About Al-Amal Microfinance Bank:
Al-Amal reaches out to low-income micro-entrepreneurs and small business owners in Yemen with a suite of credit, savings, and insurance products tailored for Muslim borrowers. Before lending through Al-Amal, please consider the following:
1) Due to ongoing security concerns, full due-diligence of Al-Amal was conducted remotely rather than on-site. This makes Al-Amal atypical among Kiva's Field Partners, as Kiva staff have not conducted an on-site assessment. Al-Amal's assessment included in-person meetings with the top management in other, more secure locations in the Middle East.
2) Because Yemen is a new and unstable environment, there is a possibility that future loan repayments could be held indefinitely in the country for regulatory reasons, even if individual borrowers pay back their loans. As a lender to borrowers in Yemen, you accept this additional risk.
Additionally, all of Al-Amal's products are Sharia compliant and customized for its Muslim clients. Most of the loans are structured as Murabaha interest free loans. Al-Amal purchases goods for its borrowers and charges them a markup or fee. Al-Amal is also experimenting with Ijarah loans (an Islamic leasing product). For more information on Islamic microfinance, please click here.
With the civil war ongoing in Yemen, please be aware that lending to Al-Amal loan carries an elevated risk. Al-Amal has seen the delinquency levels in their portfolio rise as violence continues and economic challenges grow. We've also defaulted loans to Kiva borrowers who have been impacted by the war and unable to repay. Despite this reality, we continue to support Al-Amal because we believe strongly in the impact lenders' funds are having. Al-Amal is focusing on posting loans to Kiva to help small businesses recover or to help families cover essential expenses during the war. These loans have had a low delinquency rate since the start of 2017, but lenders should still be aware of the inherent risk in lending in Yemen at this time.
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