The Business Case for Adding Health Protection to Microfinance

This paper documents the impact that health protection products can have on the financial performance of MFIs. It is based on the experiences of Freedom from Hunger and its MFI partners in the Microfinance and Health Protection (MAHP) initiative.

In 2006, Freedom from Hunger along with five MFIs from India, the Philippines, Bolivia, Benin, and Burkina Faso set out to explore whether it was possible to design and offer health-related products and services that could have positive social impact for clients while also being cost-effective and even profitable for MFIs. Each MFI tested a package of health protection products.

Freedom from Hunger and participating MFIs found that health protection products do have the potential to positively impact not only clients but also the financial bottom line of the MFI itself. The paper demonstrates that:

• Integrated microfinance and health protection products can be inexpensive for MFIs to offer;
• Offering health protection products has the potential to enhance MFI competitive advantage;
• Value of health protection products to clients and their communities can create social value that contributes to the MFI's social mission.