Short-Term and Long-Term Financial Instruments to Build Resilience: The Role of Insurance and Micro-Pensions Toward Financial Resilience of Low-Income Groups

Fiw Topics

Insurance
Social Protection

FIW Year

2024

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Summary + Key Findings

The session focused on short-term and long-term financial instruments, emphasizing the role of micro-insurance and micro-pensions in enhancing financial resilience for low-income groups.

📊 Financial resilience encompasses both immediate recovery strategies and long-term stability planning, crucial in today’s volatile economy.

📉 Only 10% of people in low-income countries have access to insurance, highlighting a significant protection gap that needs addressing.

🤝 Collaboration between private sector, governments, and NGOs is vital for creating sustainable financial solutions that cater to the needs of low-income populations.

📱 Leveraging technology, like mobile platforms, can significantly enhance accessibility to financial products for underserved communities.

📚 Effective education initiatives can demystify financial products, fostering a better understanding and increasing participation among low-income individuals.

🏘️ Community-based models provide a sense of ownership and trust, facilitating the adoption of financial products by low-income groups.

⚖️ Regulators must carefully balance consumer protection with the flexibility needed for innovation to ensure the growth of inclusive financial services.

This session summary was AI-generated using NoteGPT.

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Insurance has been recognised as a tool to build household financial resilience. According to the FinScope 2019, 11% of the adult population have access to formal insurance in Mozambique which is hugely perceived as unaffordable by majority of adult.

Social protection is also needed to accompany efforts to help low-income groups be more financially resilient. In Mozambique the current pension system, is employer based and covers only a small fraction of the working population. Therefore, micro-pensions present opportunities for both public stakeholders and private sector players to broaden their market reach and covering those that are unserved with pensions and yet increase long-term financial resilience.

The Financial Sector Deepening Moçambique (FSDMoç) has established a partnership with the Insurance Supervision Institute of Mozambique (ISSM), to promote the development of a comprehensive and sustainable micro-pension ecosystem in Mozambique. The content of this partnership is in line with the understanding between the parties on the relevance and importance of micro-pensions for the low-income population and for the development of the economy in Mozambique. Mozambique seeks to join a number of countries around the world that are using micro-pension products to extend pension coverage to the informal sector.

The panel will delve on the ecosystem and the institutional factors that need to be explored to realize the potential of insurance and micro-pensions for low-income segments. The panel will also share best practices in micro-pension and pension funds’ investments.

Session Speakers

Lemmy Manje

CEO & Founder, FinProbity Solutions

Lemmy is an inclusive finance expert and has 25 years of professional experience in research, training and project management of financial inclusion projects with various international organisations. Lemmy provides technical assistance and management services to various international developmental organizations, insurance companies and other financial service providers; specialising in financial inclusion, inclusive insurance, financial education microfinance, informal finance, digital financial services, gendered financial inclusion, private sector development, business development services, value chain development, market development and small enterprise development. He has published numerous works on microfinance, microinsurance and small enterprise development. He is an alumna of the Harvard Kennedy School program, Rethinking Financial Inclusion: Innovation for Policy and Practice. His professional experience for long and short-term assignments has mainly been in North, South, Central and East Africa as well as Asia and Europe. He has a Master’s Degree (MA) in International Development from University of Manchester, United Kingdom and Bachelor’s degree (BA) in Economics and Demography from the University of Zambia.

Mdziye Chalamba

CFO, Sanlam Mozambique

Mdziye Chalamba is a Fellow Member of Association of Chartered Certified Accountants. He is a Chartered Accountant registered with the Institute of Chartered Accountants in Malawi. He holds a Bachelor of Business Administration majoring in accounting from the University of Eastern Africa Baraton and an MBA from the University of Derby. Mdziye has over 24 years of experience in Insurance, Pension Management and investment Management. Mdziye is currently working for Sanlam Mozambique as its Chief Financial Officer.

Benedito Murambire Jr

Investment Manager, FSD Mozambique

Benedito has over 30 years of experience in consulting and teaching in the areas of Financial Development and Financial Inclusion, Climate Finance, Microfinance, Inclusive Insurance, Construction Management and Economics, Affordable Housing Finance, SME Development and Finance, Training and Capacity Building. He led innovative initiatives in the financial sector ecosystem, such as the Micro Pensions Feasibility Study and Product Design in Mozambique, the Roadmap for Green Finance in Mozambique; the Roadmap for Microinsurance in Mozambique, the partnership with M-Pesa and others. He has been leading the work related to climate finance, capital markets and inclusive insurance. Recently lead research on Mechanisms and Solutions to Address Poor Households’ Climate Challenges with focus on women. He holds a PhD in Management with specialization in Strategy and Entrepreneurship and MBA from ISCTE-IUL Business School of Portugal, and a Pos-Graduation in Developing Social Housing Projects from the Institute for Housing Studies of Erasmus University in Netherlands. He holds also Certificates in Strategic Leadership for Inclusive Finance (Harvard Business School), Climate Change: Financial Risks and Opportunities (Imperial College Business School-UK) and Unlocking Investment & Finance in Emerging Markets & Developing Economies (World Bank), among others.

Bopelokgale Soko

Director General, Financial Intelligence Agency of Botswana

Ms. Bopelokgale Soko is the Director General of the Financial Intelligence Agency of Botswana, where she oversees the process of safe guiding the financial system from illicit use and combating money laundering and related financial crimes. With over 25 years of experience in financial sector regulation, supervision and policy development, Ms. Soko has been instrumental in shaping financial sector regulation and policy in Botswana and in the region. She has worked as a regulator and supervisor of commercial banks, pension funds and securities institutions, including the asset management industry. During the past decade, her work has focused on developing cost-effective and inclusive pension systems and appropriate policy and regulations. In that capacity, her primary clients have been national governments in the region, particularly those that have identified the need to build inclusive pension systems. Ms Soko holds a Bachelor of Commerce, from the University of Botswana, a Bachelor of Business Management and Administration and Master of Business Management and Administration (Finance), from the University of Stellenbosch, Cape Town, South Africa.

Leonilde Maria Mutumane Munguambe

Head of Life and Pension Department, ISSM

Has a degree in Accounting and Auditing and other qualifications in the area of insurance and pension funds. She joined the Insurance Supervision Institute of Mozambique (extinct General Insurance Inspectorate) in 2007 and currently serves as Head of the Insurance Department and Life Branch Operations in the Supervision Department. Among various responsibilities in his current role, she participates in the Coordination of the prudential analysis of life insurance companies and supplementary pension fund management entities. Also, participates in the international forums of insurance and pension fund supervisors, representing the ISSM; She is currently a member of the working group to Combat and Prevent Money Laundering and Financing of Terrorism in the Country.

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