Blog: Finance for Refugees, workshop for MFIs from Jordan and Lebanon

11 July, 2018

Just before we reach Zataari camp in Jordan, 15 kilometres from the Syrian border, four army helicopters are on patrol. It is only one of the signs of the actual tensed situation where we see that ‘Jordan is living on the edge’, as Queen Rania recently stated in her speech. The amount of foreign born residents that Jordan hosts is over 1,5 million (in a country with approximately 9,5 million inhabitants). Most of these people are living outside the camps. Lebanon is also dealing with a huge influx of people that seek refuge from the war in Syria. The burden for these countries to host so many refugees is enormous. Even with the support of international organisations.

How can we, as Financial Inclusion sector, contribute to being part of the solution? Access to financial services, like cash transfers and loans, could offer people a possibility to start building their lives again. This, in turn, can offer them a feeling of dignity, being able to be in control of their own future.

In the days that followed our visit to entrepreneurs in Zataari camp, we discussed with representatives from 11 Jordanian and Lebanese microfinance institutions (MFIs) what they need to start including refugees in their client base and/or to scale up their current efforts to finance them. During a 2-day workshop we aimed to gain good insights on the possibilities to provide financial services to refugees, what kind of products are needed and to determine the obstacles and required interventions for MFIs to serve a new target group.

The pain points raised by almost all the MFIs include external and internal issues:

  • On an institutional level, there is a lack of operational know how, how to segment properly, how to adapt your current policies and product portfolio, how do you organise your risk management, etc.
  • Enabling environment must provide enough comfort for MFIs; buy in of government bodies must be in place. And their policies must be aligned when it comes to e.g. supporting entrepreneurship of refugees. Or what will happen in case of a mass return of refugees? Can we organise coverage of such a political risk, e.g. with the support of the World Bank? Flight risk is perceived as the most prominent risk by MFIs preventing them from financing refugees. Research shows that worldwide the average performance of portfolios of MFIs financing refugees are similar to their normal portfolio. Sharing data (on market, segmentation, etc.) with the MFIs taking part in the workshop provided them with valid facts and figures to determine whether they want to move into this segment.

And clearly, access to capital is an issue; not only do MFIs have an identified need for Technical Assistance, but in addition, if they want to expand their business, they need equity investments and loan capital (in some cases with a form of guarantees or first loss).

For most of the attending MFIs, providing finance to refugees is uncharted territory. They could learn and exchange ideas with two front runners in this field: both Al Majmoua (Lebanon) and Microfund for Women (Jordan) shared how they have dealt with the many issues that they have ran into. The other MFIs asked lots of questions and by the end of the programme, the mindset of many participants changed into a positive attitude towards the possibilities of financial inclusion of refugees. The outcomes of the sessions were shared with investors. Not only the need for capital (blended structures) was addressed. A clear message expressed by the MFIs was the call for coordination on donor and investor level.

The outcomes of the workshop will be further discussed during the Conference ‘Finance for Refugees; making it work’ on 7 September in The Hague. If you want to learn more about the efforts of Dutch investors and other organisations, send an email to

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