Participants in the first conference of small and medium-sized enterprises in Yemen Called to create a public financial institution help banks and microfinance institutions to grant loans to the sectors of small and medium-sized enterprises guarantees easy, accessible and simple interest rate.

The conference was held the first Yemeni small and medium-sized enterprises in the 26-27 / May in Sana'a organized by the Yemeni Association for Business Development and in cooperation with the Ministry of Trade and Industry.

Said Dr. Abdullah Al-Mikhlafi, Undersecretary of the Ministry of Finance and professor of banking at the University of Taiz, in an interview with balcony "will not list for economic development only if there is interest in SMEs via its support in the planning stage and provide technical support her and to expand and facilitate the process of funding them."

He admitted Al-Mikhlafi not sharing the government enough to support small and medium enterprises, calling for the establishment of a governmental body working to secure the necessary funding for these projects and allocate part of the capital of commercial banks and Islamic countries, between 10 and 15 per cent, to finance small and medium enterprises.

The participants recommended that the central bank required a certain percentage of the loan portfolio mandatory in Islamic and conventional banks in Yemen of not less than 15 per cent went to the small and medium-sized enterprises.

As well as to avoid activating the insurance for bankruptcy protection and activating the role of compulsory insurance affordable for entrepreneurs, as well as enable, support and encourage women in the implementation of small and medium-sized enterprises and to provide financial and technical support to them.

He said Munawar Essanoui, Executive Director in Yemen Society for Business Development, for the balcony "The small projects are of great importance in the economies of developing countries and account for about 90 per cent of the total national income because it is fast in generating jobs at a high rate as it provides job opportunities free to a large number of members of the community . "

"If we want to promote sector small and medium enterprises we establish a joint body including private and government sectors concerned with SMEs and working to develop this sector from three directions: the first regards the legislative structure provided that they are accessible and supportive of the sector, and the second for funding and soft loans, and the third terms of providing opportunities for training and advisory services, feasibility studies and technical support. "

'Column the economy'
In turn, he said certified Abdo Srora, the director of human resources at the Small Industries Development Fund, said that small and medium-sized enterprises are the "pillar of the economy" in Yemen and developing countries in general.

He continued, saying, "If the government wants to achieve sustainable development and the recovery of real economic interest in this sector in kind and financially and in terms of infrastructure."

And the constraints faced by small enterprises, summed up by failing to provide legal protection, as well as funding for banks to production processes only instead of starting from scratch funding.

And the Central Bank's role in supporting small and medium enterprises, explained Balkis Ahmad, Director of the Department of Islamic banks and specialized in the Central Bank, saying he was "focused on control over the institutions and banks lending small and medium enterprises in addition to passing legislation encouraging the work of the private banking microfinance."

She stated that the law gave incentives for the establishment of microfinance banks, including reducing the required capital to 600 million riyals (2.8 million U.S. dollars), compared to six billion riyals ($ 27.9 million) to other banks, and shorten the establishment procedures to enable the granting of a license in a period of two months from the date of submission demand. KD Suite

Ahmed added that making the central bank rate-setting open to microfinance banks, unlike other banks.

Her "The microfinance banks made good strides in the provision of services to beneficiaries," and this is what encouraged other institutions to provide microfinance services and small as she put it.

She explained, "We now have new applications to provide these services from one of the exchange companies and offshore bank, as there is a proposal under consideration to integrate some financial institutions and converted to a smaller bank financing." Forex Indicator Predictor
Learn More about Microfinance in Yemen

Microfinance in Yemen - Afrah Ahmed (23 years) Her small project in the Yemeni capital Sanaa, which is accustomed to micro-loans; and is now poised to request her third loan, but when asked whether she previous loans have helped to improve her life, came a lukewarm response.
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IM John Chow

The Private Investment Corporation "OPEC" U.S. government institution specialized in finance and development and "ABRAJ Capital" Agreement commitment to invest $150 million in a fund to support small and medium enterprises in the Middle East and North Africa "MENA".

Small Business Loans

The fund, which invests dubbed "Entrepreneurship Fund to finance institutions" in the small and medium-sized enterprises and administered by Aureus Capital, a subsidiary of Towers Fund represents of its $ 400 million capital funding source for small and medium-sized projects with countries in the region.

The agreement was signed by John Morton representing OPEC Foundation and Mustafa Abdel-Wadood, CEO of "ABRAJ Capital".


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After that we have identified the concept of Small Business , in this article we will talk about How To Start A Small Business From Home?

Require the start of the first steps of any project of the house determine the objectives of the project and how much money, effort and time required to launch the project and ensure its success and continuity. This means that he must have a clear vision for the form of the proposed project when you start the actual production operations and what are exactly the elements or factors to be available for the launch of the project. When agreement on the implementation of any project must be verified that this project, which will be of the house will be able to achieve the overall objectives of the port and the idea or other words project contributes to the self-realization. To achieve this, the destination must be a research and marketing studies to determine the amount of capital and expertise required to provide the product or service that the project and identify potential primary productivity of the project with a study of the possibility of increasing production capacity in the future on the basis of the needs of the target market which will require the identification and study of the nature of that market.

How To Start A Small Business From Home

Once the initial estimates of the financial and technical requirements necessary for the implementation of the project will become clearer and more easy to the economic feasibility of the proposed project. There is no doubt that the commitment of those steps would avoid falling into the errors initially passed by the owners of some of the projects where many of them spent time and money in the projects did not generate the revenue that was the target of many considerations such as lack of appropriate idea of ​​the project to the needs of the market. It is believed some of the small business owners that the project's success means the ability to create a product or service in a sophisticated but the real success of the project is of course the ability to market the product and gain a good share of the target market. Must start before the actual steps of the production process put samples of the product of the initial target consumer and identification directly on the views of the consumer in that commodity in terms of quality and price level, and any proposals for amendments can be made to the product. Is also needed to identify the products are identical or similar in the market to determine the competitive advantages that can be enjoyed by item produced during the project home, whether that feature is represented by the lowest price or the ability to provide additional service with the item at hand, such as delivery to the client directly.

Through the identification of similar products on the market, which usually will be the competition will enable the development of a realistic perception of the actual needs of the market as it would be easy to determine which additions can be made to the product that will be presented through the project home to win new segments of consumers. There is no doubt that once identified the actual needs of the market it will be possible to take the right decision on choosing the right product is able to access the target market and ensure the continuity of the project.

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There is no definition inclusive of the small Business and varied scientific outlook and the process are in, because the small term project "Small Business" carries its aspects among many questions, including:

Type of small-scale project
Minimum and maximum employment by
Minimum and maximum investment
Distribution of project products
Relationship with the small export
The small capacity of the project
Quality products, small-scale project
Form of management and administration in these projects
Level of technology used in small-scale project
The form of small-scale project in terms of legal
Realistic picture of the project (factory house and workshop)

The Concept of Small Business

All of these criteria from our point of view contribute to defining the concept of small projects, and we can say that the concept of small-scale project is a project that does not depend on technology-intensive in general, Small business is the foundation in carrying out the number of labor no more than five members of the maximum capital of ten thousand to fifteen thousand pounds, there is no separation between ownership and management (owner of the project is run by) is characterized by simplicity and local products designed to cover up the local environment needs export a later step.

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Objective of the small Business:

Range goals of small projects, including:

What is aimed at profitability
What is intended to provide employment opportunities
What is aimed at achieving social returns
What is aimed at raising the level of service
These goals may be combined together. It is scientifically is often small-scale project the primary objective of profitability and in the fastest time due to the small and limited capital investment.

Capital of small-scale project:

The small Business recoil is a young man starts its first steps in life. And thus limited its investments and the capital in fixed assets is low (land buildings equipment). In fact, small-scale project that seeks to recover the money in as little time as possible.

Level of technology and machinery:

Given the weakness of the financial capacity of small enterprise owner is often the technological level is a relatively advanced user; also characterized by limited tools and machines used, and often manual and highly dependent on the skill of the workers. Because of small and micro basis in Handcrafts, and thus no essential role for technology-based tools and machines.

Number of employees in small-scale project:

As we advance the concept of the project small and micro. The most important characteristics of small businesses lack the number of employees. There is no specific measure is reliable in this area due to the difference from one country to another in Japan, for example: The project is small if the number of its employees less than 50 people. And from 50 to 99 is considered a legitimate medium and more is one of the large-scale projects and in the United States when the number of employees working less than 25 it is considered a small project.

Some expert see that your craft project is a small business if it is less than ten individuals. When you see in the others, in its definition of the project as a  small Business , which employs less than 50 people, and so there is no clear measure of a specific number of employees in the small Business .

Possibilities for a small Business :

These possibilities include:

Production capacity
Energy storage
The volume of purchases
Services provided to workers
Management experience in marketing
Planning and Information Systems
Financial decisions

This is the limited possibilities in the small-scale project, and stick to personal characteristics of the owner and the extent of scientific expertise and rehabilitation.

The degree of proliferation:

Produces small-scale project is limited and is often the consumers of this production in the framework and limits of the project area, this means that the degree of proliferation of the project small Business is very limited.

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Held the second training program for the development of the microfinance sector in Bahrain with the participation of delegations from Chambers of Commerce, Gulf, Arab and Islamic World, and the participation of a number of agencies responsible for funding the smaller of the Islamic countries

The statement quoted the Chairman of the Chamber Essam Fakhro said, that the program of microfinance is the best option for the diversification of financing options to micro, especially in light of the difficulty in obtaining funding for the owners of these institutions, which would lead to other difficulties in the administrative and technical view of the adoption these institutions on the capabilities and expertise of their owners at work in the main, and the use of equipment less sophisticated and advanced than those used in institutions with large financial means in order to save money and minimize the cost.

For its part, expressed the Secretary-General to coordinate Chamber of Islamic Trade and Industry expressed the hope that the returns Forum the positive results of the microfinance sector and those who support it, she said during a speech at the opening ceremony that the issue of funding in general is one of the main obstacles that hinder economic growth and the financing of projects small with respect in particular, pointing out that the Islamic Chamber of Commerce and Industry in Pakistan is keen interest in the development and the development of the commercial sector is important, through its cooperation with its partners to organize several workshops and asked for training programs specialized in microfinance and the belief in the roles discharging performed by MFIs, pointing out that the issue of funding in general is one of the main obstacles that hinder economic growth and the financing of small projects.

Also showed that there are currently more than 67 million people all over the world want access to microfinance for their projects, and said that he is expected to grow this number steadily in the near future, which calls for developing a joint plan to support the owners of these institutions and protect them from exploitation which may be subjected by the banks in return for financial loans or through the conditions imposed on the beneficiaries.

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Insurance in Morocco

Known to the insurance in Morocco prosperous economically significant because of the development of services and multiple types such as insurance on health, and accident insurance, housing and other types of insurance, which provide protection cover works to transform the impact of different types of risks that may be exposure to professional institutions ready and able to withstand the effects of such risks, and these institutions are called insurance companies.

For the insurance accident insurance companies bear the losses of accidents to persons insured beneficiaries of insurance services on the physical and material damage resulting from the occurrence of sudden accident as it contracted with the company.

As the insured person to pay the annual premium to the insurance company that if an event has an accident car is compensated within a certain time frame, within the limits of the conditions of the contract between the parties which features an irresistible, could reach tens of thousands, knowing that the annuity referred to not recovered in the absence of any incident.

In addition, the annuity contract may be increased by greater than a male and therefore the terms of the subsidy is better than its predecessor.

It should be noted that the intense competition between insurance companies depends on the policy of awareness and communication strategy and marketing has made the sector known as kinetic markedly, empowers citizens the opportunity to choose presentations suitable for them to insure their cars and themselves from the incidents of physical, physical, and their health and their lives to other types of insurance compact in the market Moroccan insurance.

It should be noted that insurance companies have contributed their part in raising the level of the sector in Morocco and made citizens aware of and care about the insurance, whether on accident or on life, and other offers available in the insurance in Morocco market.

On the other hand the microinsurance in Morocco is witnessing a remarkable development, which is aimed at reaching the poor in Microfinance sector, who they can not access the services of insurance companies in Morocco.
http://themicrofinance.blogspot.com

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Family Bank Bahrain

Family Bank in Bahrain was accepted as a new member of Sanabel Microfinance, a regional network based on the membership of MFIs in the Arab countries. Where members of Sanabel serve more than 80% of microfinance clients activists (more than 750,000 smaller entrepreneur in the Arab world).

Sanabel Microfinance Network is access to the largest possible number of microentrepreneurs in the Arab countries by strengthening the capacity of MFIs through capacity building services such as training, translation and publication of sources and literature on microfinance and to encourage and facilitate the exchange and communication between workers in the microfinance industry through the conference annual Sanabel website and newsletter of their own, in addition to the Arab Grid for microfinance based in Arab Republic of Egypt-based and are Sanabel first network of its kind and the only one designed to serve microfinance institutions in the Arab world as a non-profit network includes ears 87 members of the 13 Arab countries are mainly Egypt, Iraq, Jordan, Lebanon, Mauritania, Morocco, Palestine, Saudi Arabia, Sudan, Syria, Tunisia and Yemen.

The Family Bank in Bahrain was established initiative of the partnership of the Ministry of Human rights and social development with a number of partners from the private sector has received the Bank's license in October 2009 as the first Islamic bank specialized in microfinance, in partnership between: the Ministry of Human Rights and Social Development , the charity's property, the Bank of Bahrain and Kuwait, Ithmaar Bank and Ahli United Bank, Kuwait Finance House, and according to the framework of cooperation with Grameen Foundation Trust.

Arab Gulf Programme for the support of the United Nations Development "AGFUND" began the executive steps to establish a sixth microfinance bank in the system "AGFUND" to combat poverty called Bank of the Poor in Sudan like Grameen bank in bangladesh by the microfinance guru Muhammad Yunus

The team of  "AGFUND" discuss, chaired by Executive Director Nasser Bakr Al-Qahtani with the Sudanese side complete the contributions of the private sector in the Sudanese capital of the bank of the poor after it obtained the approval of the Central Bank of Sudan.

AGFUND

AGFUND has received the approval of a number of prominent Sudanese businessmen to contribute to the bank's capital.
The delegation will attend AGFUND in the Forum's seventh Islamic Development Bank to be held in Khartoum on Islamic finance and provides Qahtani and a paper on the successful experiences of AGFUND in the area of ​​job creation and social and economic impact of this experience, the most important obstacles to job creation is represented in (funding, training and rehabilitation, and the labor market ) will also speak about the role of microfinance and micro in the provision of employment opportunities.

Will address Qahtani Horizons initiative Prince Talal Bin Abdul Aziz, microfinance, which led to the establishment of 5 banks for the poor in the Arab region and Africa, (the National Bank to finance small projects in Jordan, Al-Amal Microfinance in Yemen, the Bank of creativity in Bahrain, Bank of creativity in Syria, the Bank of partnership and innovation in Sierra Leone. The pump "AGFUND" in the role of banks, 130 million, benefiting far more than a million in the poor.

The practice of AGFUND to establish banks for the poor on the principle of social investment, and therefore the profits went to the capital increase, and the disposal of the partners, and moreover they are Members of the Board of Directors of the private sector, and shareholders.

Believes that the AGFUND Bank for the Poor in Sudan carries a lot of the features of the success and development and expansion of Sudan because of the countries that created a legislative structure to promote microfinance.

It should be noted that Sudan has launched an initiative to support young people to do small projects to improve their social situation and fight against poverty.

The Sudanese government Spotted 12% of the budget of each bank to support the microfinance industry to advance its role in supporting young people and the fight against poverty and the empowerment of women, as was done at the crossroads of Islamic Microfinance, which concludes its work in Khartoum in the coming days with the participation of a number of experts, specialists and researchers in the field of microfinance experience Bangladesh Grameen Bank

Microfinance in Sudan

The support and banking institutions of the Islamic Microfinance in Sudan a major anchor to the success of microfinance has helped figure the more I said to the sustainability of microfinance projects

The microfinance institutions in Sudan services associated with the microfinance are on both sides of social and economic, such as education, health and combating poverty It also provides technical services such as training in providing funding, training and awareness to enable customers to benefit from funding in the specific project and its sustainability.

The percentage of beneficiaries 97% of the poor as a result of training, rehabilitation and education, most of the loans and mass less than 1% of individual loans

The Microfinance Network of Arab Countries "Sanabel" which will be Held Eighth Annual Microfinance Conference between 7th to 9th June 2011 in Jordan.

The Microfinance Network of Arab Countries "Sanabel" is The Largest Microfinance Network in MENA, which was established in 2002 by 17 microfinance institutions from Seven Arab countries as a membership driven regional network of microfinance institutions in the Arab world.

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The MasterCard Foundation will be providing MCF Management Scholarships for MFI Managers from Developing Countries to attend the 17th Annual Boulder Microfinance Training Program. This Program is held at the International Training Centre of the ILO (ITC-ILO) from July 18th through August 5th, 2011.

Celebrating 16 years of excellence, The Boulder Institute of Microfinance once again brings its renowned faculty and thought-provoking course offerings to the Boulder MFT in Turin, Italy.

This program offers a space for reflection and analysis dedicated exclusively to sustainable microfinance training where participants and world-renowned faculty are brought together to discuss and analyze issues surrounding Microfinance. This is an excellent opportunity for learning, dialogue, and debate with expert faculty and microfinance professionals from all over the world.

Source: Mix


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Microfinance

Morocco is one of the pioneers in the microfinance industry in the Arab world where Provide microfinance associations in Morocco, three types of Products:


known as the group solidarity apply the principle of solidarity among themselves, so that in case of failure to perform the due payment by an individual belongs to the same group is imperative for the rest of the group and Iwduha him. The group consists of 3 to 5 individuals - according to all the Assembly - and, in solidarity loan does not request any guarantees, but the only guarantee is the same group, ranging in value of loans granted between 1000 to 30000DHs period of time between 3 and 18 months, and is satisfied premiums loan on a semi-monthly or monthly.


Go and this type of loan at the beginning of 2006 and the reverse loan solidarity must be having a specific guarantees to benefit from this type of loan and can generally distinguish between the inside two types:

- Individual loan-oriented small businesses :

Is a loan intended for small businesses and micro enterprises for the development of their projects and business plans and small loans range in value between 1000 to 50000 dirhams in the time period between 6 months to 5 years. This type of loan should provide specific guarantees one Calcgel commercial or personal guarantees (such as the monthly wage ...).
In terms of the special conditions that must be provided in the beneficiary: it is to be the holder of entrepreneurship, and to be the capital of the latter than the predecessor.

-  Housing Loans:

Started work in recent years is directed to those who wanted to improve the residence, repair, or to link housing connected to drinking water, or electricity, ranging from the value of loans granted between 1000 to 50000 dirhams in the time period between 6 months and 7 years. The request is specific guarantees as collateral furniture for home or personal guarantees or to ensure a relative. These are the various financial services provided by microcredit associations in Morocco, in addition to the specific safeguards that should be available to take advantage of individual loan, which is in the development in Morocco since its inception in 2006, and to reduce the hardness in the performance of their clients, and the risk of debt recovery as well as financial services, Association provides microcredit, Morocco, non-financial services in parallel to the beneficiaries, such as training programs, guidance and counseling them through the field agents who are tracking the project, in addition to marketing the products of customer service at the regional level or national level, through the establishment of special exhibitions in this regard, we note In this regard, the "TASWIK" of the AL-AMANA, which was launched in 2008, which helps more than 200 customers in the industry of traditional marketing to sell their products, contributing to poverty alleviation.



is Modern Products in Microfinance in Morocco Like death and disability insurance and personal accident insurance, at 2 Euro (per year per product, and should cover the beneficiaries of microloans, up then do not qualify for hedge risks.

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Social Business

In recent times spread a new concept is linked to the microfinance industry, is "social business" concept, to learn more about this new concept take a look at the Wikipedia definition:

A social business is a non-loss, non-dividend company designed to address a social objective. The profits are used to expand the company’s reach and improve the product/service. This model exists in some countries (Italy and others), but has recently been revived from the work of Muhammad Yunus and others.

Social business is a cause-driven business. In a social business, the investors/owners can gradually recoup the money invested, but cannot take any dividend beyond that point. Purpose of the investment is purely to achieve one or more social objectives through the operation of the company, no personal monetary gain is desired by the investors. The company must cover all costs and make revenue, at the same time achieve the social objective, such as, healthcare for the poor, housing for the poor, financial services for the poor, nutrition for malnourished children, providing safe drinking water, introducing renewable energy, etc. in a business way.

The impact of the business on people or environment, rather than the amount of profit made in a given period measures the success of social business. Sustainability of the company indicates that it is running as a business. The objective of the company is to achieve social goals.

Source: Wikipedia

More than 12 Microfinance institutions and organizations signed An Open Letter in Support of Dr. Muhammad Yunus. A Bangladeshi court on Tuesday upheld an order removing Yunus as head of Grameen Bank.

Open Letter:
"Muhammad Yunus has diligently served the poor for decades. No one has done more to inspire generations to work to reduce poverty.

We are increasingly concerned and dismayed with the troubles Nobel laureate Muhammad Yunus is facing in Bangladesh. As we understand it, the Government of Bangladesh is resorting to technicalities to remove Dr. Yunus from the Grameen Bank, without presentation through legitimate and transparent legal processes of any evidence of wrong-doing.

We deeply deplore this lack of justice and unproven allegations that not only impugn Dr. Yunus' character and the integrity of his flagship bank, but reach much further. Forced removal creates unnecessary risk for the more than 8 million borrowers-owners of the bank. The Government of Bangladesh previously had respect for the bank's independence as a majority client-owned microfinance institution; it is our sincere hope that a return to the status quo can be made quickly.

Dr. Yunus has played a seminal role in the development and recognition of microfinance -- the provision of small, working-capital loans and other financial services for the entrepreneurial poor. He has our strong support, and our wishes for a just and speedy resolution to this sad turn of events."

Sincerely,

ACCION
Calvert Foundation
Co-Operative Bank
FINCA
Freedom From Hunger
Grameen Foundation
Grassroots Capital
Microvest Fund
Opportunity International
Pro Mujer
Triple Jump
Visionfund International
Women's World Banking

Low-cost insurance that covers the lives, health and property of the poor could provide protection against natural disasters.
In December 2010 devastating flooding in Colombia killed more than 200 people and left 1.7 million homeless. The damage caused was catastrophic, with 628 cities and towns hit by floodwaters, over 1,800 homes destroyed and a further 256,000 damaged.

Like the victims of most natural disasters across the world, the vast majority of those who lost relatives, homes and belongings, many of them poor farmers living in isolated rural areas, will receive no compensation for their losses and will have to rebuild their lives from scratch.

With the floods largely ignored by the international community, government assistance patchy and slow, and aid agencies struggling to fill the void, Colombia's insurance agencies are saying they can provide a much-needed safety net for when the rains return.

Microinsurance, low-cost insurance policies that cover the lives, health, crops and property of the most vulnerable, are being seen as a central way of providing social protection to the increasing numbers of people affected by natural disasters such as hurricanes, flooding and drought.

A recent report by the German insurance giant Munich Re calculated that 2010 was the second worst year for disasters since 1980. It reported that 950 global catastrophes had amounted to overall losses of around $130bn. Of this, only around $37bn was insured. For example, only 1% of the $14bn of property damage caused by Haiti's massive earthquake was covered by insurance.

At the Bonn climate change talks in 2008, microinsurance was touted as a central component of climate change adaptation measures in Africa, Asia and Latin America.

Yet while microinsurance has seen increasing success in Africa and Asia, it has so far failed to make significant inroads into the Latin American market. But this could be changing.

The Colombian offices of insurance companies such as Liberty and ESA have told journalists that they are seeing a spike in the number of people taking out microinsurance policies. ESA says it is selling more than 60,000 microinsurance policies a month, mostly health , for around $1 a month.

There are hopes that microinsurance could offer some form of social protection in other countries across the region. A government-backed scheme run by Peruvian insurance company La Positiva targets over one-third of Peru's 9 million rural population, offering micro-life insurance at a marginal cost of the income generated by a family's annual harvest.

The cost of the insurance, which is between $0.5 and $2 a month, is added to the water irrigation price already paid by the farmers. Brazil and Mexico have also been identified as huge markets for growth, with millions of potential customers.

Yet despite the buzz surrounding microinsurance, the industry's reach is still limited. The 150 million people currently holding policies represent only a small fraction (around 5%) of a potential market of up to 3 billion.

Unlike microfinance programmes that provide people with instant cash, the insurance industry has so far struggled to overcome the simple problem of trying to ask poor people to pay for something they might never use.

Richard Leftley, the chief executive of UK-based MicroEnsure, one of the leading microinsurance companies, says that it has all but scraped the idea of trying to sell policies direct. He says turning up in towns and villages and asking poor families to buy insurance simply doesn't work. "Trying to explain to someone with no prior experience of insurance that if you pay even just a little bit every month then someone will pay you back if your crops failed or your child is hospitalised is often met with a perfectly understandable 'yeah right' response," he says.

Instead, the industry is evolving, with many policies now being sold as add-ons to products and brands that people already use and trust. For example, MicroEnsure says it is now conducting most of its business in Africa through partnerships with mobile phone companies.

Phone companies trying to get people to stop using multiple sim cards and stay loyal to one air-time provider are offering life or health and disaster insurance as an incentive. People who buy credit for one month get a month's worth of insurance at no extra cost.

Other obstacles are also stunting the potential of microinsurance as a widely used financial service for those vulnerable to natural disasters.

Weather-based claims have proved tricky. Microinsurance companies have had to dictate levels of rainfall as a way of setting limits for claims. Leftley says problems have occurred when these limits haven't quite been reached yet farmers still believed their crops had been damaged and expected compensation.

Major insurance firms are still being put off entering the market because microinsurance claims have to have few, if any, exclusions. Claims have to be paid almost instantly. It only takes one company to fail to pay out to its customers for years of fragile trust-building to be destroyed in an instant.

Yet Leftley believes microinsurance's time has come. He points to the increasing backlash against microfinance as a "fix-all" solution to poverty as stories mount of families being put under unbearable and devastating pressure to pay back microfinance debts.

"I think credit has been seen as the easy solution for global poverty, and the micro-finance industry has been drinking its own Kool-Aid for a bit too long," he says. "While credit is the best option in some situations, people are starting to realise that there are other options – and this can only be good for the microinsurance industry."

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Source: Guardian