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Newsletter April- June 2019

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1. Funds and grants

 

Due to increasing demand by SME owners for financial services, and a shortage of funds to meet demand by microfinance institutions (MFIs), SMED has funded both Hadramout MF and Al-Ittihad MF programs and Nama MF Foundation for a total of YR 918,000,000 during the quarter. In terms of grants, SMED has provided during the quarter grants to Yemen Loan Guarantee Program (YLG), Al-Ittihad MF Program, National MF Foundation and Nama MF Foundation totaling YR 214,223,737. The grants were meant to finance their activities in the field, rural expansion, marketing and promotion activities, and improve governance. Other grants were also provided amounting to 35,152,734 YER for the formation, training and monitoring village savings and loans associations (VSLAs). The grants were also disbursed to sustain other activities, such as: supporting the expansion of financial and non-financial services in the areas of Integrated Interventions, development of IT systems in MFIs, support of Thimar MF Program, field validations of MFI loans and loans of war-affected clients. The total number of active clients at microfinance banks, programs and foundations at the end of June 2019 has reached 85,097 active clients, of which the percentage of women was 41%, totaling YR 15.98 billions.

 

 

 

2. Support for war-affected clients (Phase 2)

 

During the second quarter of this year, 189 clients have been compensated, of which %33 were women, totaling USD 105,000. At the end of June 2019, the cumulative number of beneficiaries supported has reached 4,028, totaling USD 2.2 millions. The project has achieved its target of compensating 4,000 SMEs affected by the War with in-kind grants to re-launch or expand their businesses, and help them restart their activities.

 

 

3. Support the expansion of financial and non-financial services in the Integrated Intervention Areas Program

 

During the quarter, SMED has continued its support for the expansion of financial and non-financial services in the integrated intervention areas in the governorates of Dhamar, Ibb, Amran, Lahj and Hadhramout by conducting field follow-up visits to evaluate the village savings and loan associations (VSLAs) and their activities. The number of groups formed during has so far reached to 83, comprising 1,947 members (men and women) in the aforementioned governorates. The groups have so far accumulated about YR 20 millions. In addition, 234 electronic accounts have been opened via mobile phones for the beneficiaries of the Cash for Work Program.

 

 

4. Internal Audit Activities

 

In order to verify the integrity of internal control procedures and obtain reasonable assurances on the data of a number of MFIs, a financial and administrative evaluation of the activities of Yemen Microfinance Network (YMN) and Hadramout MF Program was conducted. Also, a field validation was carried out at the Nama Foundation on 207 clients at branches of Sana'a. In addition, a training project was developed to qualify consultants in field validations of clients in order to expand the base of consultants able to carry out field validations of MFI clients.

 

 

 

5. Thimar MF Foundation

 

In order to ensure that the continuous provision of financial services by SFD in the Governorate of Taiz for income-generating activities, SMED has developed a project to establish a new foundation (Thimar) in place of Al-Awael Microfinance Company, which was suspended due to the security unrest in Taiz.

 

 

6. Development of the computerized automated systems

 

1.6  The Desktop Recognition System

 

SMED has continued to develop and test the applications, both using the fingerprint or eye print. The aim of the system is to facilitate the registration and verification of microfinance clients. This will play a major role in facilitating lending procedures. SMED has developed a computerized mechanism that extracts the data from the Computerized Accounting and the Loan Tracking systems, and inputs them in the SEEP monthly reports, which are currently inserted manually by MFIs. The mechanism has been tested in Azal MF Program.

 

 

2.6  Computerized input mechanism for the SEEP monthly reports

 

SMED has developed a computerized mechanism that extracts the data from the Computerized Accounting and the Loan Tracking systems, and inputs them in the SEEP monthly reports, which are currently inserted manually by MFIs. The mechanism has been tested in Azal MF Program.

 

 

3.6  Developing the SMED English website

 

During the 2nd quarter of 2019, the English version of the SMED website has been developed further, including updating data and indicators, as well as adding success stories.

 

 

4.6  Design of the agricultural loan application using the mobile phone

 

The development of the mobile application for agro-loans has been completed and tested in more than one institution. This mobile application will help automate and speed up the loan application process in the field for loan officers, and raise the efficiency and accuracy of work.

 

 

5.6  A workshop on the mobile application for agro-loans

 

After having trained loan officers from the National MF Foundation in a previous workshop, SMED carried out a three-day training workshop for 8 loan officers from Azal MFI.

 

 

7.  Development of marketing and public Relations Activities of MFIs

 

SMED has established a project aimed at increasing promotion, marketing and public relations activities targeting a number of microfinance institutions and programs (National, Nama, Hadramout, Al-Ittihad, Azal). The final aim of the project is to give MFIs the necessary skills to build a positive image in front of donors in order to attract more funds, improve their relationship with stakeholders, and be able to attract more clients. During the quarter a total of USD 49,200 was disbursed to NMF and Nama.

 

 

II. Yemen Loan Guarantee Program (YLG)

 

YLG is the first program in Yemen that provides guarantees to clients whose guarantees are not sufficient to obtain a loan, or are unable to provide guarantees. During the second quarter, YLG has provided guarantees for 179 borrowers, amounting to YR 236,492,998. YLG also signed partnership with four MFIs: Hadramout MF Program, Al-Ittihad Program, Nama Foundation, and the Bank of Yemen and Kuwait. YLG also organized a workshop for the VOLIP partners to discuss the challenges and constraints they face during the lending phase. In addition, YLG has initiated the registration procedures for membership of the Global Network of Guarantee Institutions (GNGI). Finally, a number of the staff members have participated in a training course in Egypt on Credit Risk Assessment and on Countering Corruption.

 

 

III. Yemen Microfinance Network (YMN)s

 

In continuing its role promoting the MSME financial sector in Yemen, YMN carried out several training course during the 2nd quarter of 2019, as follows:

 

 

1.  Emergency Response Project

 

During the quarter, YMN has continued to implement and finalize the First Phase of the project. The Social Fund covers the cost of compensating those MFI clients who have been affected by the War, while YMN directly implements the disbursements. During the quarter, the network has launched the Second Phase of the project, in which 2,000 MFI clients are expected to be compensated by the end of 2019.

 

 

2.  Risk Assessment – Egypt

 

In collaboration with Prima Foundation, and with the support of MEDA Foundation, YMN has coordinated during the second quarter a -3day training course in Cairo (Egypt), where participants from a number of Yemeni MFIs were trained on Risk Assessment Mechanisms.

 

 

3.  Accounting for non–Accountants

 

A training session in this field was implemented by YMN in Seiyun. The course targeted non-financial staff in MFIs, with the aim of introducing them to the basic concepts of accounting.

 

 

4.  Customers Service

Another training course was conducted by the network in Seiyun dealing with customer service in MFIs. The course targeted those in the sector requiring direct communication and dealing with customers, by developing their in identifying customer needs and problems, and providing quality services to different types of microfinance customers.

Small and Micro Enterprise Development Unit

Republic of Yemen

Social Fund for Development

Sixty street,Faj attan, Sana'a,Yemen

Tel :967-1-449669

Fax : 967-1-499670

 

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