Fighting poverty can by no means be viewed as a fundamental approach in the strategy of the Arab Gulf Program for Development (AGFUND), headed by His Royal Highness Prince Talal Bin Abdul Aziz. It can actually be considered as a fingerprint in AGFUND’s developmental activities. In its strategy and plans to alleviate poverty, AGFUND adopts the best practice of Microfinance, as this approach is characterized of being the most efficient in targeting the category of the qualified poor.
For that reason, with the beginning of the third millennium, AGFUND has steadily commenced in implementing the initiative of Prince Talal Bin Abdul Aziz to establish banks for the poor, through disseminating Microfinance culture as well as providing the technical support for Microfinance projects. The most significant role that AGFUND played was the setting up of the legal and legislative infrastructure of the countries that seek to establish banks for the poor. This is in addition to activating the role of the governments in providing an environment that best suits the Microfinance institutions and in the same manner offering non-financial services such as (technical support and linking the financing institutions together).
These continuous efforts resulted in opening the first bank for the poor in the Arab world; Al-Watani Microfinance Bank, in Jordan. The bank started its operations in 2006 and was also followed in 2007 by Al Amal Microfinance Bank in Yemen.
In addition, AGFUND proceeds forward towards achieving its goals that were set earlier, taking advantage of the remarkable success that has previously achieved in Jordan and Yemen, and from the environment which has become more favorable for Microfinance in the Region and the world. Early in 2008, AGFUND has re-phrased its approaches in Microfinance by depending on three main aspects/components:
- Continuing its expansion plan and establishing the banks for the poor under one brand name (Al-Ibdaa)
- Establishing AGFUND’s Technical Support unit to provide banks for the poor with the needed technical assistance, as well as sharing experiences between the existing banks and the banks for the poor that are yet in the pipeline. This consequently leads to the contribution in promoting Microfinance industry.
- The APEX FUND: the main objective of this Fund is to provide credit facilities for AGFUND’s currently operating banks, its pipeline banks as well as other Microfinance institutions. This can be achieved through providing various and competitive financing products that meet the requirements of the banks/ MFIs, and thus contribute in filling the gigantic gap between the supply and demand of these products.