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Daman is a credit guarantee fund proposed by SIDI and created jointly with ACAD Finance and ASALA to cover the risk inherent in the political situation in the Palestinian territories due to military occupation. The aim is to enable the beneficiary microfinance institutions (ACAD F, ASALA and REEF) to develop their lending activities for disadvantaged populations, particularly in areas under military administration (Zone C) and in the Gaza zone. Daman is co-financed by the Luxembourg Ministry of Foreign Affairs through the NGO Paix Juste.
Palestine (territories under Israeli occupation since 1967) is a territory divided and fragmented by the presence and growth of illegal Israeli settlements (according to international law) where the Palestinian state controls only 18% of the surface area (as provided for in the Oslo agreements). The failure to resolve the Palestinian question is hampering the development and security of the region (due to the conflict between Israel and certain Arab countries) and making it a less than autonomous and non-viable entity (without international aid). The Palestinian state itself is divided between Gaza and the West Bank, with authoritarian political institutions fighting for Palestinian leadership over Israel.
The existence of a guarantee fund enables Micro Finance Institutions (MFIs) to continue to take risks and lend to clients, in the knowledge that in the event of political conflicts that regularly disrupt the lives of the Palestinian population: wars, daily military operations and frequent land confiscations that affect people’s ability to run small businesses and repay their obligations; the guarantee fund can be seized and reimburse the MFI. In addition, DAMAN, which brings together the three “social” MFIs in Palestine, promotes a common approach to social and environmental performance.
