West Bank/Gaza – Small and Microfinance Assistance for Recovery and Transition Program (SMART)

Increasing the Capacities of Microfinance Institutions

Begun in September 2006, the USAID-funded Small and Microfinance Assistance for Recovery and Transition (SMART) program is a two-year, $7.7 million program. It is designed to preserve the microfinance institutional infrastructure in the West Bank and Gaza and help microfinance intermediaries develop and adopt effective growth and risk mitigation strategies, thereby laying the foundation for sustainable growth. ACDI/VOCA, as the main subpartner under the award to AED, supports SMART with technical assistance in microfinance development targeted at building effective linkages between agricultural and community-based business cooperatives and providers of financial services.

At the beginning of the program, SMART focused on facilitating urgent business turnaround for microfinance providers in the face of economic emergency while at the same time helping to build a stronger, more commercially oriented microfinance industry. SMART recognizes that individual microfinance providers (MFPs) need customized support packages of loan capital, grants, and technical assistance to stop decapitalization, improve their capacity to manage risks, and develop innovative business strategies and products to cope and grow in the current challenging environment.

ACDI/VOCA under the SMART project provides the following:

• technical assistance to microfinance institutions (MFIs) to improve their risk management systems and processes and their capacity to develop products that are responsive to their clients while maintaining sound financial management to move toward sustainability even when affected by conflict
• direct assistance to MFIs that does not distort the market for these services
• assistance in assessing the potential for risk management products and the roles that these products can serve through microinsurance programs

Additionally, it has been determined that there is a need in the West Bank to design, develop and test new financial products and services adapted to the evolving economic environment that link low-income smallholder farmers and agricultural enterprises to appropriate types of financing. ACDI/VOCA is actively looking for ways to work with its Food Security Program in the West Bank to strengthen the agricultural value chain in the West Bank.

For more information contact Katherine Brogan at kbrogan@acdivoca.org.

Updated: 3/08

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