> Posted by Elisabeth Rhyne, Managing Director, CFI

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There was a curious refrain at the joint Institute of International Finance (IIF) / G20 conference in Buenos Aires: “The global economy is in the best shape in years, but I’m worried.”

This meeting brings together some of the leading financial sector policymakers with counterparts among private banks and financial institutions to talk about the action agenda for this year’s G20. Maybe it’s asking too much for the macroeconomists who advise global banks and policy setters ever to be anything other than worried – they are paid to worry. But I think it’s more than that. The overwhelming message is we (the world) are at a good moment economically, but any number of events could knock us (the world) off our cloud. Among them:

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> Posted by Emma Morse, Project Specialist, CFI

“We think too small, like the frog at the bottom of the well. He thinks the sky is only as big as the top of the well. If he surfaced, he would have an entirely different view’”- Mao Tse-Tung

Too often, financial inclusion providers don’t think about risk until it is too late. The ability to identify, understand, and develop strategies to mitigate risk are key to ensuring the sustainable growth of the market.

Since 2008, the Center for Financial Inclusion has partnered with the Center for the Study of Financial Innovation (CSFI) and Citi Foundation to carry out Finance for All, a survey to identify and assess the risks associated with providing financial services to the financially excluded – people who lack or have limited access to banking, savings, or insurance products. Advances in technology have created new opportunities to reach the financially underserved and have brought new players into the market, but large scale change has also created new sources of risk, which are often poorly identified and understood. Finance for All, formerly known as Microfinance Banana Skins, is the first research effort of its kind to identify key sources of risk, and in doing so, provide perspective on the security and regulation of markets, their vulnerability to political manipulation, and the robustness of business models to meet the challenges posed by these risks.

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> Posted by Robin Brazier, Communications and Operations Associate, the Smart Campaign

March 15 is World Consumer Rights Day (WCRD), a day marked by the consumer movement each year to raise global awareness about consumer rights and needs. It’s an opportunity to demand that the rights of all consumers are respected and protected, and to protest against market abuses and social injustices which undermine those rights. The Smart Campaign marks this occasion by talking about the importance of transparency and grievance redressal as key tenets of client protection and building consumer trust.

WCRD’s theme this year is “Making Digital Marketplaces Fairer.” With the volume of online transactions increasing, consumers are exposed to new – sometimes not fully understood – risks. For this reason, WCRD 2018 is calling for access to fair and secure internet for all, action against scams and fraud, and better consumer protection online.

According to Consumers International, nearly half of consumers that have access to internet but do not shop online cite lack of trust as the reason. Similarly, almost 70 percent of online consumers worry their digital payments are unsafe. What contributes to this lack of trust? The causes vary, but they often hinge on two things: lack of transparency and insufficient grievance redressal mechanisms.

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A responsible exit lays the foundation for long-term impact, and requires considerations as early as due diligence 

> Posted by Hannah Dithrich, Research Associate, the Global Impact Investing Network (GIIN)

Impact investors are motivated by two primary objectives: to generate a financial return and to create positive social or environmental impact. But how do they balance these dual goals throughout the investment process, and specifically at exit? It’s no easy feat.

Investors must consider what happens to impact when they exit an investment. For example, if a company received critical capital and resources from an investor, will it still be equipped to succeed and continue its mission when that investor exits? What if an investor sells her shares to a more commercially-minded buyer who deprioritizes the company’s impactful or sustainable practices?

In financial inclusion investments, the possibility of mission drift after exit can have real implications for impact. For example, if a microfinance institution is acquired by a firm with little experience with underbanked customers, it could increase loan sizes beyond what clients are able to pay back, ultimately leading them into cycles of debt. Impact investors seek to mitigate such risks by exiting their investments responsibly.

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> Posted by Wajiha Ahmed, Deputy Director, Bankable Frontier Associates

How can we design financial products for women?

We hear this question from a lot of financial service providers. After researching the financial lives of low-income households through Financial Diaries studies in Kenya, Mexico, and India, we answered this question in A Buck Short, a paper published last year with support from the Omidyar Network.

Low-income men and women in the studies are typically on the same team; they have the same end goals and want what’s best for their families. However, each plays a different role in the household. Men play offense, looking for opportunities for higher income. Women play defense, juggling household expenses and financial products to keep cash flowing and family assets safe. Our Financial Diaries also found that women have a stop-start pattern to earnings, limited mobility and geography, and horizontal, instead of vertical, financial networks. These differences leave women with limited access to financial products, invisible credit histories, and few formal financial relationships. Our research, as well as this paper by Women’s World Banking, found that although their financial lives differ from men’s, women don’t necessarily want different financial products, but they do want to be served differently.

How do the findings from our research translate into insights providers can actually use?  Here are a few recommendations for providers – traditional or fintech, start-up or incumbent – that want to better serve women with tailored financial services.

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We hope reading this post is just one of many activities you undertake today that acknowledge and celebrate the achievements of women. This International Women’s Day, we turned to a few of the women of CFI to share their thoughts on the gender gap facing lower income women around the world and ways to shift the balance in their favor.

Deborah Drake

Deborah Drake says, “International Women’s Day gives us a chance to appreciate the hard work and sacrifice women make every day for their families. It also highlights the challenges involved in giving women the opportunity for economic empowerment and the ability to make choices, including financial decisions for themselves and their families.” (As Vice President of CFI’s Investing in Inclusive Finance Program, Deborah leads the Africa Board Fellowship Program and the Financial Inclusion Equity Council.)
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More investor types, more ways to invest, more emphasis on impact

> Posted by Danielle Piskadlo, Director, Investing in Inclusive Finance, CFI

The future of impact investing was the hottest topic on my recent tour of the Boston impact investing conference circuit, which included the New England Impact Investing Initiative/Building a Sustainable Investment Community (BASIC), Boston’s Net Impact Summit, and the Harvard Social Enterprise Conference. My list of all the 2018 trends discussed at these events, has 20 trends on it! Wow, that’s a busy year. This blog post is my attempt to distill these trends into four buckets (many of which are linked) and see whether CFI readers agree with this general direction for impact investing in the year ahead.

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Recommendations for how Colombia’s banks, fintechs, telcos, and government can better harness technology to boost inclusion

> Posted by Miriam Freeman

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In Colombia, where institutional factors favor technology as a tool for development, fintech has proven helpful in promoting financial inclusion, but only through a narrow definition of inclusion—more access. If we broaden our definition of financial inclusion, the country’s progress in leveraging fintech is less substantial. What can the business community and policymakers do to advance fintech for financial inclusion in Colombia?

First, let’s take a step back. In terms of financial inclusion broadly, how does Colombia measure up?

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A breakdown on gender diversity in the digital currency industry

> Posted by Jeffrey Riecke, Senior Specialist, Center for Financial Inclusion at Accion

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Is cryptocurrency a household word now? How about blockchain or Bitcoin? You don’t have to be immersed in financial services to regularly hear about the soaring values of digital currencies, the launch of new products and systems, and other industry developments. Just last week, for example, the Government of Venezuela announced that it was launching a national cryptocurrency backed by its petrol supply. Switzerland is doing the same. And they’re only two of a growing list of countries actively exploring alternative digital currencies.

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From pay-as-you-go models to products that do away with exclusions, the rules of inclusive insurance are changing 

This post is adapted from the recently-released publication “Inclusive Insurance: Closing the Protection Gap for Emerging Customers,” a joint-report from the Center for Financial Inclusion at Accion and the Institute of International Finance, in partnership with MetLife Foundation.

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With digital channels and effective aggregators, it becomes possible to offer insurance to lower-income segments. But the products themselves must also be designed with both cost control and the needs of the client segment in mind. After all, the financial margins for inclusive insurance are smaller, and the value proposition of insurance is typically tough to sell to customers.

Drawing on insights from our recently-released report Inclusive Insurance: Closing the Protection Gap for Emerging Customers, here are a few of the key approaches for building inclusive insurance products that work for the insurer and the customer.

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Credit Suisse is a founding sponsor of the Center for Financial Inclusion. The Credit Suisse Group Foundation looks to its philanthropic partners to foster research, innovation and constructive dialogue in order to spread best practices and develop new solutions for financial inclusion.


The views and opinions expressed on this blog, except where otherwise noted, are those of the authors and guest bloggers and do not necessarily reflect the views of the Center for Financial Inclusion or its affiliates.