Savings and Insurance

Savings Products

In 2007 VFC will be launching new savings products called Social Investor Term Deposit and Passbook Savings Account. This will help to create a balance between the depositors and borrowers.

Deposits received from the public will be a source of capital that VFC can then utilize to reinvest into the expansion of further lending activities.

New product development will ensure that VFC continues to build the community’s confidence as a trusted banking system.

Micro Insurance

Existing insurance substitutes for the poor in Cambodia are weak. In the case of death in the family or other emergencies, the poor rely on the neighbors’ contributions, savings and asset liquidation. Often, the exorbitant interest rates charged by moneylenders place tremendous financial strain on the family of the deceased. Negative life cycle events tend to erode clients’ net wealth. Clients resort to existing coping mechanisms because they have to, not because they want to.

VisionFund has recognized the demand for insurance for the poor and in 2007 plans to develop a micro insurance product. This will be rolled out in two phases. In the first phase micro insurance will be a project managed by the existing team. This micro insurance will protect against loan default as a matter of death and help with funeral expenses. In phase two VisionFund will establish a separate company with a view of possibly extending to other insurance services.