Providing microloans is FINCA’s main financial service, however we have always been at the forefront of developing additional products and services to ensure our clients have a safety net for unanticipated emergencies. FINCA pioneered microinsurance in the late 1990s, because we had seen how natural and manmade disasters, as well as illness and death, could impact our clients’ families.
In communities like Mbeya, Tanzania, fire is a serious risk. Markets are cramped and often made from wood, allowing fires to spread rapidly. Commodities traded, like textiles, food, plastic wares, rubber shoes, paints, hardware and household items, are often highly flammable and packed in cardboard boxes. Once a fire begins, there’s not much to keep it from spreading quickly throughout an entire area.
In September 2011, a fire at SIDO Market in Mbeya wiped out businesses belonging to more than 1,700 traders, among them about 70 FINCA Tanzania borrowers. More than 1,300 stalls were completely destroyed by the fire, which raged for eight hours.
Thankfully, the FINCA Tanzania borrowers had credit-life insurance incorporated into their FINCA microloans, and soon discovered that the insurance policy would pay the outstanding loan balance, and new loans would be provided to rebuild their businesses.
While rebuilding could take some time, FINCA Tanzania’s clients say they are grateful that they can begin anew, and happy that FINCA provides them with such an important benefit.