Jordan Times
Thursday, May 3, 2007
Queen co-chairs launch of
Village Banking Campaign
AMMAN (JT) — Her Majesty Queen Rania on Wednesday co-chaired the launch of the
Village Banking Campaign, where FINCA International (Foundation for
International Community Assistance) announced it would bring its considerable
microfinance expertise and resources to Jordan and the broader Middle East. In
addition, international insurance giant AIG (American International Group, Inc.)
pledged its support to expand micro-insurance products through a $1.5 million
grant.
The announcement was made at New York University yesterday in the presence of
the Queen Rania, who co-chairs the campaign and its steering committee with
FINCA International Ambassador of Hope Natalie Portman.
Prince Zeid Raad, Jordan’s ambassador to the United States, and Princess Sara
Zeid were also in attendance, along with several students from public and
private universities in the New York area who are affiliated with microfinance.
“I know that creating opportunity in my region is not an option; it is a
necessity… [and] it is clear that programmes like FINCA can help lay a firm
foundation — for employment and empowerment and self confidence and hope,” said
Queen Rania, who is a long-time supporter of microfinance and member of FINCA
International’s board of directors.
“To my mind, microfinance is both a sound and a smart investment – not only in
lifting the lives of the working poor, but in stitching together the fragile,
fraying seams of our troubled world,” she added.
The Village Banking Campaign’s goals are to operate 100,000 Village Banks,
serving those living on less than $2 a day, annually by 2010, which will allow
all of FINCA’s subsidiaries on four continents to be financially
self-sustaining, unlocking capital markets and expanding outreach to millions
more people.
The Queen also referred to some of the success stories she has seen during her
visits to microfinance beneficiaries in Jordan, Kosovo and Mexico over the
years.
“I know there are resourceful women and men across the Arab world who are eager
to start small businesses of their own –— if only someone gives them a chance,”
she said.
Expressing her pride that FINCA Jordan will soon be opening its doors, the Queen
spoke about the need to give Jordanians the promising future they deserve.
“While the solution to that ‘macro-challenge’ cannot be microfinance alone, it
is clear that programmes like FINCA can help lay a firm foundation for
employment, and empowerment, and self-confidence and hope,” she said.
Village Banking is a unique and transparent method of microfinance that puts
loans as small as $50 in the hands of very poor families through community
financial associations in which loans are guaranteed by the recipients
themselves.
More than 91 cents of every dollar donated to FINCA goes directly to loan
capital, and approximately 97 per cent of loans are repaid, an extremely high
figure compared to commercial loans, and one of the highest repayment rates in
the industry.
The campaign’s goals also include expanding into new regions, including the
Greater Middle East and Asia. FINCA’s entry into Jordan will extend the delivery
its best practices to a region still in its infancy within the microfinance
community, but one that is currently outpacing outreach in Central Asia and
Eastern Europe.
“Our commitment in opening a microfinance programme in Jordan is to introduce a
broad array of products and services that will be rooted in the needs and
regional customs of the people of Jordan. We bring more than two decades of best
practices and technical assistance to this fledgling programme, and are excited
about introducing new products and strategic alliances to the country,”
executive director Rupert Scofield said.
For the past 10 years, FINCA and AIG’s strategic alliance has provided the
working poor with a range of insurance products that reduces their vulnerability
to economic shocks such as risks from natural disasters, loss of income due to
injury, life-threatening illness and death of the main income provider and the
destruction or loss of business assets, which threaten to push them back into
poverty.
AIG’s additional $1.5 million grant will enhance FINCA’s capacity to offer a
wider range of micro-insurance products to an increasing number of the world’s
working poor so that, for the first time, they have access to a safety net.
The AIG grant also provides for education training for Village Banking staff and
clients to ensure micro-insurance clients are properly prepared to grow their
businesses, and strengthen the Village Banks’ institutional risk management
programmes to help the campaign meet its goals.