Top 3 benefits to outsourcing your accounting and bookkeeping
15 Oct

Top 3 benefits to outsourcing your accounting and bookkeeping

Top 3 benefits we want to share, which our clients have experienced after they decided to outsource their bookkeeping and accounting; especially during COVID-19 where a remote workforce has become the norm.

Keeping your company’s finances in-check is vital. Whether you are starting a business or already established, bookkeeping and reporting must be managed properly to provide accurate and real-time assessment of the company’s financial performance and position.

Traditionally, bookkeeping and accounting functions have been completed internally, but nowadays in a dynamic market there is a challenge hiring and retaining qualified finance professionals at an affordable rate. Thus, an increasing number of businesses are outsourcing their bookkeeping and accounting functions to a company with the right knowledge and expertise which can do the job better with time and cost saving methods. It also allows business owners and managers to shift their time and budget to improve their core business activities.

Therefore, here is the list of top 3 benefits we want to share, which our clients have benefited after they decided to outsource this function.

1. Cost Efficiency

Contrary to common perception that outsourcing can be additional or an unnecessary cost, outsourcing provides cost efficiency and reduces expense on hiring and payroll. Additionally, the process of hiring a full-time employee will attract additional costs, not just their salary but other expenses such as:

  • Recruiting
  • Training
  • Facility costs
  • Insurance
  • Benefits
  • Taxes

Savings associated with outsourcing are significant. Outsourcing Companies often offer their services at the lower cost rate (typically due to economies of scale), with better quality and service with no drop in productivity that come along with hiring full-time employees. Outsourcing will give your business more than you’d get with a traditional in-house bookkeeper including advice on tax and compliance.

2. Saves Time

Automation and streamlining your business should become integral as your business grows. However, without proper support you may find yourself spending more time managing people and processes for bookkeeping activities, leaving very little time to scale your business.

With an outsourced bookkeeper you can buy your precious time back to focus your time and energy on creating business strategies and development; investing in operations and training on employees that support your core business; and improving customer experience and building better relationships with your customers.

3. Improve Morale

When you hire an in-house bookkeeper, there is a possibility of certain margin of human error while waiting for them to understand the business and historic transactions. Before the numbers can be reliable, in-house finance staff need an adjustment period. Bookkeeping service providers help alleviate that challenge by promising maximum efficiency from day one.

By taking advantage of services provided by your outsourcing partners, you’ll have an expert that will save you time and reduce risks. Our bookkeepers utilize an automated system that seamlessly tracks your finances and provides real-time reporting, with a dedicated team of experts to resolve any issues immediately. Finally, as an independent firm, outsourcing will reduce the probability of internal fraud.

When You Should Consider Outsourcing Your Accounting And Bookkeeping

From our experience working with different local and international companies in Myanmar, outsourcing bookkeeping and accounting tends to work the best when:

  • A company of any size cannot find full-time employees with suitable qualifications at the affordable rate.
  • A small business which does not require a full-time bookkeeper but needs a qualified professional.
  • A growing company is looking to scale their accounting and bookkeeping functions.
  • A company that requires temporary services (e.g., extra help with year-end reports or if a full-time employee is going on holiday, maternity leave, etc).
  • A foreign company looking to do expend into Myanmar and requires a reliable outsourcing solution provider for their business.

FocusCore Corporate Services Myanmar is the leader in providing outsourced bookkeeping and accounting services to our clients in Myanmar and across the region. Our accounting professionals are highly qualified in the automation tools such as Xero and Quickbooks with an expert knowledge of the market, Myanmar tax administration law, and accounting standards.

Success during COVID-19: Myanmar SME receives Government COVID-19 Fund at 1% interest with the assistance from FocusCore Corporate Services.
25 Apr

Success during COVID-19: Myanmar SME receives Government COVID-19 Fund at 1% interest with the assistance from FocusCore Corporate Services.

As the financial market in Myanmar tries to reform from a collateral-based loan to credit-based system, having a GAAP accounting system to monitor the company’s financial position and performance becomes vital for any business at all stages of development.  Not only does it help business owners make informed decisions, it also helps businesses build credibility and communicate effectively with shareholders, investors, and regulators.

SMEs especially should keep their book keeping and financial statements up to date with accurate data and proper accounting standards from inception. This is especially relevant in times like this.

The Myanmar government announced last month, March 2020 an initial stimulus package of approximately 70 million USD to alleviate the impact of COVID-19 on local businesses and the economy at large. On 29 March 2020, one of FocusCore’s clients tasked our team to provide a turnkey service for COVID-19 Fund application. The loan application was submitted on 1 April 2020 and was approved by Myanmar Government on 8 April 2020. Our client was awarded with a 12 month loan at 1% per annum.

“We took the decision to outsource our accounting and finance department to FocusCore since we incorporated in 2015, which means our accounts are kept to a high standard. With their professional guidance, we always file our taxes on-time with the respective tax office in Yangon.  This certainly helped with the loan approval process.” said the SME owner after receiving the approval notice from DICA.

When businesses follow correct accounting standards and practices, applying for stimulus packages from their respective Government in a time of crisis becomes much easier. Businesses that interpret their results using informal accounting practices and failing to file taxes on time or not filing at all will be at a disadvantage in the long term.  

The Government also announced easing deadlines for tax payments for Myanmar-owned businesses that have been hit by the global pandemic. Qualifying businesses now have until the end of September to make their quarterly corporate income tax and monthly commercial tax payments.

Corporate Income Tax can now be made at the end of the current fiscal period ending 30 September. 

The deadline for monthly commercial tax payment has also been extended to 30 September. 

Businesses will be exempt from paying 2 percent advance income tax on exports until the end of the current fiscal period ending 30 September.

Since 2014, FocusCore has been advising companies in Myanmar for compliance, accounting and legal services. We strive to take the corporate administration load off operational staff, so they can do what they do best and focus on their core business. Contact us today to discuss how you can streamline your business performance and build a better business for tomorrow.

Complex Challenges or Opportunity for Change? The impact of COVID-19 and guidance for your company in Myanmar
18 Apr

Complex Challenges or Opportunity for Change? The impact of COVID-19 and guidance for your company in Myanmar

As Myanmar catches up with the rest of the world with the spread of COVID-19, it becomes apparent that the effects of the ‘Great Lockdown’ will soon be felt across the nation. Unlike many crises before, this once-in-a-century pandemic tests the humanity in many ways that have never been experienced. In addition to the devastating loss of lives being the worst consequence of this catastrophe, the indirect cost to society is still unaccounted for. Nonetheless, in these unsettling times individuals and businesses are presented with complex challenges, as well as an opportunity for change.

After being in Myanmar for 6 years providing corporate advisory, outsourcing, and payroll services with nearly two hundred clients across different industries ranging from international MNCs to local SMEs, we have put together a framework based on current market situation and industry responses to the outbreak in Myanmar. Now more than ever, leading through crisis and managing change become crucial to help us prepare for what may be the new normal.  

In all stages, human capital is crucial to propel out of this crisis. It is best to communicate with the employees to discuss solutions on how they can help the business in short-medium term. But, if you must resort to redundancies, please let us know and we can provide you with consultative advice around the local employment law. 

FocusCore can also discuss with you how to reduce fixed costs through outsourcing finance and human resource departments.  With outsourcing, it will allow you to increase your margins and reduce the fixed expenses.

Since 2014, FocusCore has been working closely with local and international companies to bridge a gap with relevant government ministries and to facilitate the process of setting up companies in Myanmar. Please contact FocusCore if you have any questions or require further assistance. We would be happy to setup a video call with you to discuss your business needs in more detail.

Myanmar MIC approval for Lippotex: Penang based manufacturer focused on textile related products and work wear apparel find synergy with FocusCore Myanmar.
17 Mar

Myanmar MIC approval for Lippotex: Penang based manufacturer focused on textile related products and work wear apparel find synergy with FocusCore Myanmar.

Founded in 1997, Lippotex Industries produced sportswear and knitted garments for export markets. Adapting the changes of market and world economy, they then expanded their product range to woven fabric clothing such as school uniforms and work wear for both local and export markets. In 2003, Lippotex established a textile weaving division, producing a wide range of woven fabric for work wear, office furniture and industrial use. Then June, 2007, moved into their current factory located in Alma Penang, Malaysia.

June 2019 Lippotex engaged FocusCore Myanmar to setup their first overseas subsidiary in Myanmar: Worker Apparel Co., Ltd.

“ln 2019, we planned to open a production plant in Myanmar. Like many foreign investors, we were keen to understand more about how to invest in Myanmar. FocusCore has delivered us an excellent, fast-response, and professional service towards our company incorporation, successful MIC application approval, and any questions raised by us. We are grateful and really appreciate FocusCore, Thank you.”

Tan Song Shui, Managing Director Lippotex Malaysia & Myanmar.

FocusCore Myanmar Co., Ltd. opened in early 2014.  We have helped many foreign companies with their MIC application approval and witnessed ongoing growth not only in client numbers but also rapid changes for the population. Growth of job vacancies, and overall prosperity and people buying power. If you are considering investing in Myanmar contact us today. This is once in a lifetime opportunity to join the up-swing of a frontier economy.

AMCHAM appoints FocusCore Myanmar as preferred vendor for bookkeeping, corporate secretarial and compliance matters.
26 Feb

AMCHAM appoints FocusCore Myanmar as preferred vendor for bookkeeping, corporate secretarial and compliance matters.

The mission of AMCHAM Myanmar is to promote and connect American business in Myanmar by encouraging local partnerships and upholding the highest business standards.

The President, CEO and Treasurer of the American Chamber of Commerce Myanmar (AMCHAM) all lauded FocusCore for its knowledge, professional support and high-touch client service.

“Rarely do we find a professional services firm with such a thorough understanding of Myanmar’s ever-changing legislative landscape,” said U Khin Maung Win, President of AMCHAM.

“FocusCore assisted us in closing gaps in financial reporting that proved critical to our operational procedures.  They have demonstrated an up-to-date understanding of the Tax Administration Law (TAL), Myanmar Companies Law (MCL) and prevailing Myanmar practices that give us the utmost confidence in renewing our partnership. I have heard firsthand from our treasurer, Andrew Lee, of our organization’s immense satisfaction with FocusCore.”

FocusCore are totally committed to helping companies start and operate in Myanmar. From Company Incorporation to staffing to bookkeeping and compliance and much more – with also fast track solutions so your company can start trading very quickly.  Call us today.

Myanmar – Foreign Banks now permitted to provide retail services across Myanmar
27 May

Myanmar – Foreign Banks now permitted to provide retail services across Myanmar

Foreign Banks operating in Myanmar can now open branches across all of Myanmar to provide banking services to retail customers. This has been awaited eagerly and provides another boost to the economy. Any subsidiaries of foreign banks are also included. The liquidity and large resources of these banks will be of huge value to businesses in Myanmar. This announcement was made by The Central Bank of Myanmar, (CBM).

A distinction was made to highlight the detail that subsidiaries can be a local bank. Their company incorporation structure being such that they are operating as an individual business. Whereas local branches of foreign banks are part of the head office. In future, any existing or new branches can register to operate as subsidiaries.

It is interesting to note that within the CBM, the Foreign Bank Selection Committee, which oversees the selection process of Foreign Banks, is now inviting “eligible consulting firms having an office in Myanmar to submit the Proposals for rendering consulting services in the selection of foreign banks”.

FocusCore opened in Myanmar in 2014. We, like many others, saw the waves of change arriving in Myanmar. These have been ongoing, introduced by a government with the express objective of opening Myanmar to the world. We have services to help companies establish company incorporation here, also providing these new companies with a fast track route to operating in Myanmar. For these and established organisations, our services also include bookkeeping, office and personnel search, and corporate legal services.

If you have been following our blogs you will have seen our many texts on the changes arriving in Myanmar. We are often one of the first sources to bring news. For up-to-date guidance on procedures here, and with always a finger on the pulse of information, contact us – we can provide valuable information, and rapid and durable solutions.

Why insurance is a further catalyst for growth in Myanmar?
08 May

Why insurance is a further catalyst for growth in Myanmar?

Insurance is an important global service – vital to commerce and private individuals.

1.) Why is insurance important to an emerging market?
2.) How does insurance underpin market-entry and business operational risk?
3.) Why Myanmar?
4.) What does it mean for Myanmar?

1.) Why is insurance important to an emerging market?

When an economy is growing quickly, as with Myanmar, insurance services play an important role in managing risk. For companies, their shareholders will demand insurance to protect their investments. Import and export activity requires insurance. Individuals, benefiting from a booming economy, with increased spending power, should be able to obtain insurance for their homes, family, life and health. Insurance is a catalyst allowing, and protecting, further growth in the economy.

By the structure of syndication an insurance provider can spread the risk of their portfolio with syndicates and insurance companies. This level of security provides confidence that is even more important in emerging markets. The insurance structure is often a group of insurance companies who work with contracts within the group. This allows even high value items to be insured with confidence. It is important to understand the strength that this structure provides.

One of the best known is Lloyd’s of London. In fact Lloyd’s is not an insurance company but a “marketplace”, which started in 1686. Today these insurers and reinsurers sign Terms of Business Agreements (TOBAs) linking their companies. This assures the insurance user that the risk is covered. The Lloyd’s market motto is Fidentia, Latin for confidence. Authorised financial backers and syndicates provide a collective resource to cover insurance claims.

“Improving access to insurance is particularly valuable for people with low incomes, who often struggle to manage unforeseen financial shocks.” (Sigma Insurance report, part of Swiss Re Group). The report emphasises, “these people are particularly vulnerable to shocks such as illness, incapacity to work, and the effects of natural catastrophes and extreme climate events, such as droughts. For insurers, opening up a new risk pool of several million customers on the cusp of transformative growth is an attractive proposition to embrace inclusive insurance of emerging consumers. It also helps close the protection gap for a large segment of the world’s population”. There are also patterns of microinsurance emerging in many countries, specifically designed to help low income individuals and families.

Another company with a focus on emerging markets and market entry is Willis Towers Watson who conclude, “Ultimately the goal is to secure a growth path and enhanced profitability which is sustainable”.
Unlike day to day decisions for purchases, such as your weekly shopping for food or larger items, insurance needs care. You are hoping it will never be needed but you have to trust the insurance provider will cover you in case of loss. Insurance is like the oil in the engine of commerce that keeps it running. If a company or individual needs to borrow funds, the lenders will demand insurance. Insurance can calm transactions by removing risk exposure that un-protected could block a deal. Insurance allows both companies and individuals to benefit from a more stable route forward. This applies to both huge conglomerates and small companies. Insurance is the logical, sensible service to adopt.

Over the years there have been cases worldwide of catastrophes. In one incident a factory caught fire and exploded. In another, chemical leakage has contaminated water courses. In one case the company was under-insured. The damage was so great to the region, local government and citizens took the company to court and won. The court awarded damages far in excess of the insurance value the company had chosen, indeed by a factor of 100, leading to the collapse of the company, with disposal of remaining assets. Taking insurance makes sense, but so does the careful and appropriate selection of cover.

It is not in the scope of the document, but it is interesting to note the growth internationally in a pattern to conform to international solvency standards. These are designed to protect consumers, retain financial stability and build trust in insurance companies. There are also deposit insurance systems (DIS) to create confidence for depositors.

In the words of Sigma (part of Swiss Re Group), “Emerging Markets will Drive Global Insurance Growth over Next Decade. Our forecasts show that emerging Asia will lead the charge for premium growth, expanding by three times the world average over the next two years.”

2.) How does insurance underpin market-entry and business operational risk?

There are many types of insurance to cover a range of risks across a wide range of industry and businesses. Policies will state what is covered and what is not included. It all comes down to managing risk. There is:-

Operational risk – the risk of a change in asset value following losses.

Business risk – the risk that results from wrong decisions e.g. backing new products, strategies or services.

Business success is not 100 percent certain. Questions arise, such as, is our strategy correct? Entering a new region and market adds to the risk. Insuring your developments adds strength and confidence to your entire company operation, especially in the new region, assuring both customers and investors. Insurance helps companies manage their operational risks. A crisis without insurance also leads to a reputational risk for the company. Also, if you are entering a new region there are compliance risks if you do not fully understand comply with national laws and guidelines

3.) Why Myanmar?

All regions, sectors, industries, commerce, families, and individuals benefit from insurance. The World Health Organisation estimates that 100 million people a year fall into poverty due to unexpected medical costs.

The value of insurance is even greater today due to the wider range of insurance cover that is now available. In India there is even a test phase for rainfall insurance that has been provided for 600 farmers.

Myanmar has a remarkably low take up of Insurance. Most citizens in Myanmar do not use insurance services. There are approximately 55 million citizens in Myanmar. Until 2013, Myanma Insurance was the sole insurance service in Myanmar. Myanma is a state controlled service. The range of insurance had been relatively limited by global standards. The opportunities in Myanmar for insurance providers are enormous.

Now, insurance and insurance broking business is conducted through either a company incorporated in Myanmar or a company established outside Myanmar with an established place of business in Myanmar.

The huge opportunity in Myanmar is recognised by insurance companies – alongside the huge risks for companies and individuals if they continue in old patterns and do not use insurance services.

Changes in regulations in Myanmar are very significant for the insurance sector. It is widely recognised that the Insurance Sector in Myanmar needed to change, to respond to huge increases in trading and overall economic activity in Myanmar. Last year official statements stated that work was underway “to solve the problems of the insurer and the insurance companies in line with law and rules, to establish the Open Insurance Market Operation, to establish the Pure (Perfect) Competition Market, to be non-monopolistic stage, enable to operate the co-insurance by the local/foreign companies, to have heterogeneous products, to create free entry to and exit from the insurance industry and to collect the transparent and free information in Insurance Sector of Myanmar”.

Asia and the Far East has the largest potential for growth in insurance policies. Providers realise that they must grab market share, be the first entrant wherever possible. It is easier to grow client volumes in emerging markets.

Many reports echo patterns around the world where Insurance companies are strong investors in national bond markets, so this is another boost for Myanmar. Reports indicate that at present in Myanmar the insurance sector accounts for 0.07pc of GDP.

4.) What does it mean for Myanmar?

Reduced risk, more attractive environment for investors, further spurs for growth and prosperity. The global insurance industry, after years of development, is well practiced in spreading their insurance risks, so they can be sure they can reimburse the claimant and or company if a claim is submitted. For Myanmar, the exponential rise in exports and imports, the rapid rise of construction of residential and commercial sites, and growth year on year of sales and the range of products available, all means insurance is more important. Asset values rise and need to be insured.

Furthermore, changing and unpredictable weather patterns add importance to insurance, so this is a sensible practice for business and individuals – insure your trades, possessions, and also obtain the benefits of health insurance. Companies who do not offer staff benefits such as health insurance, may find that staff leave for a competitor, who does provide insurance. It is still a candidates’ market in Myanmar, with more vacancies than candidates for many roles.

The range of risks that can be covered continues to grow. In general terms, forms of insurance include:-

  • General Insurance: This is any insurance policy but does not include life insurance comes under general insurance.
  • Fire Insurance.
  • Marine Insurance: This includes cargo insurance, hull insurance and freight insurance.
  • Miscellaneous Insurance: home insurance, credit insurance, vehicle insurance. There are many other types of general insurance.

It is a sad fact that emerging countries tend to be affected by insurance gaps. There are increasing reports of natural catastrophes. This hits emerging economies and citizens. With insurance, you have the reassuring fact that help is at hand.

The MOPF’s announcement No 1/2019 officially permits companies wishing “to operate the business of insurance, underwriting agency or insurance broking with foreign investment” to open for business in the country. FocusCore opened in Myanmar to help companies become established here and our services have grown to provide a full range of corporate services. We are delighted to see this development that will be of value to existing and new companies in Myanmar. Our extensive network of contacts covers Government and Commercial Sectors, allowing us to offer you efficient and informed guidance to facilitate your profitable company operations in Myanmar. Come to Myanmar now and see how this growing market can be a positive expansive step for your company and investment.

International Chambers of Commerce highlight the potential in Myanmar
12 Feb

International Chambers of Commerce highlight the potential in Myanmar

International Chambers of Commerce in Myanmar from Australia, Britain, Europe (EU), France, Germany, Italy, and The United States have come together as signatories to publish their encouragement for more foreign investment in Myanmar. Their compatriots, and indeed investors from many more countries are investing in Myanmar as the economy continues to grow.

The text explains, “Having been in isolation for so long, Myanmar now requires the broad regeneration of its economy to meet the demands of modern-day trade. As a result, there exists a significant range of private sector investment opportunities across every sector of the economy. Existing investments by our members contribute significanty to transformative social and economic development from within Myanmar,” [with] established international standards of corporate governance and sustainable responsibility.”

Last year The Government of Myanmar published the Myanmar Sustainable Development Plan (MSDP) for 2018 – 2030 providing a long term vision to attract US$200 billion. The plan also highlights the fact that Myanmar is the largest country in mainland Southeast Asia with a population of 53 million and located strategically between China and India. Myanmar plays a significant role, geographically, economically and politically, in the most rapidly advancing region in the world. A country that has been isolated for much of the past six decades.

In our January blog we reported on the highly successful Invest in Myanmar Summit. The message is clearly spreading far and wide and is being heard by companies.

Companies investing in Myanmar are listed from 49 countries by the Directorate of Investment and Company Administration (DICA). The top 16 by value are shown below with China, Singapore, Thailand and Hong Kong companies heading the list with the UK listed as N°5.

Foreign Investment of Permitted Enterprises as at 31 December 2018 (US $million).

1 China 20353.528
2 Singapore 20337.703
3 Thailand 11124.715
4 Hong Kong 7900.472
5 U.K 4517.663
6 Republic of Korea 3892.136
7 Vietnam 2161.103
8 Malaysia 1963.124
9 The Netherlands 1531.671
10 Japan 1183.921
11 India 763.567
12 France 549.740
13 U.S.A 432.796
14 Indonesia 274.530
15 Canada 203.594
16 Australia 145.799

Total 80126.675 (US $million)

FocusCore also saw the potential in Myanmar and we opened our offices here in 2014. The range of overseas companies we are helping grows not only in quantity but also across the growing range of countries they represent. We have said before that Myanmar is seen as the last area to emerge on the global stage, offering substantial growth potential across all sectors. Yes, companies need to follow Myanmar guidelines and we in FocusCore are here, specifically, to help companies start trading in Myanmar – quickly. We also provide up to date advice on the various investment incentives that may apply to each sector and region. Call us today to gain valuable information and grow your operations in the region.

Central Bank of Myanmar (CBM) allows local private banks to receive up to 35% equity from foreign banks.
06 Feb

Central Bank of Myanmar (CBM) allows local private banks to receive up to 35% equity from foreign banks.

In our blog of last November we outlined the news of a new Directive, issued by the Central Bank of Myanmar (CBM), authorising wholesale banking to be supplied by foreign banks to foreign corporates, foreign financial institutions, and local companies partnered with local financial institutions. A very significant step.

Then in December, news of a service to provide background checks for lenders that was opening in Myanmar – Myanmar Credit Bureau Limited, MCBL. Ready for new loan services to expand in Myanmar.

Now, on January 29 Directive No 1/2019 confirms the planned change for local banks, allowing up to 35 percent investment from an overseas institution. The local banks receiving the funding will not need to change their registered status as a Myanmar company, providing that the 35 percent rule is not exceeded.

This is all part of the changes introduced via The Myanmar Companies Law. This is very positive news for local banks, who seeking more capital, will now be able to boost further the growing economy.

Nevertheless each local bank institution will need to obtain authorisation prior to the investment. FocusCore, established in Myanmar since 2014, is here to help organisations obtain approvals, permits and visas to operate in Myanmar and overseas firms who wish to invest in local companies. Clearly, our detailed knowledge of the constant wave of liberalising changes in company incorporation and funding regulations is vital. We can provide you with information and resources so you can choose and place your investment and start operating rapidly in Myanmar.

Foreign Insurance companies see huge potential as Myanmar allows them to operate.
09 Jan

Foreign Insurance companies see huge potential as Myanmar allows them to operate.

September 2018 FocusCore Myanmar published a blog with the headline “MYANMAR opens its doors to Overseas Insurance companies – contact FocusCore today”.

Now, following more work on processes to liberalise the insurance sector in Myanmar, events have led to the official Announcement No. 1/2019, 2 January 2019, by the Ministry of Planning and Finance, MOPF, entitled “Insurance Market Liberalization for Foreign Entities in Myanmar”. This is part of the Myanmar Insurance Sector Liberalization Roadmap. This announcement grants permission to companies who wish “to operate the business of insurance, underwriting agency or insurance broking with foreign investment”.

Change had become visible in 2013, when eleven licences were granted to local companies. The aim of the Government being to develop the insurance sector. Prior to 2013, the only source of insurance was via Myanma Insurance. Myanma Insurance is a state-owned insurance company, founded in 1952, a monopoly. It started as a life insurer but later broadened its scope to underwrite both life and non-life insurance.

Now, both foreign and local insurance companies are invited to submit their Expression of Interest (Eol) and/or the Request for Proposal (RfP), in order to transact insurance business in Myanmar. The announcement further states that, The Financial Regulatory Department (FRD) “will facilitate the clarifications and discussions on the Eol and/or the RfP”.

Local composite insurers are mandated by the MOPF to operate as separate life insurance and non-life insurance entities paving the way for foreign entities to associate or partner with local insurers. The licensing guidelines provide various options.

Life Insurance Companies
Option 1: Allowing not more than 3 licenses for foreign life insurers as 100% wholly owned subsidiaries;
Option 2: Allowing foreign life insurers with a life/composite representative office in Myanmar to form joint venture with local life insurers.

Non-life Insurance Companies

Allowing foreign non-life insurers with non-life/composite representative offices in Myanmar to form joint ventures with local non-life insurers. Non-life insurance has very low penetration, only 0.05% of GDP. Over 80% of the market is in fire/property insurance. These initiatives are attracting more investment from overseas. Once a licence is granted, the agreement states that the insurance company must buy Government Bonds. So further overseas capital is entering Myanmar.

FocusCore made its first investment in Myanmar in Spring 2014. Since then we have expanded our range of corporate services, helping companies across many sectors to start and operate successfully in Myanmar. Now, seeing the low penetration of insurance to date and the huge opportunity, many more will take note. This will add further benefits for risk management and another boost for the prosperity of the economy.