NDB LAUNCHES INSURANCE AGENCY
National Development Bank (NDB) has on Tuesday this week launched a new subsidiary called the NDB Insurance Agency.
The Insurance Agency products will be offered through the bank’s partnership with Botswana Insurance Holdings Limited (BIHL), subsidiary companies being Botswana Life and Botswana Insurance Company (BIC).
According to NDB Chief Executive Officer, Lorato Morapedi, the move to form an Insurance Agency was influenced by the amount of investment within the different sectors of the economy by way of financial loans.
“We invest in risky spaces, from startup businesses where research has proved that 90 percent of these hardly survive the first three years and, in agriculture, where weather conditions of our beautiful country compound the already risky nature of the sector,” said Morapedi.
Despite this, Morapedi stated the development bank is committed to supporting food security as well as providing support to the Small, Medium and Micro Enterprises (SMMES), economic diversification and employment creation.
Giving a keynote address at the launch on behalf of Minister of Finance and Economic Development, the ministry’s Deputy Permanent Secretary responsible for Financial Policy, Boikanyo Mathipa, said NDB Insurance Agency will offer Bancassurance product solutions that will cushion customers against various risks.
“It is my hope that this new product will benefit both small and medium enterprises across various sectors and their employees, as well as the public at large, and in the process promoting financial inclusion,” said Mathipa.
In the short term, she noted the agency should boost the local banking and insurance sectors.
Mathipa noted that business ventures such as agriculture and start-ups often carry inherent risks.
“In the case of agriculture; droughts, diseases, effects of climate change and negative economic downturns, in many instances, could affect the customer’s ability to service their loan facilities,” said the Deputy PS.
Between 2008 and 2018, NDB is reported to have invested a total of P1.7 billion in different agricultural subsectors made up of: P889 million in arable farming, P730 million in livestock production, P51 million in horticulture and P10 million in poultry.
Mathipa said this level of investment requires risk mitigation instruments and it is expected that the partnership between NDB and insurance companies will see more agricultural insurance products offered.