KINGSTON, Jamaica — A deepening divide has emerged between Jamaica’s small business community and the country’s commercial banks, as calls for lower lending rates following the Bank of Jamaica’s (BOJ) policy shifts go unanswered. The Small Business Association of Jamaica (SBAJ) has raised concerns that this disconnect threatens the very survival of thousands of small enterprises.
While the BOJ announced its fourth interest rate cut of the year—bringing the policy rate to 6 percent, effective December 23, 2024—commercial banks have been slow to reflect this reduction in their lending rates. These cuts are part of a broader effort by the central bank to spur economic recovery, but their benefits appear to be trapped within financial institutions, leaving borrowers with little relief.
For small business owners, the lack of response from banks is not just an economic challenge but a breaking point. “We’ve been navigating tight margins for years, but this is different,” said Garnett Reid, SBAJ president. “The BOJ is lowering barriers to growth, and the banks are building walls in their place.”
Business owners report borrowing costs for loans remaining at rates as high as 18 percent, even as the BOJ pushes for more affordable financing. This disparity, the SBAJ argues, undermines Jamaica’s monetary policy and hinders small enterprises, the backbone of the nation’s economy, from achieving their full potential.
The SBAJ is urging swift government action to hold financial institutions accountable. The group has also criticized what it calls “deafening silence” from the Bank Association of Jamaica (BAJ), accusing the organization of ignoring the urgency of the situation.
“This isn’t just a financial issue—it’s a systemic failure,” added former SBAJ president Michael Lecky. “When banks profit at the expense of small businesses, they weaken the economic fabric of our country. It’s not sustainable.”
The SBAJ is advocating for a more transparent relationship between banks, policymakers, and the business community, warning that if this impasse continues, it will have long-term repercussions for the country’s economic resilience.
Meanwhile, small business owners across the island face mounting frustration, wondering when—if ever—the relief promised by the BOJ’s policies will trickle down to their balance sheets.
