One million Jamaicans who save and borrow through credit unions woke up to an unwelcome surprise: the Bank of Jamaica (BOJ) has yanked a clause that would have allowed the sector to bypass commercial banks and settle transactions in central-bank money.
The deleted measure—known as the Specially Authorised Credit Union (SACU) provision—was tucked into draft regulations that are inching toward Parliament. SACU would have turned the Jamaica Co-operative Credit Union League (JCCUL) into a “credit union for credit unions,” giving its 23 affiliates the same back-office privileges commercial banks enjoy: real-time gross settlement, cheque clearing and foreign-currency deposits.
Why it matters
Without SACU, every dollar that moves between credit unions must still detour through a competing bank—adding fees, delays and, critics argue, an unnecessary commercial choke-point. JCCUL chief executive Robin Levy says the about-face is baffling.
“We already lend to and accept deposits from our member credit unions,” Levy told reporters. “Direct access to the BOJ’s settlement rails is the logical next step. Building societies have it, banks have it—why not us?”
Analysts note the timing is awkward. Jamaica’s credit-union footprint—$190 billion in assets and roughly 13 per cent of the retail-financial market—may be modest, but the membership base dwarfs any single commercial bank. Blocking direct settlement, Levy warned, effectively hands that captive flow of funds back to the banks.
A sector on alert
JCCUL President Andrea Messam labelled the deletion “a non-starter” and signalled full-scale mobilization. Position papers are already circulating across branches, and credit-union managers have been asked to brief their boards and members on what is now at stake.
Sean Martin, who represents the Essential & Emergency Services Credit Union, was blunt: “Every transaction we route through a bank fattens their bottom line and trims ours. Our mandate is service, not profit.”
Trelawny Co-operative’s general manager, Robert Tubble, went further, hinting at street-level activism. “Our one-million membership equals one-third of Jamaica’s population. If persuasion is required, we’ll provide it,” he said to applause at a recent league meeting.
Global precedent, local roadblock
Across North America and Europe, “central” credit unions act as settlement hubs—an arrangement academics have long credited with keeping fees low and competition high. JCCUL argues Jamaica can replicate that blueprint with minimal risk; after all, the BOJ would still supervise the league under the same prudential rules that govern banks.
The central bank isn’t commenting beyond a terse note saying the regulatory framework “remains under review.” Insiders, however, whisper that policymakers are unconvinced a SACU won’t morph into a full-service bank by stealth.
Two plans, one objective
Publicly, JCCUL insists SACU is the ideal fix and says it will lobby Finance Ministry officials to restore the clause. Privately, the league is drafting a fallback: apply for a full banking licence. That nuclear option, insiders say, would take longer and come with heavier compliance costs, but it would eliminate any dependence on commercial rivals.
Levy used a fast-food analogy to make the case: “Forcing us to clear transactions through a bank is like telling Popeyes it can only sell chicken inside a KFC outlet. Absurd.”
What’s next?
- Lobbying blitz League directors will meet lawmakers over the next fortnight to argue SACU’s merits.
- Member outreach Branches have been instructed to run information drives so customers understand why their fees could rise if the status quo persists.
- Regulatory chess If the BOJ holds its line, expect JCCUL to test the waters for a banking charter—turning yesterday’s co-op into tomorrow’s competitor.
For now, Jamaica’s credit unions remain in wait-and-see mode—still cooperative by nature, but ready to flex collective muscle if central-bank policy blocks their path to full financial independence.
