Access Financial loans back to pre-pandemic levels
Published:Friday | November 12, 2021 | 12:09 AM
L oan disbursements at microfinance company Access Financial Services Limited are back to pre-crisis levels.
The company, which gets majority of its business from micro and small business owners, transport operators and employed consumers, last year lowered loan caps and shifted disbursements to specific ‘safe’ sectors to mitigate losses from the COVID-19 pandemic.
Its loan portfolio dwindled to $3.9 billion at half-year 2020, down 13 per cent on 2019’s performance, but the comparative period for 2021 shows a resurgence to $4.38 billion as of half-year ending September, the same as in 2019. Interest income from loans was also flat at $418 million in the quarter ending September 2021, compared to the pre-pandemic outturn of $422 million, but lags over the six-month period, covering April-September, at $807 million, compared to $830 million in 2019.
A turnaround in the Jamaican economy over the past year, leading to what Access Financial described as “an improvement in the operating environment,” as well as the relaxation of measures implemented by Access at the height of the pandemic to curtail loan defaults, contributed to the restoration of business.
To maintain the momentum, Access Financial has announced plans to introduce new products for the companies in the group, which includes microlending subsidiaries DamarkMCL in Jamaica and Embassy Loans in Florida.
Additionally, Access is putting money behind technology upgrades to entice and serve more customers online and through electronic channels. More than 30 per cent of loan applications already come through the microfinancier’s website, and more customers are opting to have the loan proceeds sent directly to their bank accounts, Access Financial CEO Fredrick Williams said.
Although there was a steep decline in the company’s cash holdings, which stood at more than $680 million a year ago, mainly due to cash flows from loans, it still has nearly $400 million that it can draw on to help fund its expansion activities.
The company, which is prioritising both growth and governance as the sector in which it operates comes under central bank oversight, added four new board seats in September, with the approval of shareholders, that will allow it to increase the number of directors to 11. It followed a management restructuring at mid-year under which company founder Marcus James gave up the position of CEO to Williams and was elected as executive chairman.