ADVERTORIAL | Banking across Jamaica’s digital divide

Continued complaints about the level of bank charges in Jamaica, highlight a key aspect of the country’s digital divide, with some accessing financial services at low or no cost, while others find themselves spending substantially more time and money to achieve similar results, says Ricardo Dystant, chief of channels at JN Bank.

Mr Dystant said that competitive pressures are driving banks, just as other businesses, to offer more of their services online, to effectively reach the new clients, who provide their main growth opportunities. The challenge companies face is that they must also ensure that they maintain high standards in their analogue systems, to satisfy the existing customer base.

“Many Jamaicans want to walk into a bank and give their money to ‘Terry-Ann,’ their favourite teller, so that if any issues develop, they know who to go to,” the head of the bank’s distribution network stated. “However, younger Jamaicans don’t want to go into banking halls at all. They are comfortable banking ‘online’ through their smartphone.”

Banks are, therefore, being forced by competitive pressures, to restructure their methods of serving their customers; and this benefits the younger, more technologically savvy customers, Mr Dystant explained.

Using International Monetary Fund (IMF) data, TheGlobalEconomy.com website, showed that the number of bank branches in Jamaica fell from 6.96 branches per 100,000 persons in 2004, to 5.06 branches in 2014.

“Despite having a reduced number of branches, banks are doing much more business than before, as they become better places to conduct more high-value transactions,” he said. “The majority of basic cash transactions have been digitised where possible, or offloaded to specialised money payment services and automated teller machines.”

The number of automated teller machines (ATM) in Jamaica nearly doubled from 17.6 per 100,000 adults in 2004, to 33.8 per 100,000 adults in 2018, growing at an average annual rate of 4.83 percent, according to financial services specialists, Knoema Corporation in the United States of America.

Nicholas Lawrence, Software Development Lead at MC Systems Limited, explained that: “The use of smarter ATMs is just one aspect of the transformation in banking. MC Systems has been assisting companies in adopting systems, such as debit and credit card payments, using a smartphone or tablet, which are more secure and convenient while also saving money for the companies which deploy them.”

“The challenge organisations face, and the opportunity they have, is that it costs more to carry out a transaction using cash, rather than doing it digitally. That is why customers paying with cash may increasingly find themselves at a disadvantage,” he reflected.

“To function most effectively in the past, customers developed a personal relationship with their bank tellers and branch manager,” Mr Lawrence observed. “Those contact points remain important now, but increasingly, institutional growth is being driven by the enhanced data collection and analysis processes banks are adopting.”

“It is those customers who allow the institutions to get adequate data about their financial affairs, who will be best served by the new financial service platforms, which drive their digital wallets and mobile banking needs,” he added, noting that. “Cash bound customers are not the focal point in this brave new world.”

A survey of Caribbean Broadband and Information and Communications Technology Indicators, conducted by Professor Hopeton Dunn of The University of the West Indies in 2019, showed that there was wide access to the internet, with 38 percent of respondents using the internet, at least once per day; while 85 percent did so, within the last three months of the survey.

The survey, which looked at the use of computers, internet and mobile phones, found that the majority of persons who use the computer or internet, ranged in age between 15 and 34.

Mr Lawrence declared that: “We have a new dividing line emerging in

our country, between those who have been empowered by these new

financial technologies, and those who have not. There are many older

Jamaicans who comfortably function with the new systems, but the

most important factor, determining which side of this digital divide you

are located, is age. Perhaps this is because younger Jamaicans grew up with the technologies around them.”

Latoya Nesbitt, acting principal, Allman Town Primary School, explained that, “children emerging from our school system now are ready and willing to use the technology which is available to them. It is not actually a part of the curriculum of Allman Town Primary; however the students generally get opportunities from initiatives carried out through the schools; at classes in community centres; as well as gaining access through internet cafes.”

Private sector organisations support some training facilities and another major driver for the youth oriented programmes, is the Universal Service Fund, which is also facilitating greater internet access by providing free secured Wi-Fi hotspots in popular public locations.

“With access to free internet service, and given their natural curiosity, the young are embracing the new technology,” Ms Nesbitt said. “My experience is that many older Jamaicans don’t have the time or the interest to learn.”

Mr Lawrence added, “given the new world of financial opportunities that digital technologies open up to consumers, there is a tremendous incentive for those being left behind, to make an increased effort to adapt using online resources at their disposal. All it takes is a little patience.”

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