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> Posted by the Smart Campaign

The Smart Campaign is thrilled to announce that a new milestone for client protection in microfinance has been reached: there are now 50 financial institutions that have been awarded Smart Certification, recognizing their commitment to fair client treatment and responsible practices. In total, these institutions serve roughly 25 million clients.

The threshold was crossed with a handful of recent certifications – Fortis Microfinance Bank and Grooming Centre in Nigeria; Banco ADOPEM in the Dominican Republic; Fundacion Paraguaya in Paraguay; Pro Mujer in Nicaragua; and AgroInvest in Serbia. Each of these institutions worked over a several month process to assess and upgrade their operations to meet every one of the indicators signifying strong consumer protection practices.

Grooming Centre and Fortis Microfinance Bank collectively reach over a half million clients. Founded in 2006, Grooming Centre operates in 22 states in Nigeria with a network of 376 branches. Grooming Centre offers a range of financial services, including savings and credit, small business loans, agricultural loans, and clean energy financing. Fortis Microfinance Bank, along with offering financial services, provides clients with business support in areas including management, marketing, and administration.

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> Posted by Misha Dave and Jeffrey Riecke, Disability Inclusion Program Manager and Communications Specialist, CFI

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Financial inclusion for persons with disabilities (PWD) is a hugely under-addressed area in the quest to bank the unbanked. Estimates indicate that less than one percent of microfinance clients globally are PWD, despite roughly 15 percent of the global population having some sort of disability, and four-fifths of these individuals living in developing countries. The Center’s Financial Inclusion for PWD program, launched in 2010, has developed steadily since its inception. Here on the CFI blog you might’ve seen us spotlight our Framework for Disability Inclusion, our report on attitudes related to disability inclusion among Indian MFIs, or our disability inclusion partnerships with MFIs.

The program has been busy over the past year. Let’s take a look at a few highlights.

India Partnerships: The Center’s PWD program provides trainings and resources to sensitize and equip MFIs to service PWD clients. The program recently forged new partnerships with two MFIs in India, Grameen Koota and Micrograam, bringing the total number of partnerships with institutions in the country to five. The other three partner institutions in India are Equitas, ESAF, and Annapurna. Across these three original partners, more than 30,000 lower-income disabled persons, including 2,000 visually impaired individuals (a severely excluded disability segment), have been included.

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> Posted by Joshua Goldstein aka Mr. Provocative

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There are no final victories when it comes to providing equal opportunities for groups that have suffered from historic discrimination and exclusion. This is true in the United States. This is true everywhere else in the world.  Attitudinal barriers that belittle and marginalize, originating in class, racial, or religious prejudice, may triumphantly come down in one generation only to be resurrected in the next – or even sooner if some shock to the body politic is great enough.

Thus, watchdog groups like the Center for Financial Inclusion’s Smart Campaign, the Southern Poverty Law Center, and the Anti-Defamation League can never call it quits and declare victory. Backsliding into bigotry is more likely the rule than the exception with our tribal species.

To bolster this glum supposition is this example of the ongoing difficulties facing another beleaguered minority: Twenty-five years after the passage of the Americans with Disabilities Act (ADA), there is new evidence about employment discrimination from researchers at Rutgers and Syracuse University.

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> Posted by Center Staff

International Day of Persons with Disabilities is a global occasion to promote awareness and mobilize support for critical issues relating to the inclusion of persons with disabilities (PWD). To mark the day, we wanted to share with you a new Accion video spotlighting the story of Reshma Babu. At five months old, Reshma contracted polio and lost the use of her legs, yet today, she lives independently. That’s partly due to her job at Accion partner Vindhya, where four out of five workers have some kind of disability. Vindhya is a business process outsourcing company that widely employs PWD to deliver high-quality and competitive services to companies spanning multiple sectors, including microfinance. Vindhya exemplifies how inclusion for PWD is a sustainable model for social enterprise at the base of the pyramid.

Along with partnering with Vindhya, here are some of the ways that Accion and CFI are working to achieve disability inclusion:
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> Posted by Eric Zuehlke, Web and Communications Director, CFI

Accion MfB staff explaining the PLWD product to clients

Last month, Accion Microfinance Bank (MfB) in Nigeria launched the People Living With Disabilities (PLWD) product to provide loans to a marginalized group that has largely been left out of the financial system – people with disabilities (PWD). To mark the occasion, some of the first clients of these loans including a member of the albino community and visually impaired clients attended an opening ceremony, which also included officials from the Central Bank of Nigeria (CBN).

The PLWD launch was the result of close collaboration across organizations and continents. CFI’s Joshua Goldstein and Bunmi Lawson, Managing Director/CEO of Accion Microfinance Bank, met with officials from the Central Bank of Nigeria to garner their support. In addition, CFI’s PWD team in India, including CFI partner v-shesh, advised Accion Microfinance Bank.

At the launch, Bunmi Lawson stated that, “Many people living with disabilities are financially excluded. We are pleased to be able to give them the opportunity to improve their means of livelihood to give them a brighter future.”

I asked Emeka Uzowulu, Head of Business and Product Development at Accion Microfinance Bank in Nigeria to share how this product came about and what their future plans are for reaching PWD.

1. Congratulations on the launch of the PLWD product! Can you give a brief background on how this product came about? What was the history of developing this outreach to persons with disabilities and what was key to getting it off the ground?

At Accion Microfinance Bank, our mission is to economically empower micro-entrepreneurs and low income earners by providing financial services in a sustainable, ethical, and profitable manner. We realize that a sizable number of this group are living with one form of disability or another which limits or frustrates their efforts to be productive, as well as that of their families. In consideration of these challenges, we are committed to identifying and partnering with them in making their futures brighter by providing access to loans, savings, and insurance at a very minimal cost.

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> Posted by Sonja E. Kelly and Misha Dave, CFI

Dhanalakshmi (far right), client at Equitas

If there is one thing we have learned from working on disability and age inclusion in financial services, it is that including these populations in financial services is in some ways easier than practitioners expect it to be but, in other ways, harder than it looks.

In our research on aging and financial inclusion, one of the key insights was that financial service providers of all sizes often apply age caps on credit products. However, many institutions we talked with did not know exactly where these standards came from. Some attributed them to concerns about life expectancy of older clients, some to institutional history (“that’s just the way we do it”), some to the increase of credit portfolio insurance it would incur, and some to a perception of older people as economically dormant.

Many of these concerns can be mitigated by better research and dispelling myths about the creditworthiness of older people. Easy, right? In fact, there are some institutions that apply creative ideas to providing credit to older people. Group guarantees and automatic withdrawal payments on loans from publicly administered pensions through government partnerships are both examples of this.

However, such institutions providing credit to older people seem to be the exception rather than the rule. Worse, convincing institutions to care about this population is not easy. One institution we spoke with in India was baffled by the idea of providing credit to people over the age of 55. “But [the older people] could die and wouldn’t pay the loan,” the product developers insisted. Doing the research and articulating the issue was the easy part — now the hard work begins of advocating on behalf of older people.

Similar attitudinal barriers exist in financial institutions for serving persons with disabilities. Let’s take stock: over one billion people around the world — 1 in 7 of us — have a disability and four-fifths live in developing countries like India. Despite this and the fact that many microfinance institutions (MFIs) claim to be dedicated to “serving the world’s financially excluded people,” less than 1 percent of their clients are persons with disabilities.

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> Posted by Joshua Goldstein, Vice President, Economic Citizenship & Disability Inclusion, CFI

“Over a sixth of the world’s population has directly experienced armed conflict, torture, terrorism, sexual and gender-based violence, ethnic cleansing or genocide,” states the website of the Peter C. Alderman Foundation (PCAF). I recently attended the 8th Annual PCAF Pan-African Psychotrauma Conference in Nairobi, a multidisciplinary event that focuses on psychological trauma in Africa’s war-affected societies. PCAF operates mental health clinics in Cambodia, Kenya, Liberia, and Uganda and conducts trainings for mental health professionals. At the conference, I was surrounded by global leaders from health care, academia, and a litany of organizations working in the mental health space.

At first blush, my participation at such an event might seem odd as my work focuses on disability inclusion for microfinance. But, I’d argue that’s more of a reflection of how society, and our industry, views mental disabilities – with reductive biases – rather than how they fit within microfinance.

I had the privilege of presenting a keynote to the attendees. I discussed whether it’s possible for trauma patients who have gone through a successful course of treatment that includes counseling, medication, and livelihood trainings to become clients of microfinance institutions (MFIs) and build small-sized enterprises. Immediately below is an abridged version of my speech, with the complete text linked at the end.

Can MFIs help victims of trauma find hope and dignity through self-employment?

As a post-traumatic stress disorder (PTSD) survivor myself from the U.S., who received treatment, I believe with all my heart that in a just society poor people with mental health challenges should get the help they need so they can flourish as human beings. Unfortunately, in the international development world I come from, this great cause is barely on the radar—in spite of the fact that reaching the most destitute is at the urgent core of all international development work. Indeed, I share your outrage at the paucity of funding and support for community mental health from governments and foundations.

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> Posted by Alvina Zafar, Deputy Manager, Financial Education and Client Protection, BRAC Microfinance

Financial Inclusion 2020 Blog Series banner imageFinancial Inclusion 2020 (FI2020) is a global multi-stakeholder movement to achieve full financial inclusion, using the year 2020 as a focal point for action. This blog series will spotlight financial inclusion efforts around the globe and share insights from key thought leaders in financial inclusion, with a specific focus on quality beyond access.

“I am not sure if I can repay more loans, and I don’t want to be overburdened by debt.” That was how Noyon, a small grocery shop owner with a physical disability, replied when BRAC asked whether he would like to take a loan to expand his business. This is a common response we hear from clients with disabilities when they’re offered credit products. Many prefer to avoid taking loans unless absolutely necessary. They guard their reputations closely against a society that sees persons with disabilities as less capable, and defaulting on a loan is not a risk they are willing to take. This insight raises an important question with regard to the financial inclusion of persons with disabilities: Is access the biggest barrier?

In 2015, BRAC scaled up its Engaging People with Disabilities project with ADD International, an organization that focuses on campaigning for equal rights and ensuring social justice for people with disabilities. The objective of this partnership is to leverage the access and coverage that ADD International has with people with disabilities in Bangladesh and provide financial services (e.g. savings, loans, insurance, etc.) to interested beneficiaries. As of May of this year, the project has a client base of over 7,000 people with disabilities, with an average loan size of US$ 282 and a repayment rate of 100 percent. Clients are saving on a regular basis, with an average saving account balance of US$ 50. The majority of the clients are entrepreneurs—they own and operate grocery shops, tea stalls, small vending businesses, and the like. One objective of BRAC’s is to empower all clients by building their financial capabilities. A by-product we see in many of our clients from this pursuit is, on top of enhancing their knowledge about financial management, it raises their confidence and self-respect. Since the early days of BRAC’s disability inclusion work, we’ve been grateful to receive technical, advocacy, and other support from CFI. Read the rest of this entry »

> Posted by Center Staff

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Can you confidently speak to the financial inclusion of persons with disabilities (PwDs)? How about the proportion of PwDs that live below the poverty line? …The prevalence of disabilities?

The financial and economic hardships of PwDs don’t get much mainstream attention. You, if you’re like most, don’t know that in the United States, for example, about one-fifth of the population (roughly 60 million) has a disability, PwDs are twice as likely to use informal financial services like payday lenders and check cashers, the unemployment rate for PwDs is more than double the national average, and about one-third of adult PwDs live in poverty. These statistics are severe. Not to mention, current demographic shifts will result in larger older adult populations and position the incidence of disability, and the magnitude of these unmet inclusion needs, to grow.

Last week the Consumer Financial Protection Bureau (CFPB), a mainstream U.S. financial player, announced an initiative that will work in concert with financial empowerment and disability organizations to tackle these pressing issues.

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> Posted by Debashis Sarker, Centre for European Research in Microfinance (CERMi) and University of Mons, Belgium

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With estimates indicating that less than 1 percent of microfinance clients around the world are persons with disabilities (PwDs), it’s clear that sizable barriers exist to the financial inclusion of this largely unbanked population segment. One such barrier is discrimination on the part of microfinance institutions. Two features of microfinance lending make it especially hard to reach definitive statistical estimates of discrimination. One is the complex stages of the microfinance lending process. The second is the self-reinforcing cycle of exclusion that results from the legacies of discriminating microcredit organizations.

A pilot project conducted in Uganda in partnership with the Association of Microfinance Institutions in Uganda (AMFIU) and the National Union of Disabled Persons of Uganda (NUDIPU) demonstrates the discrimination that often occurs in microfinance practices. The project worked with AMFIU microfinance institutions, applying interventions to combat practices discriminatory to PwDs. Along with addressing PwD exclusion by microfinance staff, the initiatives targeted exclusion by other microfinance clients, low self-esteem, product design, and informational and physical barriers. In two years, since the sensitization and accessibility efforts began, attitudes of MFI staff towards PwDs improved and, across eight queried MFI branches, there was an average 96 percent per MFI increase in clients with disabilities. Another study, also based in Uganda with AMFIU and NUDIPU, examined biases against PwDs across different MFI staff. Surveying eight MFIs between 2008 and 2009, staff were asked questions on aspects including risk of loan default among PwD clients. The responses of credit officers indicated they were more biased against PwDs than other MFI staff.

Given these findings, what measures can be taken to combat this?

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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.

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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.