MICROCAPITAL BRIEF: CelsiusPro Partners with BlueOrchard to Manage KfW’s Climate Insurance Fund (CIF), World Bank Group to Improve Agricultural Insurance in Ukraine

Swiss microfinance investment manager BlueOrchard and Swiss weather index insurance service provider CelsiusPro recently were appointed as co-managers of the Climate Insurance Fund (CIF), an initiative created by German development bank Kreditanstalt fur Wiederaufbau Entwicklungsbank (KfW) that aims to reduce the vulnerability of micro-, small and medium-sized enterprises (MSMEs) and low-income households to climate change by improving access to and use of insurance. As of February, funding streams of USD 60 million and EUR 17.5 million (USD 18.9 million) have been committed to the fund for investments and technical assistance, respectively.

Additionally, the Eastern European Access to Finance Project, a subset of the US-based World Bank Group’s Finance and Markets Global Practice, recently signed an advisory services agreement with CelsiusPro to improve the affordability of agricultural insurance in the Ukraine. The objective of the initiative is to improve coverage for crop yield shortfalls and to train insurers to improve sales of agri-insurance products in the country. The project will be implemented by the International Finance Corporation (IFC), a member of the World Bank Group, in conjunction with the governments of Austria and Hungary.

According to a statement by Mark Rueegg, the founding CEO of CelsiusPro, “We want to enable local insurers to offer yield shortfall covers, not only to the largest firms, but also to mid-sized and small producers. Our firm offers a chain of services from data sourcing, index, and policy design to the automated handling of policies via one platform. Streamlining design, calculation, and policy management processes via our technology is what ultimately reduces costs and makes index insurance affordable.”

As of September 30, 2013, BlueOrchard has disbursed approximately USD 2 billion in loans to microfinance institutions in 50 countries. CelsiusPro partners with insurers, government agencies, agriculture companies, and insurance brokers to provide solutions for index insurance, which uses data analytics to make insurance produces more widely available at a lower cost.

By Ananya Tiwari and Charlotte Newman

About BlueOrchard: BlueOrchard is a Switzerland-based, commercial microfinance intermediary that provides loans to microfinance institutions through its subsidiary BlueOrchard Finance S.A. and invests in the equity of microfinance institutions and microfinance network funds through its subsidiary BlueOrchard Investments S.A. BlueOrchard had approximately USD 2.5 billion under management as of year-end 2014.

Sources and Additional Resources:

Direct communication with CelsiusPro.

IFC Press Release: World Bank Group, CelciusPro Partner to Expand Access to Finance for Ukranian Farmers by Innovative Agri Insurance

Product MicroCapital Universe Profile: BlueOrchard

MicroCapital Universe Profile: KfW

MicroCapital Universe Profile: International Finance Corporation

MicroCapital Universe Profile: World Bank Group

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