On Thursday 21st November, APA Insurance of Kenya won the €100,000 European Microfinance Award 2019 on ‘Strengthening Resilience to Climate Change’ at the award ceremony at the European Investment Bank.
APA Insurance Ltd is a Kenyan insurance company that provides index-based agriculture insurance to cover yields and livestock, providing farmers with a safety net. Index-based insurance is an innovative approach to insurance whereby automatically triggered payments are linked to environmental and weather conditions such as the level of rainfall, yields or vegetation levels as measured by satellite) directly connected to the loss of agricultural output. In Kenya, where over 75% of farmers are smallholders, who are especially vulnerable to the economic impacts of climate change, APA Insurance Ltd currently covers more than 350,000 families whose livelihoods are largely based on agriculture.
The ceremony included speeches by Paulette Lenert, Luxembourg’s Minister for Development Cooperation and Humanitarian Affairs, Dr. Werner Hoyer, President of the European Investment Bank, and Sunita Narain, Director General of the Centre for Science and Environment. In recognition of this being the 10th edition of the European Microfinance Award, there was also a ‘where are they now?’ series of videos from several of the previous Award winners, with Crédit Rural de Guinée of Guinea, Kashf Foundation of Pakistan, Tosepantomin of Mexico, Buusaa Gonofaa of Ethiopia and Kompanion of Kyrgyzstan all sending in warm thanks to the Award organisers and short summaries of how winning the Award has helped expand their respective initiatives.
As always, there was also a video presentation from the previous year’s winner on how the organisation has benefited from the funds and exposure that the Award brings. Advans Côte D’Ivoire demonstrated how winning the 2018 Award on ‘Financial Inclusion through Technology’ has allowed increased training of accountants in cooperatives to become third party agents – a personal, safe and discreet service for cocoa farmers to use as a financial intermediary.
Paulette Lenert, Luxembourg’s Minister for Cooperation and Humanitarian Affairs, said that the Ministry’s Luxembourg Development Cooperation has been among the first movers in the finance ecosystem worldwide, and observed the importance of facilitating services that go beyond just credit to the poor. “The focus of a donor country should not just be on the credit, but on the innovation,” she said, including “business training, financial education and technical assistance”.
Minister Lenert, who also chaired the High Jury, added that the 2019 Award “illustrates that inclusive finance has an essential role to play in strengthening the resilience of vulnerable communities to the effects of climate change, which threatens the livelihoods of disadvantaged communities, especially those relying on agriculture, forestry or fisheries.”
Dr. Hoyer outlined the EIB’s commitment to climate finance, announcing the recent decision to increase the Bank’s share of climate activities from 28 to 50% by 2025, with the aim to mobilise 1 Trillion euros in climate projects via EIB activities in the coming decade. Dr. Hoyer praised the outstanding applications from the two other finalists, ASKI of the Philippines and Financiera Fondo de Desarrollo Local of Nicaragua, and said that climate change “is an existential threat for many nations and communities; how we combat and adapt to it will shape our future. The three finalists of the European Microfinance Award, and APA Insurance Ltd in particular, are delivering innovative solutions for the financial sector to support vulnerable communities in tackling the effects of climate change.”
The ceremony keynote address was given by Sunita Narain, Director General of the Centre for Science and Environment, a passionate call for urgent efforts to mitigate and adapt to the effects of climate change on the world’s most vulnerable, the “victims” who have not contributed to the problem, who are made “even more marginalised” and whose “pain makes the world more insecure”. Giving jarring examples of the effects in her native India, she described the effects of variable and extreme rain events: “flood at the time of drought, drought at the time of flood…all the development dividends are destroyed and need to be rebuilt because of a double whammy of mismanagement and climate change impacts…the monsoon is the true finance minister of India,’’ she said.
Following this moving keynote, Minister Lenert announced APA Insurance as the winner of the Award, which was accepted by Mr. Ashok Shah, who warmly congratulated the other two finalists, and expressed APA’s sincere gratitude for the recognition and opportunity that winning the Award will offer – helping APA increase the number of people it is able to serve.