SPECIAL REPORT: ACRE Africa, Bima, Microfact, Tech-Innov, UTM, Others Report on New Products for Rural Areas at Semaine Africaine de la Microfinance (SAM) in Dakar, Senegal

As Semaine Africaine de la Microfinance (SAM) began to draw to a close, a range of service providers described their new products and services at an all-day Innovation Fair.

Solenn Marquette of Bima, a Sweden-based insurer operating in 13 developing countries, explained her firm’s strategy for using mobile phones to sell insurance. Although building branches is too expensive, “we still put education teams on ground” to market products. One such product is Tigo Hospitalization, which is offered in Senegal starting at CFA 200 (USD 0.40) per month for up to CFA 30,000 (USD 50) in coverage.

Stella Wambui Ndirangu of Kenya-based Agricultural and Climate Risk Enterprise (ACRE) Africa explained that her team found marketing to individuals was too expensive, so it now brings on customers through aggregators such as financial institutions and suppliers of farm inputs. Some retailers of seeds and fertilizer include the cost of the insurance in their goods. A seed packet might cost KES 420 (USD 4) including insurance. A card in the packet explains how to register for coverage via mobile phone. Some membership organizations pay the premiums as a service to their members, in which cases they collect customers’ phone numbers, planting dates, etc. “The aggregators do a lot of work; this saves us on human resources, which is expensive,” explained Ms Ndirangu. Her customers report investing 20 percent more in their farms and earning 16 percent more profit, with average insurance coverage of USD 100.

Moulaye Keita of the Union Technique de la Mutualité (UTM), an association of mutual societies in Mali, described the challenge of getting members to pay their monthly insurance premiums of CFA 575 (USD 1) per person. The cost of taking a bus or taxi to visit a branch could dwarf the cost of the insurance. So UTM looked into offering bank transfers, but banks proposed charging CFA 3,000 (USD 5) per transaction, an even worse proposition. Thus in 2014, UTM forged a partnership with the Malian arm of French telecom Orange to allow members to make payments from anywhere in the country by entering into their phones a text code, their account number, the amount of the payment and their Orange security code. In contrast, Ms Marquette explained that Bima draws premiums directly from customers’ mobile phone credits. Under this scenario, no payment reminders are necessary. Customers receive a text message confirming each transaction.

Other presenters at the Innovation Fair included Abdou Maman Kane of Tech-Innov, a firm in Niger that installs irrigation systems that can be controlled by mobile phone, and Kurt Moors representing Microfact, a collaboration of Luxembourg’s ADA and Belgium’s BRS that offers free and fee-for-service tools for managing microfinance institution data.

This is the last in a series of a sponsored series on the second SAM, which was held from June 29 to July 3 in Dakar, Senegal, by ADA in partnership with the African Microfinance Network, the African Microfinance Transparency Forum, the African Rural and Agricultural Credit Association and the Microfinance African Institutions Network (MAIN). MicroCapital has been reporting on SAM live from Dakar, and there will be a special review of the event in the July 2015 issue of the MicroCapital Monitor.

Additional Sources and Resources:

African Microfinance Week Website: http://www.microfinance-africa.org

MicroCapital Coverage of African Microfinance Week: https://www.microcapital.org/category/semaine-africaine-de-la-microfinance-sam/

Do you know that MicroCapital publishes the MicroCapital Monitor newspaper each month? Find out more at https://www.microcapital.org/products-page/

Similar Posts: