A private equity fund anchored by VM Investments Limited and the Development Bank of Jamaica has taken a stake in microlender Wilco Finance Limited.
Wilco CEO Nikisha Walters says JASMEF or the Jamaica Actus Small and Medium Enterprise Fund is now a “significant minority partner” but otherwise declined to comment on the specifics of the stake sold and the size of the transaction.
The Wilco deal is JASMEF’s first investment.
The nascent private equity fund, which was created to invest in Caribbean SMEs, is seeded US$10 million by VMIL and US$5 million by the development bank on behalf of the Jamaican government. The fund, which is operated by VMIL Actus Caribbean PE Limited, also got support from the World Bank under its A2F or Access to Finance Project.
Wilco was incorporated in 2009 and began operations in 2010. Walters became the CEO in December 2020. The company provides credit solutions to employed persons through salary deduction and business loans for micro, small and medium-sized companies, lending on the reducing balance.
Wilco’s loan portfolio was valued at “approximately $260 million” while its total assets were estimated just under $300 million as at the same period, Walters told the Financial Gleaner.
Over the years, its services have been driven by technology and that will continue, she said.
The company says its application for a microcredit licence was submitted in June 2022 but it’s still awaiting approval from the central bank.
However: “The company has been approved to continue its business operations by the Bank of Jamaica” pending finalisation of the licence, she added.
Walters declined to discuss her new growth targets.
The BOJ, which was recently made regulator of the microcredit sector, said in its latest update that so far it has approved licences for 27 firms of 143 applications.
Altogether, the number of applicants reflect an aggregated loan balance of $45.8 billion.
The central bank has also provided 82 regulatory forbearance letters, which allow operators who applied before the end of the transition period, that is before July 30, 2022, to continue operating until a decision is made to grant or deny a licence. Sixty-two of the temporary permits remain in force.