Microfinance Products for Weather Risk Management in Developing Countries

To this date, efforts to introduce index-based weather insurance products have met with limited success, requiring in general heavy subsidies and running into difficulties in achieving market-based sustainability. At the same time, considerable progress has been made in adapting microfinance savings and credit facilities to the needs of the poor, but generally not for the purpose of helping them deal with uninsured risks.

With these issues in mind, Ferdi organized in June 2013 a workshop coordinated by Alain de Janvry and Elisabeth Sadoulet, Senior fellows at Ferdi, Professors at the University of California at Berkeley, and Principal Investigators for the Feed the Future BASIS AMA Innovation Lab, gathering many of the best international experts on these issues. The aim of the workshop was to review progress in the take-up of index-based weather insurance, and to explore the potential of financial instruments such as micro-savings and microcredit as complements to insurance in helping cope with weather shocks.

On this basis and to continue their long-standing collaboration, Ferdi and the French Agency for Development seek to open a dialogue with development practitioners and private banks and insurance companies in order to confront research results with these actors’ experience. They aim at stimulating interactions and favoring the exchange of experiences between researchers and practitioners. BASIS Director Michael Carter presented twice at this event and co-authored the resulting working paper.

Selected Presentations:

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