Speaking at a roundtable organized by Sakchyam Access to Finance Programme in Kathmandu on Friday, they also demanded facilities like VAT waiver and other discounts so that insurance companies are encouraged to float micro-insurance products."The management cost to float micro-insurance products is very as premium levied on such products is very low. We should develop some innovative products to reduce our management cost or partner with cooperatives and other institutions on profit-sharing model," said Dip Prakash Panday, CEO of Shikhar Insurance Company Ltd, said. "VAT exemption, custom waiver on micro-insurance software, tax holiday on micro-insurance products, and free availability of weather data, which is necessary for micro-insurance products like agro-insurance, can also help reduce management cost."
Also speaking at the program, Bhoj Raj Sharma, an expert with Beema Samiti - the insurance sector regulator, said the need of micro-insurance products for poor people has grown further in Nepal as 80 percent people rely on agriculture which may observe risk due to climate change. "Realizing the need to introduce micro-insurance products, Beema Samiti has introduced needful directives for the insurance industry," he added.
Meanwhile, Sakchyam has called for applications from insurance companies to design, develop and rollout innovative micro-insurance products, for both life and non-life segments, to enrich the insurance services for underserved rural poor, women, youth and members of the disadvantaged groups.
"This call for proposal solicits creative applications that propose new micro-insurance products through innovative delivery channels," a press release issued by Sakchyam reads.
A2F TO PROVIDE TECHNICAL SUPPORT TO BFIS
Meanwhile, Access to Finance (A2F), a project jointly implemented by Nepal Rastra Bank (NRB) and the United Nations Capital Development Fund (UNCDF), along with 13 various banks and financial institutions (BFIs) jointly launched technical assistance partnership on Friday.
A press release issued on Friday said UNNATI-A2F will provide technical support to its partner institutions in some specific areas including assessment of Management Information System and upgrading of the system, training and capacity building for market research and product development for agriculture sector, and training and exposure visit on Agriculture Value Chain Financing, among other sectors.
Speaking at the ceremony, Nepal Rastra Bank's Deputy Governor Maha Prasad Adhikari said that access to finance is a means for successful poverty reduction strategy. "The use of innovations such as mobile banking and other commercially viable pro-poor products will be future options," he said.
Learning lessons from the present situation emanating from Tarai unrest and Indian blockade, he urged BFIs to take this as an opportunity and review their lending system that would help the country to become sustainable in generating products and services.
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