The following will be discussed in this chapter: CEMEX Patrimonio hoy (equity today) program, ARGOZ’s lease-option contracts, alternative vs. bank financing, remittances, new entries,. | Summary of the Last Lecture THREE PRODUCTS: INSURANCE, HOUSING FINANCE, AND REMITTANCES THREE PRODUCTS: INSURANCE, HOUSING FINANCE, AND REMITTANCES CEMEX Patrimonio Hoy (Equity Today) Program CEMEX’s housing microfinance product uses similar principles. CEMEX is one of the largest cement companies in the world but was faced with increasing competition in its home country of Mexico. CEMEX Patrimonio Hoy (Equity Today) Program The century-old, global building-materials supplier wanted to increase sales of cement to poor and lower-income Mexicans who improve their houses incrementally over years. CEMEX Patrimonio Hoy (Equity Today) Program Admitting it knew little about the needs of this market, CEMEX researched home-building practices in local communities, especially the rotating savings and credit associations called tandas. CEMEX Patrimonio Hoy (Equity Today) Program The results were heartening: sales of cement increased, housing improvements increased, and brand recognition was . | Summary of the Last Lecture THREE PRODUCTS: INSURANCE, HOUSING FINANCE, AND REMITTANCES THREE PRODUCTS: INSURANCE, HOUSING FINANCE, AND REMITTANCES CEMEX Patrimonio Hoy (Equity Today) Program CEMEX’s housing microfinance product uses similar principles. CEMEX is one of the largest cement companies in the world but was faced with increasing competition in its home country of Mexico. CEMEX Patrimonio Hoy (Equity Today) Program The century-old, global building-materials supplier wanted to increase sales of cement to poor and lower-income Mexicans who improve their houses incrementally over years. CEMEX Patrimonio Hoy (Equity Today) Program Admitting it knew little about the needs of this market, CEMEX researched home-building practices in local communities, especially the rotating savings and credit associations called tandas. CEMEX Patrimonio Hoy (Equity Today) Program The results were heartening: sales of cement increased, housing improvements increased, and brand recognition was strengthened. While initially designed as a gesture of social responsibility, CEMEX gradually realized that helping the poor could be achieved while making a profit. CEMEX Patrimonio Hoy (Equity Today) Program This realization led to a greater rollout of Patrimonio Hoy, which has now helped 185,000 Mexican families build the equivalent of 95,000 ten-square-meter rooms. ARGOZ’s Lease-Option Contracts This example also highlights a nonbank source. In the absence of bank involvement, private land developers sometimes put their own financing packages together for low-income buyers. ARGOZ’s Lease-Option Contracts Developers like ARGOZ, El Salvador’s largest land developer, buy the land, put in roads and utility hookups, and build the homes. When target buyers can’t get loans, ARGOZ lends the money, too. ARGOZ’s Lease-Option Contracts ARGOZ offers 10-year lease-options contracts for land purchases at rates similar to commercial bank rates for housing. Buyers legally own the land only after the .
