KINGSTON, Jamaica–Community and Workers of Jamaica Co-operative Credit Union here has set aside $100-million for lines of credit for micro businesses and the self-employed. But it comes with a 24% base lending rate plus a risk premium of 4%.
The Jamaica Gleaner reported that the unsecured revolving credit facility is intended for micro-entrepreneurs that do not qualify for other unsecured loans, which are typically repaid through salary deductions, according to general manager Barrington Whyte.
CWJCCU merged with the credit unions in Clarendon and Westmoreland, Jamaica, in 2011 and 2013, respectively, opening up the cooperative to a different and more rural clientele, the Jamaica Gleaner reported.
Under the new credit line Community and Workers Cooperative Credit Union said it lend up to $100,000 to individuals whose affairs “are in proper order.”
"These include taxi drivers who need to do repairs to their cars. There are a lot of those in the transport business," according to Whyte.
The Jamaica Gleaner said the new facility builds on a $10 million small farmers' revolving loan program previously offered by the Clarendon cooperative in Kellits.
The base lending rate for the new line is 24% per year, plus a risk premium of 4%. The maximum loan term is 24 months. Repayment is on a weekly basis, the Gleaner reported.
Borrowers also pay a processing fee of 2% of the loan amount plus GCT, as well as a credit check fee.
The $8-billion credit union is one of 37 in Jamaica and has 69,076 members.