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> Posted by Rupert Scofield, Chair of the Partnership for Responsible Financial Inclusion (PRFI)

A meeting of the Partnership for Responsible Financial Inclusion in September 2017 (pictured from left to right: Shameran Abed, Jesse Fripp, Steve Hollingworth, Maria Cavalcanti, Michael Schlein, Sharlene Brown, Rupert Scofield, and Robert Dunn. Not pictured: Christian Pennotti, Mary Ellen Iskenderian, and Michael Mithika)

In 2011, I joined the inaugural meeting of CEOs that led to the formation of the Microfinance CEO Working Group. Nearly seven years later, my colleagues and I have continued to enjoy the trust and collaboration made possible by sitting together and sharing our strategies, challenges, and opportunities. We have encouraged the sharing of information among key senior staff in seven departments such as risk management, social performance, and digital financial services, across our networks. This collective of senior managers, which we refer to as peer groups, find the conversations at their levels insightful and that they allow for greater efficiency at solving common problems. In some cases, members benefit from non-proprietary work and processes developed by another. In other cases, we are creating the solutions together. Today, we truly recognize that we are no longer a working group, but a strong partnership committed to advancing financial inclusion in a responsible manner. It is my pleasure to share our new name: Partnership for Responsible Financial Inclusion (PRFI).

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> Posted by the Microfinance CEO Working Group

(click to enlarge)

What’s been happening with the Microfinance CEO Working Group (MCWG)? We’re glad you asked. Fresh-off-the-press is a new annual report from the MCWG, detailing the Working Group’s key accomplishments and activities of the past year. Consumer protection is among the standout areas for the MCWG for 2016. Over the course of the year, 14 local partners belonging to the MCWG network achieved Smart Certification, including BRAC Bangladesh, the first microfinance provider in the country and the largest in the world to reach the consumer protection milestone. In total, 21.9 million clients are served by 39 MCWG network Smart Certified institutions.

The MCWG is comprised of the leaders of 10 global microfinance organizations: Accion; Aga Khan Agency for Microfinance; BRAC; CARE; FINCA; Grameen Foundation; Opportunity International; Pro Mujer; VisionFund International; and Women’s World Banking. The newest member, added in 2016, is the Aga Khan Agency for Microfinance and its General Manager Jesse Fripp. The MCWG also harnesses the expertise of more than 40 senior staffers across the member organizations, who meet regularly across seven Peer Groups focused on specific areas of microfinance, from digital financial services, to social performance, to communications, taxation, and others. Members and local partners work with more than 89 million clients in 87 countries, providing them with financial services as well as other support to help them succeed and lift their families out of poverty.

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> Posted by Julia Arnold, Financial Inclusion Consultant and Sarah Willis, MetLife Foundation

MetLife Foundation’s goal is to improve financial inclusion across its footprint, which includes economically and geographically diverse markets. Ensuring that low- and moderate-income families in these markets can acquire and successfully use the products and services they need to build a better, more secure life is complex and therefore requires innovative solutions that reach different consumers in different ways.

In China, our newest approach to improving the financial health of everyday consumers is through harnessing the power of social entrepreneurs. As part of a broader global push to strengthen ventures and organizations working in the area of financial inclusion, we’ve teamed up with Verb to run a series of competitions, called Inclusion Plus. Beginning on May 19, 2016 we will invite social enterprises (nonprofit and for-profit alike) throughout China that are focused on increasing access and use of financial services among low- to moderate-income people to enter their products, services, or programs for the chance to win grant capital and mentoring from MetLife advisors.

Opening a competition in China meant we needed to better understand the local financial inclusion landscape. We know that the rapid economic growth in China over the past 20 years has been the envy of the world. More surprisingly, however, is that between 2011 and 2014 China made significant strides toward financial inclusion adding around 180 million adult account holders, bringing the number of adult account holders to 79 percent of the population. According to the 2014 Global Findex, these account holders include marginalized groups such as women and poorer rural households, though the bulk of China’s unbanked population resides in rural areas, and over half of whom are women. As such, the Foundation’s focus for the Inclusion Plus competition is on ensuring the unbanked or underserved populations, such as low-wage workers, smallholder farmers, small business owners, and migrant workers have access to affordable and convenient financial services and products which focus on day-to-day financial well-being.

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> Posted by the Smart Campaign

Today we’re excited to announce that Alalay Sa Kaunlaran (ASKI) is the first financial institution in the Philippines to be certified by the Smart Campaign. Clients of financial services can face risks. They can get into too much debt, be taken advantage of, or sold the wrong services. Financial institutions can minimize harm to clients by implementing the Client Protection Principles, a common, global framework for client protection. By becoming Smart Certified, an institution demonstrates that it puts the principles into practice.

The non-profit institution earned its Smart Certification in late July following a mission conducted by Microfinanza Rating, and is being publicly recognized today in conjunction with the Asia-Pacific Financial Inclusion Summit 2015, in Manila.

Established in 1987 in central Luzon to serve and empower the poor through microenterprise development, ASKI today serves more than 136,000 clients through 72 branches and 7,794 solidarity groups in 234 cities and towns.

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> Posted by Center Staff

fi2020 issue five

Good afternoon! Freshly published is this week’s Financial Inclusion 2020 News Feed, sharing the big news in banking the unbanked. Among its stories are a new partnership between MetLife Foundation and Opportunity International to expand financing and skills training in rural China, the launch of a World Food Programme initiative that integrates climate risk reduction with financial services, and the release of the first annual Consumer Banking PACE Index, which gauges bank performance to consumer expectations. Here are a few more details:

  • MetLife Foundation and Opportunity International have embarked on a three-year partnership to support thousands of small businesses in rural China with financial services and business development training via banks, mobile vans, and rural service centers.
  • The World Food Programme launched the R4 Rural Resilience Initiative, which helps smallholder famers in Zambia navigate environmental demands using index-based agricultural insurance, improved natural resource management, credit, savings, and productive safety nets.
  • The new Consumer Banking PACE Index, drawing on input from over 9,000 consumers, examines bank performance in a handful of countries around the world to conclude that, among other findings, fair and transparent pricing falls below consumer expectations, and trust in banks remains an issue.

For more information on these and other stories, read the fifth issue of the FI2020 News Feed here, and make sure to subscribe to the weekly online magazine by entering your email address in the right-hand menu so you can be notified when the latest issue comes out.

Have you come across a story or initiative you think we should cover? Email your ideas to us at ezuehlke@accion.org.

> Posted by Anne Hastings and Tyler Owens, Microfinance CEO Working Group

The following post was originally published on the Microcredit Summit Campaign’s blog, 100millionideas.org.

Since its inception in the spring of 2011, the Microfinance CEO Working Group has worked diligently and collaboratively to define the concept of Responsible Microfinance around the globe and lead by example to try to fulfill this vision. It has focused on three key pillars on which Responsible Microfinance is built: client protection, pricing transparency, and social performance management. A responsible microfinance institution (MFI) is one that, at a minimum:

  • Does all in its power to protect its clients from harm;
  • Is transparent about fees and interest rates; and
  • Implements best practices in social performance management including monitoring effectiveness in achieving desired client level outcomes.

An MFI can achieve this by complying with the industry-developed standards of the Smart Campaign, MicroFinance Transparency, and the Social Performance Task Force, known as the Universal Standards for Social Performance Management.

The Working Group is a collaborative effort of the CEOs of Accion International, FINCA International, Freedom from Hunger, Grameen Foundation, Opportunity International, Pro Mujer, VisionFund, and Women’s World Banking. At the Microcredit Summit in Manila in October 2013, the Working Group publicly encouraged its collective 224 affiliated MFIs around the globe to embrace Responsible Microfinance by sharing a list of commitments. Since making those commitments, the group has made significant headway toward strengthening each one of the pillars of Responsible Microfinance.

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> Posted by Elisabeth Rhyne, Managing Director, CFI

I was recently asked to give a talk at the University of Pennsylvania’s 8th (!) annual Microfinance Conference. This year’s theme, “Microfinance Beyond Its Roots” set me in search of ways in which the microfinance industry is moving into areas beyond its original microcredit core. Of course, this process has been going on for a long time, and so there are many topics to choose from.

I decided to look at health care, partly because, as every staff member of a microfinance institution knows, health setbacks are one of the most frequent sources of repayment problems among low income clients. As they learned about the health vulnerabilities of their clients, microfinance organizations began to invest in experiments, bringing their businesslike approach to bear on a challenge that is often dealt with in heavily subsidized, non-market ways. Today, many of these programs have matured and grown, even as new ideas are being tested.

I looked among the organizations belonging to the Microfinance CEO Working Group, and I found that nearly all have something exciting going on in health care. Approaches include some combination of direct health care service provision, health insurance coverage, and education. Many are using technology as a means of reaching people at scale and low cost.

The meetings associated with group lending provide a convenient and cost-effective platform for health services, and adding a health component to group microcredit is probably the earliest and most widespread model. Health education was perhaps the starting point, as pioneered by Freedom from Hunger and also implemented by Opportunity International. Today the services often reach farther (while health education continues to be important). ProMujer, for example, directly employs nurses and other health practitioners to staff fixed and mobile clinics available to ProMujer members. They focus on maternal and reproductive health, as well as screening for the chronic diseases that are increasingly major health issues in Latin America. Hundreds of thousands of women get access to health care through ProMujer’s efforts.

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> Posted by Mary Hansen, Organizational Development and Training Associate, Accion

842 million people struggle through the hunger games yearly. The games begin as food and money run low sometime before harvest and last until the first ripe crops. This is better known as los meses flacos, the thin months, in Latin America. Or as I knew it in East Africa, wanjala in Swahili and nyengo yonjala in Chichewa (the hunger season). These recurring hunger games are not state sponsored and the participants do not fight each other to the death, but they do fight individuals, families, or communities to survive. Every day, 25,000 people around the world die from hunger-related causes, including 16,000 children. That’s one child every five seconds.

The regions deeply affected by hunger depend heavily on smallholder farming. Around 75 percent of the world’s poor are smallholder farmers. Half of the world’s undernourished people, including three-quarters of Africa’s malnourished children and the majority of those living in absolute poverty live on small farms.

Many of these farmers face the struggle of the hungry season. To understand their situation, consider how you would budget if you were only paid a few times a year.

Personally, I struggle with budgeting when paid twice a month. When I was in the Peace Corps in Malawi and was paid monthly, I struggled even more. Yet, smallholder farmers often receive payment only during harvest, or twice a year. I still do not fully understand how families survive with this income structure, even though I lived in a rural town in Malawi for two years. Yet, this is the reality for many of the 2.5 billion people that depend on smallholder agriculture for their livelihoods.

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> Posted by Calum Scott, Program Impact Director, Opportunity International 

An Opportunity International client talks with her loan officer while examining her cocoa beans.

As a network of 40 microfinance institutions in 22 countries, Opportunity International is well positioned to play a powerful role in supporting the positive development of the microfinance industry. For client protection, we believe that the Smart Campaign’s Client Protection Certification represents the highest standard of assurance that an institution’s practices are responsible.

To promote client protection and certification among our network, we’ve engaged the support of MicroFinanza Rating – a specialized microfinance rating agency and one of the Smart Campaign’s licensed certifiers.

The agreement with MicroFinanza will facilitate our network partners to undergo certification missions, and promote the sharing of lessons learned from certification experiences across our network of institutions. This agreement also demonstrates our confidence in the quality of the work that MicroFinanza does.

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> Posted by Anne Hastings, Manager, Microfinance CEO Working Group 

The CEOs of eight leading global microfinance networks – Accion, FINCA, Freedom from Hunger, Grameen Foundation, Opportunity International, Pro Mujer, VisionFund International, and Women’s World Banking – made six significant commitments at the Microcredit Summit Campaign’s Partnerships Against Poverty Summit last week in Manila. These eight CEOs make up the Microfinance CEO Working Group. Together they represent more than 250 retail microfinance institutions in 70 countries globally and provide financial and often non-financial services to more than 40 million families.

Here are the commitments:

1. Client Protection: Encourage all affiliates to progress toward Smart Campaign certification and be on a pathway toward certification by the end of 2014.

2. Pricing Transparency: Motivate our affiliates to commit to pricing transparency and integrity by agreeing to publish their pricing data using standard methodologies, such as those developed by MicroFinance Transparency, in order to allow investors and clients to make informed decisions.

3. Social Performance: Promote the Social Performance Task Force’s Universal Standards for Social Performance Management among our affiliates and commit to supporting their compliance.

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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.