You are currently browsing the monthly archive for April 2012.
> Posted by Guy Stuart, Faculty Council Member, The Center for Financial Inclusion
In her recent paper “The Financial Behavior of Rural Residents: Findings from Five Latin American Countries,” Jacqueline Urquizo segments the savings market at three levels. The first level identifies whether the individual saves or not. The second level identifies how they save – in constant, small amounts, in sporadically larger amounts, or by simply holding, statically, a sum that they accumulated in the past. The third level identifies the source of savings: money set aside before the individual makes their usual expenditures; money left over after all expenditures have been made; or money earned through extra, income-generating activities.
Though data I have collected using the Financial Diaries methodology, suggest that almost all people save, even if it is only from week-to-week to smooth consumption, the paper’s approach to segmentation offers a key insight. That is, its approach to market segmentation focuses attention on consumer behavior rather than their socio-economic characteristics, such as age, income or livelihood. Though the latter and the former are related, consumer behavior is far more important for financial service providers to understand than consumers’ socio-economic characteristics. Read the rest of this entry »
> Posted by Lisa Kuhn Fraioli, Vice President, Latin America, Freedom from Hunger
This post is part of the Center for Financial Inclusion’s Expert Exchange: Building A Movement Toward Financial Inclusion by 2020, cultivating conversation around the goal of reaching full financial inclusion by 2020. For further questions about this series, write to , Fellow, Center for Financial Inclusion at Accion.
A few weeks ago, I found myself in Loja, Ecuador leading a delegation of board members, supporters, and their families in a visit to some of Freedom from Hunger’s newest partners. We were visiting a client who was part of a special credit program for families with disabled children.
The first woman that we visited lived in a semi-rural area. She had a tilapia farm, various fruit trees, herbs, and a whole variety of small-scale agricultural projects. Our delegation, which was very business-savvy, asked many insightful and detailed questions about her investments and returns on each of her activities. As is common, her answers were not very precise and somewhat contradictory. But, when they asked her for her vision for 5 years from now, her answer was clear—“I don’t want to have to worry as much.” While this might not have been much of a business plan, it was guiding her choices every day. Read the rest of this entry »
> Posted by Center Staff
This morning, Accion released a report, “The Financial Behavior of Rural Residents: Findings from Five Latin American Countries.” The report, by Jacqueline Urquizo, provides the financial industry with new information relevant for improving financial services to rural residents in Latin America.
The study is based on market research conducted in Colombia, Dominican Republic, Ecuador, Nicaragua and Peru and provides a detailed portrait of access, use and attitudes towards financial services by rural residents, both farmers and microentrepreneurs.
Rural residents are some of the poorest and hardest-to-reach populations in the world. The study offers a unique opportunity to understand the financial choices rural residents make and the attitudes they bring when they interact with banks and microfinance institutions.
We at CFI think these are some of the more interesting findings:
- Working capital credit and savings are the best known and most used formal financial services. However, while 80 percent of respondents say they know about these products, only 40 percent use them. Read the rest of this entry »
> Posted by Susy Cheston, Senior Advisor for the Center for Financial Inclusion at Accion
This post is part of the Center for Financial Inclusion’s Expert Exchange: Building A Movement Toward Financial Inclusion by 2020, cultivating conversation around the goal of reaching full financial inclusion by 2020. For further questions about this series, write to , Fellow, Center for Financial Inclusion at ACCION International.
Overheard at a party in Washington: “You should SOOO switch banks! Did you know that my bank offers reimbursement for ATM fees?”
Outside financial inclusion circles, it’s not often that a party conversation turns to a comparison of financial services. And even when it does, what seems like a high level of “financial capability” does not always translate into better use of financial services. If it did, the ease with which Americans talked about the great deal they got when they re-financed their homes would not have gone hand in hand with a financial crisis triggered by flaws in our mortgage banking system. Read the rest of this entry »
> Posted by Elizabeth Davidson
When was the last time you spent a day in a classroom filled with leaders in microfinance? How about an entire week?
Last week, 68 microfinance practitioners, investors, and regulators gathered at Harvard Business School for the 2012 HBS-Accion Program on Strategic Leadership for Microfinance. Hailing from 28 countries and every region of the world, participants had the opportunity to debate the most current and crucial issues in microfinance with colleagues in the industry and professionals from other stakeholder industries that play a role in bringing about financial inclusion around the world. As one of the people behind the scenes in preparing for the course, I was thrilled when the time came to meet the participants in person and sit in on the classroom discussions. Read the rest of this entry »
> Posted by Center Staff
The Smart Campaign recently released the following press release to announce fourteen microfinance organizations with outstanding Codes of Ethics.
Washington, DC, April 18, 2012 — The Smart Campaign, a global initiative to incorporate strong client protection practices across the microfinance industry, today recognized 10 microfinance institutions (MFIs) and four microfinance associations for their excellent Codes of Ethics. These Codes are now published as examples for the industry on the Smart Campaign website. Read the rest of this entry »
> Posted by Susan Johnson, Centre for Development Studies, University of Bath, UK
This post is part of the Center for Financial Inclusion’s Expert Exchange: Building A Movement Toward Financial Inclusion by 2020, cultivating conversation around the goal of reaching full financial inclusion by 2020. For further questions about this series, write to , Fellow, Center for Financial Inclusion at ACCION International.
On Tuesday, April 24, 2012, Susan Johnson will be discussing mobile banking and its implications in Kenya at the Center for Financial Inclusion. This event is open to the public and will be a brown bag luncheon discussion with Women Advancing Microfinance (WAM). For more information and to RSVP, please click here.
Savings have been seen as the “forgotten half” of microfinance for some time, and now the rapid growth of payment services over mobile phones suggests that these too have been a forgotten half! With some 15 million registered users of mobile money transfer services in Kenya, mobile payment services are meeting a vital need. But with access to a mobile money service often being treated as ‘financial inclusion’ in the policy discourse, it is also important to ask whether it really means the same for users as it does for policy makers. Read the rest of this entry »
> Posted by Leora Klapper, Lead Economist in the Finance and Private Sector Research Team of the Development Research Group at the World Bank
Today the World Bank, in partnership with the Bill and Melinda Gates Foundation, unveils an important new source of information that can help advance the financial inclusion agenda. We call it the “Global Findex,” short for the Global Financial Inclusion Database, and it is the first large-scale, comparable, demand-side financial inclusion data-collection exercise of its kind. Using the Gallup World Poll survey, we measure how over 150,000 adults in 148 economies save, borrow, make payments, and manage risk. We also have the ability to disaggregate by gender, age, education, and income, allowing researchers to more precisely identify the unbanked. Eager to get your hands on the data? Click here.
For those that are still with me, let me share some of our initial findings: Read the rest of this entry »
> Posted by Maggie Long
The success of mobile banking in Kenya has led to a lot of discussion about its potential impact on financial inclusion around the globe and, as technology has improved, the discussion has come to include what additional services can be offered through mobile banking. Musoni is a Kenyan microfinance institution that uses mobile technology to provide flexible and convenient loans along with a variety of other services to low-income people based on their needs and preferences.
In the new Smart Note, Appropriate Product Design and Delivery at Musoni, Musoni talks to the Smart Campaign about how they conducted in-depth, participatory research to determine what potential clients wanted and needed from a microfinance institution. Only after thorough client research did they design their product. Through their research they discovered clients wanted better access, more flexibility, price transparency, and financial education.
Musoni found that not only has mobile technology allowed them to address these preferences but it has also reduced clients’ personal risk, lowered delinquency, reduced potential fraud, and created a “positive dynamic” between the MFI and its clients. Read the rest of this entry »
> Posted by Center Staff
In celebration of Earth Day (April 22), this edition of Top Picks features three different posts that are related in some way to our natural environment. The topics include climate-smart agriculture, solar-charging stations, and environmentally-focused impact investing.
- In a very interesting post, “Scaling Climate Smart Agriculture by Financing Small and Growing Business”, CGAP Microfinance explores clean technology in agriculture, sustainable practices in agroforestry, and other climate-smart options for productivity. Read the rest of this entry »
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