You are currently browsing the monthly archive for May 2011.
> Posted by Stephanie Dolan, Principal Specialist, Investing in Inclusive Finance
How do you recognize or quantify the time and effort that a non-profit’s founder has poured into an organization? Do you reward a non-profit’s board members for their countless hours donated to shaping the institution’s mission, and if so, how? What role does the staff have in determining the success of an organization? What skills and qualities are necessary in a manager, and what should be done if his skills set no longer meets the needs of an institution?
Such questions normally circulate beneath the surface at any operating non-profit. However, they truly come to light during periods of institutional transition, for example, during transformation to a for-profit or a merger of organizations. As these questions are often intensely personal, they have the potential to become, on the one hand, a bitter point of contention or, on the other, an opportunity for frank discussion and collaboration. Read the rest of this entry »
> Posted by Adriana Magdas, Communications and Events Associate
I recently had the opportunity to discuss the Smart Campaign with representatives of MFIs, support organizations, foundations, investors, and universities. The venue for these conversations was the Microfinance USA conference, which ran May 23-24 in New York City.
The conference, which served as a place for the Center to introduce the Smart Campaign to the microfinance community in the US, was organized by Opportunity Fund, ACCION USA, and Kiva. The nation’s top practitioners, investors, and researchers took advantage of the event to discuss the future of US microfinance and to rally MFIs, investors, donors, and support organizations around the common goal of incorporating client protection across the industry.
As a conference guest on behalf of the Smart Campaign, I was interested to hear leaders from Opportunity Fund, Kiva , and ACCION International call on US microlenders to join them as Campaign endorsers and stress the importance of creating quality products that are fair and transparent. Read the rest of this entry »
> Posted by Beth Rhyne
One of the problems with financial education is that many of the targeted audience think it is BOR-ING, and don’t sign up or show up for sessions. Yesterday at the Microfinance USA conference, I listened to several people who are seeking to make financial education more fun, and in the process, ensuring that it will have a bigger effect on actual behavior.
First, Brooke Berman from Innovations for Poverty Action (www.poverty-action.org) described how their projects put randomized control trials and behavioral economics to work to design products to motivate clients to save. An IPA-designed commitment savings account might send you messages about the value of savings and at the same time warn you if you fall off track to meet your goals. It might even tell your (pre-selected) friends if you fall behind. This is not necessarily fun, but it does combine the behavioral economists’ popular idea of nudges with messages about why savings is a good idea. Read the rest of this entry »
> Posted by JD Bergeron, Kiva Sr. Director of Social Performance and Alyssa McGarry, Kiva Community Outreach Team
Kiva prides itself on its ability to provide financial services to low-income individuals and those who do not have access to typical banking services. We strive to impact the most vulnerable, and our model allows us to focus attention on groups and individuals that might not be served otherwise. One group that are typically among the most marginalized are people with disabilities. Kiva acknowledges that people with disabilities exist in all cultures of the world and we are proud that our community is taking strides to better support them.
The Kiva community recognizes that disabilities need not limit one’s desire or ability to hold a job, impact the community, or become financially independent. Kiva and our Field Partners support entrepreneurial spirit. We embrace a world where all people – even in the most remote areas of the globe – hold the power to create opportunity for themselves and others.
Kiva Lending Teams Focused on Disabilities
Kiva’s community has already formed a number of Lending Teams that give loans primarily to people with disabilities and their families. The largest is KivaFriends – Disabled Persons . This group has 100 members and has lent a combined $29,700, with an impressive 11.7 loans on average per member. KivaFriends – Disabled Persons is a community of people interested in making a difference for entrepreneurs and families who are affected by illness or physical, intellectual, or psychiatric disability. They also support caregivers and entrepreneurs involved in the medical profession. Read the rest of this entry »
> Posted by Center Staff
The Smart Campaign and MicroFinance Transparency (MFTransparency) have unveiled the new tool “Putting Transparency into Practice: Communicating About Pricing.”
The tool describes how financial service providers can observe the principle of transparency, notes current resources that exist to help providers understand and communicate their prices to clients, and points readers to where they can find more Smart Campaign tools and MFTransparency resources.
The Smart Campaign and MFTransparency are complementary efforts to increase transparency in the microfinance industry and institutionalize strong client protection practices in the sector.
While the Smart Campaign advances the Client Protection Principles, MFTransparency specializes in deep technical knowledge of one of those principles, “transparency,” and supports analysis of a second, “responsible pricing.” The Smart Campaign endorses the work of MFTransparency and promotes the use of their resources and expertise.
Image credit: G Ambrus
> Posted by Center Staff
Martin Burt created the microfinance NGO Fundación Paraguaya (FP) in 1985 with the idea of zeroing in on the problem of chronic unemployment in his homeland’s urban slums and rural areas. FP grew to be one of Latin America’s best-performing microfinance institutions, and today it serves 70,000 clients, most below the poverty line. FP was the first development NGO in Paraguay and the country’s first microenterprise program.
Burt has further ambitious plans to build microfinance’s potential as a tool to help people lift themselves out of poverty.
“If we want to graduate people across the poverty line, we have to visualize what that means—what type of latrine they should have, what vaccinations,” he says. “Any family can obtain a good latrine or stove if they have the will; they usually are held back by a lack of motivation and skills, as well as by doubts—can I do it? We’re working on motivation and skills.”
Burt shares his thoughts on the microfinance industry past, present, and future in the fourth installment of the “Microfinance Matters” interview series:
Martin Burt
Fundación Paraguaya: Stretching Microfinance, Narrowing Poverty
Imagine yourself as an idealistic new graduate eager to make a difference in the world. You probably don’t want to come home to a malevolent old dictatorship. When Martin Burt returned to his native Paraguay in 1983 after graduate studies in public administration in the US, he saw no room for his new skills in the oppressive government run by General Alfredo Stroessner, then in his 39th year in office.
Burt could have easily fled and become part of the Latin American brain drain. But he never seriously considered that option. “In a poor country, if you’re born into a family that can send you to a good school, you have a moral obligation to help the less fortunate,” he explains.
To read more of the interview with Burt, click here.
> Posted by Rosita Najmi, Program Manager, Financial Inclusion for Persons with Disabilities
“Hire Me?” was the question one graduate of Gallaudet University chose as an adornment on the top of her graduation cap. Last week, as the disability and human rights communities, and all of us who care about inclusion, celebrated the 100th ratification of the UN Convention on the Rights of Persons with Disabilities (CRPD) I had the pleasure of celebrating the academic and personal achievements of an intern with whom I have been working since February. I joined proud parents, siblings, and professors at Gallaudet University’s 142nd Commencement. Since then, I’ve been considering how the bold question of that one graduate fits the context of financial inclusion.
In a previous blog post about the Center’s program Financial Inclusion for Persons with Disabilities, we found a series of questions. One was directed at the Human Resources Department of financial service providers: “Are there any qualified persons with disabilities in your community you could consider for employment, an internship, or a volunteer opportunity?” In this post, we ask, “If you had two candidates who equally met your checklist of eligibility criteria, and one of them had a disability, how would you decide? To whom would you say yes?” Read the rest of this entry »
> Posted by Center Staff
For centuries, sages, poets, and scientists have punched the clock and collected paychecks for puzzling over “what women want.” Forbes journalist Lisa Quast is now posting her answer to that question, at least in terms of microfinance.
Quast interviews Women’s World Banking President and CEO Mary Ellen Iskenderian in a three-part series. In the second post, “What Women Want from Microfinance,” Iskenderian zeroes in on savings as a must-have product. Iskenderian also identifies financial education as a key to making savings accessible to women.
There’s a lot more to it, of course. Quast’s three-part series – well worth a read – starts here.
Image credit: Tango Desktop Project
> Posted by Center Staff
The Council of Microfinance Equity Funds (CMEF) is proud to issue its latest paper, “Growth in Commercial Microfinance: 2005-2008.”
This work by Preetesh Kantak illustrates the significant changes in the commercial microfinance industry over the past four years. Traditionally, growth studies, such as MicroRate’s annual microfinance investment vehicles (MIVs) survey, have focused on growth in the assets of MIVs. This growth has been phenomenal, and of course strongly influences the MFIs in which they invest. The “Growth in Commercial Microfinance” series, of which this is the third publication, dissects and clarifies growth in the MFIs themselves – the actual investment opportunity-set. With this study, CMEF gauges the opportunities available to investors in MFIs.
The first study of this series, published in 2004, focused on the transformation process of NGOs and start-up MFIs into regulated, for-profit entities. A large part of this effort was the enumeration of guiding corporate governance principles and the impact that this new business model had on the sustainability of the institutions and industry. The second study, published in 2006, examined industry growth in the preceding two years, and explored the distribution of MFIs, borrowers and depositors by region.
In this latest installment, the author first analyzes the internal, “organic” growth of MFIs presented in the 2006 study. The report explores the increasing and more pervasive efforts at financial intermediation and how the growth of saving products have matched, if not exceeded, the growth of loan products. Read the rest of this entry »
> Posted by Michelle Romeu
Last week, the Reserve Bank of India (RBI) made changes to their regulations in light of the recommendations of the Malegam Committee. Take a look at a sample of thoughts on the matter:
- M-CRIL assesses the strengths and weaknesses of the new regulations for India’s microfinance sector.
- The MIX looks at the potential effects that the new regulations could have on differently sized microfinance institutions in India.
- India Development Blog discusses the challenges of effectively implementing the new regulations.
Elsewhere in the blogosphere:
- David Roodman ponders where the next microfinance crisis (reminiscent of the troubles in Andhra Pradesh) could develop.
- CGAP continues its series on savings by exploring Haiti’s borlette—“part casino, part dream parlor, part bank”—system; suggesting that a prize-linked savings program could motivate more people to adopt effective savings practices.
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