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> Posted by Steve Wright, Director, Social Performance Management Center, Grameen Foundation and Kate Griffin, Director, Solutions for the Poorest, Grameen Foundation

In the recent New York Times article, “How Companies Learn your Secrets”, Charles Duhigg discusses how companies can use demographics and data on personal consumption behavior to manipulate shopping habits and attract new customers. Target, for example, can predict if a customer is pregnant, what trimester she is in, and, with this information, target baby-related advertisements to her. For many consumers, this use of “big data” (very large and complex data sets and the analytics to mine them), seems like an unacceptable intrusion of privacy. For many of us working in microfinance and development, this concept produces a reflexive “Eewww,” probably because our goals are much less about directing consumption through marketing than they are about increasing the opportunity and capacity to consume.

Despite this initial reaction to the manipulation of customer data to drive profits, the use of big data can actually prove very effective for the fields of microfinance and financial inclusion. At Grameen Foundation, we strive to: 1) examine large datasets to find relevant patterns and leverage opportunities, and 2) build tools and systems that use data to enable the poor to improve their quality of life. Read the rest of this entry »