23 Aug 2018
Digital Credit is growing rapidly and is democratizing credit with instant, automated, and remote processes, meeting short-term liquidity needs of low- and middle-income populations. Digital credit, at the onset, has demonstrated financial outreach – offered even to credit invisible customers, who do not have an account ownership or a credit history.
This presentation focuses on the digital credit landscape in Kenya.
13 Jun 2018
The GIIN’s 2018 Annual Impact Investor Survey signals a diverse and dynamic impact investing market. The report findings are based on survey responses from 229 of the world’s leading impact investing organizations, including: fund managers, banks, foundations, development finance institutions, pension funds, insurance companies, and family offices. In total, respondents collectively manage over USD 228 billion in impact investing assets, a figure which serves as the latest best-available ‘floor’ for the size of the impact investing market.
In its eighth edition, this year’s survey provides in-depth analysis of market activity and trends, covering topics such as: capital allocations by sector and geography, indicators of market development and industry challenges, approaches to impact measurement and management, and satisfaction with financial and impact performance. For the first time, this year’s report includes a five-year trends analysis of growth and changes in the industry. The report also presents extensive information on many aspects of today’s impact investing market and sheds light on investors’ perspectives on a variety of current market topics such as: strategies to preserve impact integrity, the level of importance of various technologies to the future of impact investing, the role of public policy, and the role of blended finance.
This report is made possible by the support of the American People through the United States Agency for International Development (USAID). The contents of this report are the sole responsibility of the Global Impact Investing Network (GIIN) and do not necessarily reflect the views of USAID or the United States Government. The report was also produced with the support of the British people through the Department for International Development’s Impact Programme (DFID). The contents of this report do not necessarily reflect the views of DFID or the British Government.
Above originally published on the GIIN’s website.
28 Feb 2018
In June-August, 2017, CGAP, with inputs from FSD Tanzania, conducted surveys in Tanzania to identify customer experiences with digital credit, including uses of digital credit, emerging risks, and the size of the digital credit market. The surveys consisted of:
- Nationally representative phone survey (representative of phone owners), of N=4,574 Tanzanians.
- The sample was drawn from random digit dial technique, which relies on a randomly-generated list of mobile phone numbers in the country.
- The sample is weighted to be representative of adult phone owners in Tanzania.
- Booster surveys with select lenders, with sample sizes ranging from N=300 to N=500.
- The samples were drawn from randomly selected customer lists from each lender.
- The fieldwork was conducted by Innovations in Poverty Action.
CGAP partnered with FSD Kenya to conduct comparable surveys in Kenya, and subsequent analysis will compare market developments in the two countries.
This presentation reports on the findings from the nationally representative sample of phone owners in Tanzania, and includes comparisons to the FinScope 2017 dataset.
17 Sep 2015
Many banks around the world have been successful by focusing their services around micro, small and medium enterprise (MSME) banking. However, there is a tendency for such banks to focus on the higher end of the MSME market, avoiding the risks and administrative costs that come with serving smaller businesses. Şekerbank in Turkey is an interesting case because it has targeted the lower end of the spectrum in its MSME banking line of business. Şekerbank classifies such businesses as craftsmen and “micro” businesses — referring to a business size in between the craftsmen and small business. The bank has been successful in reaching these sectors by tailoring its policies and credit procedures to these markets, as well as by developing products that address the needs of these very small enterprises.
Şekerbank provides an exciting example of a full service commercial bank that has chosen to specialize in serving smaller businesses in Turkey, specifically micro enterprises and craftsmen. These are collectively referred to as very small enterprises, or VSEs, in this publication. This case study is not an assessment of the full operations of Şekerbank. Rather, it is intended to identify the key choices that Şekerbank has made to serve these clients and keep the focus of the bank’s operations on them— instead of defaulting to the easier option of serving larger clients.
06 Sep 2015
Innovations for Poverty Action (IPA) works to identify and rigorously evaluate innovative products and programs that enhance poor households’ access to and usage of improved financial services.
Across developing and advanced economies alike, low-income households need effective and affordable tools to save and borrow money, make and receive payments, and manage risk. In recent years, access to financial services has increased thanks to the expansion of digital finance and the efforts of service providers and governments to reach the unbanked. As access grows, however, we must ensure that the tools available to the poor are effective in helping them manage and grow their money.
IPA partners with service providers, governments, and researchers to design and test financial services and programs that help households better manage their finances. With over 125 completed and ongoing randomized evaluations in 29 countries, IPA’s Financial Inclusion Program seeks to identify effective solutions to promote healthy financial behavior and share results to inform the work of financial service providers and governments around the world.
20 Aug 2015
Financial capability, as defined by the World Bank and in this report, is the capacity to act in one’s best financial interest, given socioeconomic and environmental conditions. It encompasses knowledge (literacy), attitudes, skills and behavior of consumers with respect to understanding, selecting, and using financial services, and the ability to access financial services that fit their needs (World Bank 2013d).
Financial capability has become a policy priority for policy makers seeking to promote beneficial financial inclusion and to ensure financial stability and functioning financial markets. Today people are required to take increasing responsibility for managing a variety of risks over the life cycle. People who make sound financial decisions and who effectively interact with financial service providers are more likely to achieve their financial goals, hedge again financial and economic risks, improve their household’s welfare, and support economic growth. Boosting financial capability has therefore emerged as a policy objective that complements governments’ financial inclusion and consumer protection agendas. To this end, policy makers are increasingly using surveys as diagnostic tools to identify financial capability areas that need improvement and vulnerable segments of the population which could be targeted with specific interventions.
In response to a request of the Bangko Sentral ng Pilipinas (BSP) and as part of a broader engagement on enhancing financial consumer protection and education in the Philippines, the World Bank has implemented a financial capability survey. Financial inclusion, financial literacy and consumer protection are important priorities for the BSP and the Philippines government. Consumer protection and education are critical elements in building an inclusive financial system and BSP seeks to identify sustainable methods of delivering financial education through effective partnerships. As the BSP’s financial inclusion initiatives are expected to usher in more Filipinos, including the previously marginalized sectors, to access a wide range of financial services from a variety of financial institutions, they need to acquire knowledge and develop skills to enable them to make better financial decisions. The proposed survey constitutes a key diagnostic tool that aims to guide BSP on the models for delivering financial education and to set quantifiable and concrete targets. Moreover, it serves as a baseline against which the effectiveness of future financial capability enhancing programs can be assessed. So far, no financial capability surveys have been conducted in the Philippines and it is one of the very first such experiences in the East Asia and Pacific Region (EAPF).
The key findings and recommendations presented in this report cover three main areas:
1. Financial Inclusion,
2. Financial Capability, and
3. Financial Consumer Protection.
The remaining chapters are structured as follows. Chapter 1 explores the 2 financial inclusion landscape in the Philippines. Chapter 2 gives an overview of Filipinos’ levels of financial capability, in particular about their financial knowledge, attitudes and behaviors. The last chapter investigates if the products which financially included individuals use are effectively meeting their needs.
15 Aug 2015
A macro and micro view of MFI’s compliance to the Code of Conduct
Associations of Microfinance Institutions such as Sa-Dhan and the Microfinance Institutions Network developed a Code of Conduct (CoC) for Microfinance Institutions. They were supported in this effort by the Small Industries Development Bank of India and other institutions, after the Fair Practice Code that had been mandated by the Reserve Bank of India came into existence in 2013. The objective was to create acceptable standards and prescribe expected levels of responsible finance and lending by MFIs.
SIDBI took the responsibility for ensuring that MFIs implemented the Code of Conduct and Fair Practice Code seriously. Ever since SIDBI provided support for the Code of Conduct Assessment (COCA) studies, more than 50 MFIs, big and small, have been assessed and provided with inputs on their current state of play in terms of their compliance with the Code of Conduct and the Fair Practice Code. They have also been given guidance on the way forward. SIDBI commissioned MicroSave to consolidate reports of COCA studies of 50 MFIs done by five rating and evaluation companies. The objectives were to generate learning through insights that were gleaned from the sector, to streamline the future format of COCA reports and to reveal the overall lessons that could be learned from these individual assessments.
This report presents the consolidated findings of the Code of Conduct Assessment reports for 50 MFIs in India. The MFIs represent diverse legal structures and a range of business sizes and scales of operation. The MFIs are also representative of varying geographical presence, as they all varied in their outreach in different states across the country.
The reports have been analysed using a framework built on five key pillars that are critical to the implementation of the Code of Conduct. The five pillars are Integrating Social Value into Operations; Credit Processes and Policies; Human Capital; Transparency and Fairness; and Regulatory Compliance.
29 Jul 2015
Can the world achieve full financial inclusion by 2020? It is an audacious question, but one well worth considering, especially in light of a recent wave of commitments by public and private actors.
Through the Financial Inclusion 2020 project, the Center for Financial Inclusion at Accion (CFI) has been examining this question for several years. In this report, CFI takes a quantitative look at recent progress around the world and makes forward projections to 2020. The headline is that every region, income level, and “slice” of the global population is moving toward greater financial access. According to the World Bank’s Global Findex data, the number of financially excluded people globally dropped from 2.5 billion to 2 billion in the three years from 2011 to 2014. At this rate, by 2020 there will only be about 1 billion excluded adults. With an added push, the World Bank’s goal of universal access to some type of financial account by 2020 seems within reach.
This report steps beyond the headline to ask several probing questions. Who will the excluded be in 2020? Where will they live, and what population groups will they belong to? Will financial access be meaningful for the newly included? Will they use their accounts actively? Will customers deepen savings and borrowing and improve their financial resilience? The report also examines the steps that public and private actors are taking to build a financial inclusion ecosystem. It reveals a level of vibrancy that makes us optimistic about continued or even accelerating momentum.