Micro-lender plans shake-up to meet Middle East needs

Microcredit lender Grameen-Jameel plans new products to better serve youth and small-and-medium enterprises in the Middle East

After 10 years of operations, Grameen-Jameel, the microcredit lender, is reviewing its operations in order to better suit the needs of the industry in the Middle East and North Africa region and Turkey.

The lender, which has been operating for 10 years, may seek new financial institutes to partner with and plans to develop new products with a view to better serving youth and small-and-medium enterprises (SMEs), said Fatina Abu Okab, deputy general manager and programme manager.

“Given the current challenges the industry in the Arab world is facing, we decided to revise our strategy based on those challenges and the evolving needs of the [microfinance] industry,” she said.

Grameen-Jameel provides financial and non-financial products and services to 21 microfinance institutions in the MENA region and Turkey with the aim of alleviating poverty. The company normally offers financial services through direct credit lines or guarantees and has reached more than 2.4 million clients through its microfinance partners.

“Based on current capital needs in the industry we are now providing this structure of financial products to meet the huge needs of capital funding,” said Abu Okab.

However, the company is revising the allocation of funding to microfinance institutions whereby it may improve the structure of products or provide new ones. “They [the products] are effective, but the need is increasing so we need to have balance between supply and demand,” she added.

The company is also looking at partnering with institutions to develop new financial products such as micro-insurance and loans that support the use of technology and renewable energy by the poor, Abu Okab said. “In the long-term, we are exploring opportunities for potential partnerships in order to serve the youth and SMEs in the MENA and Turkey,” she said.

Grameen-Jameel has disbursed in excess of $12.1m in loans and provided guarantees valued at more than $24.2m as of June 2014. More than 60 per cent of clients in its partner portfolio are female.

Abu Okab spoke on the sidelines of the 10th Annual Sanabel Conference in Dubai, where more than 350 participants gathered to discuss the current state and future prospects of the microfinance sector in Arab countries.