What is the collection average rate of the Microfinance firms in Jordan?

Introduction:
I would like to present a brief general presentation about the Microfinance in Jordan.
First I will talk about the Microfinance in the Arab world and how did it reach specifically to Jordan.
Then, I will mention the microfinance companies in
Jordan: their policies, organizational structure and their difficulties.
And finally I will explain how these difficulties have been solved by Delta Informatics.

Recipient of Nobel Peace
Prize in 2006, recognized for his work in poverty and the empowerment of poor women since 1976. He created the Grameen
Bank, a micro-credit institution that provided small amounts of working capital to the poor for selfemployment. Grameen
Bank has loaned out over
6.5 billion dollars to the poorest of the poor.
Muhammad Yunus is a member of the Board
Directors for several companies in Jordan.

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The Microfinance network of Arab countries
Sanabel was established in 2002 when 17 representatives from seven Arab countries gathered in Tunisia to launch a network designed to serve microfinance institutions in the
Arab world.
Sanabel organizes an annual conference of Arab
Microfinance practitioners every year in a different Arab country.
The first Sanabel’s annual conference was held in the Dead
Sea in Jordan in 2003. "Shaping the Industry's Future" was the theme of the conference. During this three-day conference, microfinance practitioners and experts, donor agencies, investors and government officials came together to discuss the development of best practice microfinance in the Arab region.

YEAR COUNTRY THEME
2003
2004
Jordan
Egypt
Shaping the Industry’s future
Microentrepreneur awards
2005
2007
2008
2009-
May
Morocco
Yemen
Tunisia
Lebanon
From Microcredit to Microfinance in the Arab Region
Serving the Poor: 10 million clients by
2010
Advancing Arab Microfinance: Greater
Social Impact through Inclusive
Financial Services
Human Capital in Microfinance:
People, Passion and Value

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Membership in the network is limited to the founders and any MFI who applies for membership and fulfills certain criteria.
Today Sanabel has expanded and has members in Egypt, Iraq,
Lebanon, Mauritania, Morocco,
Palestine, Saudi Arabia, Sudan
,Syria, Tunisia, Yemen and Jordan.

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1- AHLI Micro Financing Company -1999.
2- Jordan Micro Credit Company
(Tamweelcom)-1999.
3-Microfund For Women -1994.
4- Middle East Micro Credit Company -2000.
5- National Micro Finance Bank
(Al-Watani) -2005.
6- Development & Employment Fund
(Reyada) -1989.
7- Finca Jordan-2007.

Company
Ahli
Mmco
Jmcc
Mffw
Def
Nmb
Finca
N.
Branches
8
Active
Clients
5200
6
16
17
15
8
7
5000
44000
33000
40000
15000
13500
Loan
Process
Loan’s period
2 weeks 6 -36
Months
3 weeks 6 – 36
Months
1 week 2 – 48
Months
1 week 2 – 48
Months
1 month 6 – 72
Months
2 weeks 6 – 36
Months
1 week 2 – 36
Months
Loan
Amount
500-
15000 $
500-
15000 $
300 –
40000 $
200 –
30000 $
500 –
75000 $
300 –
15000$
300 –
15000$

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By end of 2008, the total sum of Active
Clients = 160,000.
By end of 2008, the total amount of loans that were declined =
100.000.000 JD.
By March 2009, the amount of new loans
= 20.365.000 JD.

Financial Services:
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Loans
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Interest rate average for a
Loan depends on the policy and product: 5-20% per year.
Non Financial
Services:
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Life Insurance
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Show rooms
Buzzards
Business linkage
Training courses
Trips for ideal clients .(as a compensation)

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Individual Loans:
Men & Women
Business owners
House hold Loan
Existing projects
Start up projects (Grace period up to 6 months)
Seasonal loan (Ramadan)
Vehicles Loans
Agriculture Loans
Group Loans:
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For women only
2-5 persons
House hold loans: knitting
Agriculture loans: cows, sheep, camels..

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Only 2 companies in Jordan provide a loan as an Islamic Product.
1.
2.
3.
DEF
NMB
FINCA (In the future)
The Islamic Product is named
“Morabha”.

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This product provides people who would prefer to apply the Islamic way since they do not agree to take a loan with a certain percentage of interest.
They can choose the Morabha.
Morabha includes in it’s contract 3 subjects: the company, the trader and the client.
The company buys the product from the trader and resale it to the client when the purchase price is known and must be agreed upon in advance. The profit is around( 6%-7%).

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The vision and the mission of the microfinance companies in Jordan are quit similar in their targets.
The vision is to improve the low income and productive poor people’s social and living standards through micro and small sized enterprises.
The mission is to provide the financial and non financial services to the Jordanian's lowest income so they can create jobs, build assets and increase their income.

1.
2.
3.
4.
Competition
Similarity in their products
Division by areas. (North, Center and South)
Duality of a client.

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The client can be so “clever”: go to a company to ask for a loan and right after he signs the contract, he goes to another company and asks for another loan. This is what we call Duality.
In order to stop this duality, all companies had to sign an agreement at the Ministry of Planning in accordance with
Delta’s company in 2007

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Delta is an informatics company, that provides to all companies an online contract of an active client: In a case a client has signed an agreement with one company, can’t go to another company unless he has finished his active payments.
Since it was established in Amman in 1993, Delta
Informatics has helped the firms achieve a competitive advantage through the following issues:
1. Reduced costs
2. Increased productivity
3. Higher revenues

The average
Of the collection rate is:
92% - 99%.

The Answer is:
The Organizational Structure in all firms.

Board of Directors
External Auditor General Manager Internal Auditor

General Manager
Operation Department
Finance Department
M.I.S Department
Marketing Department
H.R Department

Operation Department
Operation Manager
Credit Manager
Branches Managers
Supervisors
Loans Officers

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Jordan is well known as a supportive and active client of the world’s Microfinance.
Microfinance in Jordan is specialized with it’s organizational structure.
Their Vision and Mission are to create and build strong financial projects and products in Jordan.
Companies know how to overcome their difficulties and they reduce poverty in
Jordan and that’s how they accomplish their goal.

Samer Abu Dalo