Silatech and the Deutsche Gesellschaft fur Internationale Zusammenarbeit GmbH (GIZ) have signed an agreement with Al-Amal Microfinance Bank (AMB) and Al-Kuraimi Islamic Microfinance Bank (KIMB) in Yemen to provide financial access to tens of thousands of young Yemenis through an innovative new youth savings program.
The main objective of the program is to allow young Yemenis between the ages 18 and 30 to build their financial assets and encourage active.
The initiative will enable young Yemenis aged 18-30 to build their financial assets by opening a youth-specific savings account at any AMB or KIMB branch across the country. Set to be available for youth by the end of summer 2012, these Youth Savings Accounts (YSAs) include features specially designed for young people, including a very low minimum opening balance, a voluntary lock-in mechanism, as well as a range of incentive mechanisms which encourage youth to open an account and to continue saving over the long term.
The YSAs will be promoted through an extensive marketing campaign stressing the benefits of savings for young people and encouraging them to save more. The program will further partner with media outlets, educational institutions, the Yemeni Microfinance Network and other youth organizations to raise awareness and promote savings among young people.
Combined with similar programs supported by Silatech and GIZ in Morocco and Egypt, these new Youth Savings Accounts represent one of the largest new financial product deployments in the Middle East and North Africa (MENA) region.
In addition to directly serving youth in Yemen, the initiative is expected to catalyze other forward-thinking financial institutions and youth-serving organizations to think about helping young people to learn smart financial habits early on in life, as well as to make available savings schemes that will help them accumulate capital for starting a business, getting married, or help in other important life stages.
Silatech's Chief Executive, Dr. Tarik Yousef said in a statement: "Micro-savings are widely recognized as driving financial inclusion by providing an entry point into the formal financial sector, reducing vulnerability to economic shocks, evening out irregularities in income, and creating collateral for lending to support business start-up and growth."
He continued: "Yemen continues to be a market leader in the provision of innovative microfinance products, particularly those targeting youth. It's with great pleasure therefore that we at Silatech enter into this partnership with two of its leading microfinance institutions."
Mohammed Al-Lai, the CEO of AMB, said in a statement, "When we deployed our first youth-focused financial services, we were somewhat skeptical about their long-term viability. However, our experience has shown that youth have proven to be excellent, reliable clients of AMB.
He added: "We are delighted to be involved in this initiative, which builds on an already successful pilot project developed by AMB with support from Silatech that has seen more than 9,000 youth provided with access to dedicated savings accounts."
Yousef Al-Kuraimi, the CEO of KIMB, also commented,"With their relative lack of assets or collateral, youth clients are often among the most vulnerable. Therefore, we're glad to take part in a new program that helps to spread a culture of savings amongst youth,integrating them into the formal financial system through simple and attractive products." (qna)