In the past, microfinance institutions (MFIs) have focused largely on providing loans to their clients. However, MFIs are often criticized for their high interest rates and lack of other financial services such as savings accounts or insurance. Local governments, MFIs and not for profit organizations like MEDA are working to establish a set of microfinance best practices including the regulation of some MFIs as deposit-taking institutions. The benefits of this are two-fold: clients have a safe place to save their money and are offered reduced interest rates on loans.
Financial Services - Current Projects
Electronic payments (e-payments) are transactions that occur without cash through a debit or prepaid card, a voucher, a mobile phone, or through an electronic-funds transfer (EFT). E-payments increase access to formal ways of saving and sending money, thereby reducing the risk of loss or theft of cash and increasing the ability for individuals to plan and save for the future. Individuals without bank accounts often do have access to mobile phones.
The overall objective of Themar is to help transition Yemen to a non-oil economy through the creation of an environment conducive to private sector development and job creation, which could eventually lead to poverty reduction.