You are currently browsing the monthly archive for May 2012.
> Posted by Susan Buckles, Northwest Area Foundation
The Great Recession has left a wake significantly larger than the downturns of the early ‘80s, ‘90s, and 2000s. Officially declared over, the recession has left millions of Americans stripped of their assets. Many are fighting to stay out of poverty as they struggle with unemployment, reduced wages, or home foreclosures. According to real estate website, Zillow, 30 percent of all Americans now owe more on their mortgages than their homes are worth. The message is clear: In order to thrive, low- and moderate-income families need living-wage jobs and assets to weather financial storms.
Grassroots & Groundwork: Working Together to Reduce Poverty and Build Prosperity is a national conference that will share emerging and proven models that are successfully addressing those issues. Northwest Area Foundation, the conference sponsor, believes that a key part of building financial security is well-paying jobs. Read the rest of this entry »
> Posted by Center Staff
The recent release of the Global Findex marked a crucial step towards global full financial inclusion. In a post on the CGAP Microfinance Blog, CFI’s Managing Director, Elisabeth Rhyne, discusses the importance of this financial inclusion database for providing demand-side data and allowing service providers to better understand client needs.
The post begins:
With the release by Gallup and the World Bank of the Global Findex (Financial Inclusion Index), the path to financial inclusion has just been made a little easier to travel.
Last year we (the Center for Financial Inclusion) asked practitioners, investors and others to tell us about the biggest “Opportunities and Obstacles to Financial Inclusion”. They identified “Limited understanding of client needs” as the fourth-ranked obstacle and “Improved demand-side information” the tenth-rated opportunity. The availability of data from the Global Findex will go a long way to satisfy those needs, and if data is as important as our respondents believe, it means that a significant constraint to inclusion is starting to give way. Read the rest of this entry »
> Posted by Lauren Burnhill, Managing Director, One Planet Ventures
If social change is hard to achieve, raising funds for innovative programs that target social change is twice as difficult, but things are looking up! Recently, the White House Office of Social Innovation announced a proposed change in the rules governing program related investments (PRIs) made by foundations.
Every microfinance, social impact or environmental group that has tried to mobilize foundation resources for innovative concepts, pilots or ventures knows how difficult it is to access PRI funding. For fear of endangering their tax status, most foundations have exclusively focused on making grants to non-profit organizations.
In other words, under existing regulations, foundations believe themselves limited to making grants or supporting studies and research related to social enterprise and the impact investment industry. Yet when we look at obstacles to catalyzing private investment, there is a strong need to find actors that can change the risk profile associated with funding these activities, in order to facilitate the entry of new private investors. Foundations seem like a logical candidate to play this role, but until now, they have not felt empowered to do so. Read the rest of this entry »
> Posted by Center Staff
This edition of Top Picks includes topics on the history of the financial sector, particularly in context of women, financial services for rural and agricultural communities, and areas in which microfinance has succeeded. These posts offer a look into some of the very interesting discussions that are occurring outside of the Center.
- What was banking like for women at the turn of the century? And why is it important to consider this history today? A recent post on the Financial Access Initiative blog, “Women in Banking“, briefly discusses the social components of financial services and offers some great resources for exploring the history of banking. Read the rest of this entry »
> Posted by Maggie Long
The unique role of microfinance networks and associations in the industry’s adoption of client protection practices, while often overlooked, is quite extensive. For example, as the new Smart Note describes, the Azerbaijan Microfinance Association (AMFA), as part of their larger social performance management strategy, actively supports its 28 member organizations in the adoption of the Client Protect Principles through a variety of services.
In order to generate interest and convince its members to commit to client protection, AMFA offers trainings on client protection, provides and creates client protection materials, and recently sponsored a study that included 2,000 client interviews. In addition to all of these initiatives, and thanks to funding from USAID, several AMFA staff members have been trained in the client protection assessment methodology and have since been able to perform assessments on MFIs within their network. Read the rest of this entry »
> Posted by Henry Jackelen, Jackelen Associates
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.
We’ve always known that microcredit is not a panacea.
During the heady days of the microcredit revolution in the 1980s and 90s, I was part of a veritable village of practitioners. It was a remarkable group of driven, passionate, and often iconoclastic individuals. We lived in our own Utopia, defining and inventing the concept of social enterprise. But even then we knew that our microcredit efforts weren’t perfect.
When I first visited Bangladesh in 1983, my role was to review the Grameen and BRAC programs as part of developing a new World Bank program (which proposed what became known as the Palli Karma Shayak Foundation or PKSF, a successful Apex for MFIs). Read the rest of this entry »
> Posted by Danielle Donza
The Council of Microfinance Equity Funds (CMEF) and MicroFinance Network (MFN) recently surveyed their members to find out whether MFIs are paying the people who sit on MFI boards– and if so, how much.
Some observers argue that the practice of offering payment to board members will ultimately attract members with the wrong motivations. They believe that the “right” board members are willing to serve on the board for free because of their passion for the microfinance mission. In fact, this is often true: many MFIs don’t pay their board members at all – 40 percent and 25 percent, for CMEF and MFN respectively.
However, as the microfinance industry matures, and the responsibilities of governance increase, MFIs need to be prepared to compensate their directors in order to attract highly qualified board members with the knowledge to govern a financial institution well. So, it is not surprising that among those MFIs linked to CMEF and MFN the majority do provide monetary compensation. Read the rest of this entry »
> Posted by Sonja Kelly
Let’s say you have a checking account with First Imaginary Bank. One day First Imaginary Bank wants product feedback because they are thinking of extending their product line. They might ask you to answer this question:
How do you feel about your checking account?
a) It’s great! I really like it.
b) It’s sufficient for what I use it for.
c) It’s sufficient, but I think I could find something better.
d) It’s awful, and I am planning on closing it as soon as possible.
The biggest problem with this kind of market research is that it only gathers information about the status quo, and only for one product. It does well by talking to the consumer, but it is so narrowly focused that we only find out about the preferences surrounding a particular checking account. It’s useful but only as far as the checking account is concerned. It gives First Imaginary Bank very little information about future products. Read the rest of this entry »
> Posted by Center Staff
Yesterday, Micheal Schlein, President and CEO, and Diana Taylor, Chairman of the Board, of Accion, released an op-ed piece on Forbes.com describing the launch of the Venture Lab. This exciting new initiative works to provide seed capital and support to innovative startups in financial inclusion.
The piece begins:
Over the last several years, the world has woken up to the enormous market potential of serving 2-3 billion people at the base of the economic pyramid. A growing cadre of investors recognizes that we can create new ways to meet the needs of this huge population in a sustainable, business-like way. A new wave of socially responsible funds, institutional investors, microfinance investment vehicles, banks and even conventional venture and private equity funds collectively have raised billions to invest in social enterprises. Read the rest of this entry »
> Posted by Center Staff
As a way to assist the microfinance industry in adopting and implementing the Client Protection Principles, the Smart Campaign has developed an extensive collection of tools, including Smart Notes, training manuals, and various other educational materials on codes of ethics, over-indebtedness, transparency and much more.
To help microfinance institutions (MFIs), investors, and networks/associations navigate through the tools and figure out which resources best serve their needs, the Smart Campaign (thanks to the support of the Ford Foundation) has developed a comprehensive training that introduces the variety of tools available and suggests ways that they can be used. Read the rest of this entry »
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