Amana Commercial Products
Since its inception in 1997, the Association Al amana commercial products has achieved impressive results in the development of sustainable financial services for the poor in Morocco. Today it is known among microfinance institutions in the MENA region communicating their results to the MIX as the most important in terms of loans outstanding and number of clients. Abdelmoumni Fouad, director of Al Amana, explains what are the key success factors of the association and demonstrates the opportunities for microfinance in the Arab world. FA: The main achievement of Al amana commercial products to date is to have demonstrated a very large number of men and women who need financial services and without access to capital, even for very small amounts. Yet the hard work and entrepreneurship we have seen in these people we can say that they are able to make productive use of that money. What we have managed to do is to show that they were solvent, respect their commitments and could be served on a large scale and on a sustainable basis. FA: First, there was simply a large majority of poor or low income in demand for financial services. We also benefited from a favorable environment in terms of human and technical resources, as well as politically and economically. In addition, we were given a clear objective: to provide financial services to the poor on a large scale and sustainable manner. This strong commitment has been a success factor. FA: Today we serve approximately 200 000 people, which sounds like a lot compared to other microfinance institutions. Yet this number is tiny compared to the mass of people who are still excluded from the financial system. In addition, we offer our clients mainly cash loans in small groups together. This offer is inadequate compared to the diversity of needs could be met with a wide range of services: investment loans, micro-leasing, micro-insurance, checking accounts, wire transfers, business support services . . . . FA: The easiest way would be to expand our existing core amana commercial products to more customers and increase the size of loans while maintaining the quality of our portfolio. However, we believe that our growth must result from an adjustment to our current credit methodology, the introduction of innovations and development of new services. Currently, we operate within a legal framework that allows us to offer only very small loans. I do not know yet if we will be looking to change their status in the future. I rather think that the regulatory environment needs to be changed. Today, our outstanding loans to customers amounted to $ 57 million, with an increase of 60 percent in one year. Given these results, everyone can only be confident that we can not continue to grow at this rate in the absence of regulatory changes to support our expansion. It is certain however, that these changes will require considerable effort on the part of our management and our board of directors and from the entire microfinance industry and authorities. FA: I would say: do not do anything new. Just do what has already been done and make the most of your experience, background and your local resources. I would add: be committed and conscientious in what you do. It is also very important to operate in accordance with best practice and adhere to basic principles approved by CGAP and its 29 members and the G8. Finally, a lesson that I would particularly emphasize: never claims that microfinance is a panacea. Microfinance is an important, but it does not meet all the needs of development. FA: First of all it is a huge market on which banking affect only 20% or less of the population. Second, the quality and potential for growth is enormous. Finally, investing in human resources will help reduce many constraints because we are constantly looking for qualified personnel with experience in best practices in microfinance and a good knowledge of the local context. FA: The countries that make up the region differ from each other in many aspects, including the regulatory environment, the degree of market development and access to finance. In some countries, binding ceilings are still in effect on interest rates, while in other markets have been liberalized. In some countries, the microfinance market has emerged, in others not. Some countries have very limited resources, others benefit from funds available credit high. Within three to five years, I see a trend of capital inflows into the amana commercial products sector. As a result, funds and development funds and cooperatives are likely to start losing ground to amana commercial products microfinance institutions, leaving the financial markets play an increasing role in expanding financial services to the working poor Arab countries. . . .
