, and users of the Single Premium Creditor Life Insurance product specifically designed for MSMEs,” he said.
Tomlinson maintained that the MSME sector is underserved, and that this is an opportunity to provide them with a service that is essential to their survival.
“On that basis, the Single Premium Creditor Life can repay the client’s debt directly to a lending institution in the event of death or permanent disability. This product will ease the burden on both the client and the lending institution with the signing of the MOU,” he stated.
“We want MSMEs to develop and contribute to growing the economy; and, with insurance coverage we hope many persons will be encouraged to seek funding for their operations, so that their families will not be left with that debt burden,” he said.
The agreement also allows JN Life to sponsor JaMFA initiatives, and promote the organisation as a developmental partner for the growth and development of the MSME Sector.
Raymond Gabbidon, Executive Director of JaMFA, said the MOU between JN Life and JaMFA is in keeping with worldwide trends, with more micro financiers seeking to provide insurance coverage for their clients.
“Insurance coverage for MSME clients is in keeping with international trends towards client protection…This MOU is a tangible example of a practical approach to the whole issue of client protection,” he said.
He also stated that it is another example of JaMFA taking the lead on issues pertinent to the survival, growth and development of the sector, as against the lip service which is fashionable today.
“This MOU is just one of several initiatives undertaken by JaMFA since late 2010. It augurs well for us as an association, because we are helping our members to better serve and empower their clients,” Gabbidon said.
Earl Jarrett, General Manager of Jamaica National Building Society, commended both JN Life Insurance Company and JaMFA for their efforts in seeking to extend practical help to the MSME sector.
He commended the move, and promised that the JN group would continue to seek viable partnerships in the development and growth of local MSMEs.