Therefore, projects aiming to reduce poverty in Yemen are the core of any solution and that’s what exactly Yemen Microfinance Network (YMN) is doing. Under the patronage of Abdul Karim al-Arhabi, Minister of Planning and International Cooperation, YMN launched its work, last week.
The government of Yemen represented by the Social Fund for Development (SFD) and the United Nations Develoment Program (UNDP) initiated a joint 3 years project to established the first national network in the country, YMN.
YMN’s essential goal is to establish a wider “inclusive finance sector” in Yemen and to address the issue of capacity building transparency to increase the outreach of microfinance services in the country.
In Yemen Microfinance began in 1997 with SFD, which is considered as the pioneer of microfinance in Yemen. Represented by the Small and Micro Enterprise Development (SMED) unit, SFD with the aid of different donors began microfinance with the initiation of small programs in different governorates. Successful programs later transformed into microfinance institution (MFIs). Currently, there are 11 microfinance institutions comprising of one specialized microfinance bank, one commercial bank, one foreign exchange company (transformed into a microfinance bank), six NGO programs, one company and two foundations.
The project aims to build supportive infrastructure necessary to enhance the capacity of local institutions to provide a range of financial services and products to the entrepreneurial poor, in a cost efficient manner, thereby increasing sustainable access to finance and enhancing the scope for participation of youth and women in economic activities. Microfinance, a global developmental activity, is the provision of financial services to low-income clients who traditionally lack access to mainstream banking and related services. Microfinance which includes credit, savings and insurance helps clients in engaging in productive activities or grow very small businesses. This is considered as one of the most innovative and effective ways to reduce poverty and unemployment, increase income and contribute in supporting the state’s economy.
YMN is a member based association registered in 31st August 2009 under the Ministry of Social Affairs and Labour as a non-governmental organization, having its own board of directors, consisting of the microfinance member institutions. Being a member-driven association, YMN three year strategy was developed in a very detailed, comprehensive and systematic process.
The situation analysis entailed a series of individual meeting and discussions on the key challenges, needs and expectations. Key stakeholders including NGO programs, MFIs, Microfinance Banks, Commercial Banks and Microfinance Companies, Institutions involved in technical assistance, SDF and the UNDP were part of the strategy development.
In a series of meetings with management, staff and clients of MFIs during this situation analysis these primary stakeholders of the network identified ‘Training and Capacity Building’, ‘Technical Assistance’, Lobbying and Awareness’ and ‘Linkages with Internal & External Players’ were outlined as four major strategic issues behind lack of substantial outreach of microfinance services to the poor of the country.
YMN’s vision is sustainable access to diverse quality financial and non-financial services to all the poor. Some of its core values committemnet to alleviation of poverty, gender equity and non-discriminatory services to all and excellence.
YMN’s donors are SDF, UNDP, Sanabel; the Microfinance Network of Arab Countries and Small Enterprise Education Promotion Network (SEEP).
Rania Abdel-Baqi, Executive director of Sanabel; the Microfinance Network of Arab Countries, said, “The project aims to reduce poverty in all areas; urban and rural. Our partnership with YMN will help in setting crucial strategic plans at the field of poverty and how to reduce it.
Osama al-Shami, Microfinance Network Head said, “13 years ago, there wasn’t an institution that cateres to people’s financial issues and provide access to projects’ funds and here we are today witnessing this launching. It represents the greatest finical service for poor people. Men and women are alike welcomed to be part of this project and our services include different kinds to give people more chances to make use of our work and realize their dreams by our funds.”
UNDP’s programs representativ, Ms. Pratibha Mehta said, “I congratulate everyone who was part of this program. It plans to create jobs creation among men and women. Biascally, it builds confidence and dignity. It’s still the youngest among the region but we look forward to seeing it grow bigger. No doubt, UNDP has always supported programs of such and this was another chance or us to demonstrate our support for such programs, especially funded by the country’s Social Development Fund. Our ultimate goal is to reach out the maximum poor and vulnerable people in Yemen and achieve one of the Millennium Development Goals (MDG).
Mohammed al-La’ai, YMN’s chairman, “By establishing this program, the result was new contributors to the financial service including the private sector, loans rate increased 35% from January 2009 to June 2010 and that increased establishing loans number to more of 320 thousand laons costing more than 20 milliar ryal.
