In a conversation during the last day of European Microfinance Week, Daniel Buchbinder of Guatemala-based Alterna described his NGO’s fee-based support for young entrepreneurs. Upon Alterna’s founding in 2010, its goal was to help its clients’ businesses develop into more stable operations that could qualify for funding. The NGO had served 2,000 firms by 2015, but funders were not investing in many of Alterna’s clients. Hence the NGO launched Catalyzer, a fund that lends small enterprises USD 10,000 to USD 50,000 on a collateral-free basis. Terms range up to five years, and repayments start at 3 percent of revenue and range up to
Category: European Microfinance Week
SPECIAL REPORT: Fintechs vs MFIs – a Debate at European Microfinance Week
At Thursday’s debate on “high-tech” versus “high-touch” financial services at European Microfinance Week, Dorcas Thorpe of Nigeria’s LAPO Microfinance Bank argued that customers in rural areas are more likely to access financial services via high-touch channels such as branches and agents rather than mobile money because they have – on average – lower levels of digital literacy and trust in digital financial services. Gregoire Lecomte of
SPECIAL REPORT: Sounding Alarm Bells on Financial Health: Inclusion Is Not Sufficient
On Friday in Luxembourg, a panel of experts sounded alarm bells on trends in financial health. Amrik Heyer of FSD Kenya noted that financial health in Kenya, for example, has gone down significantly since 2016, the first year for which her data are available. This has occurred while usage of digital financial services (DFS) has gone up.
The panel was adamant that financial inclusion alone does not boost financial health, which encompasses the ability to meet current needs, absorb shocks and pursue financial goals. In fact, Jaspreet Singh of the UN Capital Development Fund argued that
SPECIAL REPORT: Financial Inclusion for Women Requires Engaging All Levels of the Microfinance Institution
During a plenary session on financial inclusion for women at European Microfinance Week 2022, the presenters highlighted the need to collect and use good data. Not only must financial services providers (FSPs) disaggregate data by gender, but they must segment it further, as not all women have the same needs. Mary Ellen Iskenderian of Women’s World Banking cited the example of regulators in Chile realizing their data pointed to a need for housing loans, which the entity then successfully encouraged FSPs to develop.
Carine Roenen of Fonkoze Foundation spoke to the importance of rich data – not just numbers but qualitative data as well. Fonkoze has had success encouraging line staff to report important client experiences to supervisors. For example, when thieves started targeting clients
SPECIAL REPORT: Banco FIE of Bolivia Takes $100k “Financial Inclusion that Works for Women” European Microfinance Award 2022
From the European Microfinance Platform: After a selection process that reviewed applications from 88 organisations, Banco FIE SA has been chosen by the Luxembourg Directorate for Development Cooperation and Humanitarian Affairs to receive the €100,000 European Microfinance Award 2022.
The Bolivian bank captured the High Jury’s attention by incorporating a gender-related dimension into its products and services, in an effort to make them more accessible to women. To do this, it conducted a large number of customer surveys. Banco FIE provides a wide range of products, including micro-insurance (family life insurance and cancer policies), digital financial literacy and technical support to enhance agricultural productivity among women. Within its own organisation, Banco FIE has introduced an innovative business management model called “Marca Magenta” to promote inclusive leadership, the empowerment of women, the prevention of violence and
SPECIAL REPORT: Chamroeun Microfinance Scaling Up to Fund SMEs Supplying Piped Water in Cambodia
Yannick Milev of Cambodia’s Chamroeun Microfinance presented today at European Microfinance Week on the lender’s expansion into providing loans as large as USD 250,000 to private companies that supply piped water to households in Cambodia. In rural parts of the country, the government issues monopolies to private water providers to serve given areas. Approximately 400 companies are licensed to receive these monopolies.
In designing the loan product, Chamroeun employed a technical assistance grant of
SPECIAL REPORT: Solar-powered Onions in Senegal, Meso-insurance Against Storms in Nicaragua, Performance-based Interest Rate Reductions for Climate-smart Lending in India
In a session on strengthening agricultural value chains today at European Microfinance Week, Daphne van Dam of Cordaid described her organization’s work to support onion farmers in Senegal. The farmers were struggling with the cost of fuel for irrigation. Cordaid was able to partner with local microfinance and solar providers to supply farmers with solar-powered irrigation systems that they could pay for on a schedule attuned to the harvest time of their crop.
Magdalena Arbelaez of Incofin described her firm’s work enabling insurance for farmers in Nicaragua. Rather than microinsurance, which would have been unworkable for many of the smallholder farmers in the region, the project extended
SPECIAL REPORT: Enabling Microinsurance via Technology: RFID Tags Slash Fraud, Costs of Livestock Cover in Rwanda
At a well-attended workshop today at European Microfinance Week, Ovia Tuhairwe, the CEO of Radiant Yacu Microinsurance, described her firm’s journey to develop a viable product to insure livestock in Rwanda. On its own, a subsidy of 40 percent from the Rwandan government did not make it easy to insure cattle, pigs and chickens in the country. Before Radiant Yacu moved to its current model in 2019, fraud was rampant, and costs were high at 10 percent of
SPECIAL REPORT: How to Achieve Responsible Digital Financial Services: European Microfinance Week Opens
At the opening plenary of European Microfinance Week, where over 500 attendees are gathering now in-person and online, Tidhar Wald of the UN’s Better Than Cash Alliance noted that over 1 billion more people worldwide have achieved financial inclusion over the past decade. While this has helped some to boost their livelihoods, many have accessed financial services via digital services, which carry different risks than in-person services. Data protection is an obvious example, as more client data is being digitized, and fraud is on the rise. Other risks, even though well-known to providers of in-person financial services, require different
SPECIAL REPORT: e-MFP Green Inclusive and Climate Smart Finance Action Group Focuses on Capacity Building
During the opening day of European Microfinance Week today, roughly 75 members and potential members of the Green Inclusive and Climate Smart Finance Action Group met in-person in Luxembourg – and remotely – to discuss strategies for increasing access to finance that helps people with low incomes to adjust to and reduce climate change. Co-chair Natalia Realpe Carrillo argued, “This is not something extra; this responsible finance!” She went on to describe the Action Group’s work to: publish a glossary of terms for those just getting started in green lending; offer seven related training modules; continue an ongoing webinar series, which is also available on-demand; publish
SPECIAL REPORT: European Microfinance Week Is Almost Here!
European Microfinance Week (EMW) 2022 is fast approaching, and we’re delighted that it will be in-person again, with a hybrid component for remote speakers and participants. EMW2022 offers more than 30 sessions organised across several thematic streams, including “Financial Inclusion that Works for Women” – the topic of the European Microfinance Award 2022 – as well as green and climate-smart finance, digitalisation, funding, financial health, and social performance and impact. Other subject areas include agri-insurance, women’s leadership, fund regulation, mobile money, biodiversity, refugee finance, WASH, food security and more. To give MicroCapital readers a sense of what they can look forward to, here are some details of just three of the EMW2022 thematic streams:
Climate and Green Finance
Climate change represents one of the greatest issues the world faces today. While the changing climate impacts all countries, sectors and people, they are not all affected in the same ways. Climate change is particularly threatening to poor and marginalised communities. Tackling the issue requires battling on many fronts – not just on the mitigation side (minimising the actual climate change that takes place), but on the adaptation side too. The financial inclusion sector has an important role in increasing the resilience of communities most vulnerable to the effects of climate change, and EMW2022 will feature a variety of related sessions, including:
SPECIAL REPORT: Christoph Pausch of e-MFP on European Microfinance Week 2022, Luxembourg & Virtual, November 16-18
MicroCapital: European Microfinance Week (EMW) 2022 will be in-person for the first time in 3 years. What can we expect?
Christoph Pausch (pictured): We’re very excited to be going back to an in-person conference at the beautiful Abbaye de Neumünster in Luxembourg. For the last two years, EMW has been virtual, and we are very proud of how both editions went, but – as I think everyone agrees – an online conference, however professional and comprehensive, can never entirely substitute for meeting in-person. You cannot fully replicate the richness of discussion within a room or the opportunities for exchange, debate and networking that gathering face-to-face allows.
You’ll see some innovations at EMW2022, as we’re taking much of what worked over the last couple of years and incorporating it into the in-person event. Among other things, that means some sessions will be in a hybrid format, so attendees and speakers who cannot come to Luxembourg can take part. Also this year, the conference proper starts on Wednesday at lunchtime, so that our opening will be timezone-suitable for more remote participants.
MC: What range of sessions can attendees choose from?
CP: As always, EMW sessions have been put forward largely by our members and organised across several thematic streams, such as “Financial Inclusion that Works for Women” (the topic of the European Microfinance Award), climate-smart finance, digitalisation and
MICROFINANCE EVENT: European Microfinance Week; November 16-18, 2022; Luxembourg
This annual event is organized with the goal of facilitating networking among various members of the inclusive finance sector. The event program – some of which can be accessed virtually – includes meetings of some
SPECIAL REPORT: Bancamía of Colombia, Banco FIE of Bolivia, Kashf Foundation of Pakistan Shortlisted for $100k European Microfinance Award on Financial Inclusion for Women
From the European Microfinance Platform (e-MFP): On the 21st and 22nd September 2022, the Selection Committee for the European Microfinance Award 2022 (EMA 2022) on “Financial Inclusion that Works for Women” chose the three finalists that will go on to compete for the EUR 100,000 (USD 100,000) prize: Bancamía from Colombia; Banco FIE from Bolivia; and Kashf Foundation from Pakistan.
For decades, financial inclusion has ostensibly been about women’s empowerment and autonomy. But too often the sector has paid only lip-service to what this means, focusing merely on
SPECIAL REPORT: Christoph Pausch on the €100k European Microfinance Award Focusing on Women – Applications Are Open Until April 12
MicroCapital: Why was “Financial Inclusion that Works for Women” chosen as the topic of the 2022 Award?
Christoph Pausch (pictured below): Women ostensibly have been the focus of financial inclusion for decades. But the reality is that a focus on outreach – the number of women clients a financial provider serves – can obscure lack of progress in addressing the many barriers that women face. Increasingly, stakeholders in the sector realise that much more needs to be done, based on a comprehensive understanding of these barriers: including social norms as well as the diverse needs and aspirations of women clients, staff and partners of financial services providers. So, over the months leading up to the launch of this year’s Award, our team has worked with experts to design the guidelines, application forms and assessment criteria to capture what financial providers can do with a gender-focused strategy – not only to
SPECIAL REPORT: “Capital in the Age of COVID” at European Microfinance Week
At this presentation on the effects of the COVID-19 pandemic on financial inclusion, which was subtitled “Navigating the Uncharted Sea of Insolvency,” Lucia Spaggiari of MFR (formerly known as Microfinanza Rating) predicted that the solvency challenges brought on – or simply exacerbated – by the pandemic may haunt institutions for the next 10 years. Although she described the solvency challenges of 2020 as “not drastic,” 22 percent of financial services providers (FSPs) in her dataset still significant solvency risk. Ms Spaggiari believes this may increase to as high as 34 percent over the next two years.
As for the potential effects on clients, there are clusters of greater risk among: FSPs in sub-Saharan Africa, where 17 percent of institutions are in danger; smaller FSPs, those with assets under USD 10 million; FSPs with
SPECIAL REPORT: Aligning Incentives, Setting Realistic Expectations for FSPs’ Outcomes Measurement at the e-MFP Investors Action Group
During European Microfinance Week last week, Célia Fernandez of the French NGO Comité d’Echange, de Réflexion et sur les Systèmes d’Epargne-Crédit (CERISE) described LabODD, a project to help mission-driven organizations measure their progress toward the UN Sustainable Development Goals (SDGs). LabODD is a four-year project funded by the French government’s Agence Francaise de Developpement. Among its outputs is a brief due out in December 2021 that will cover outcomes management for financial services providers (FSPs). Cécile Lapenu, also of CERISE, described several trends that will be presented in the brief.
The demand of impact investors for accountability from FSPs is growing. However, the focus now is more on measuring outcomes – which can be associated plausibly with the work of FSPs – rather than impacts – which must be shown to result from
SPECIAL REPORT: Networks in Nigeria, Latin America & Caribbean Boost Trajectory of Women Staff, Clients of Microfinance Institutions (MFIs)
At a session titled “Professional Women’s Networks and Women’s Leadership in Financial Inclusion,” Mariana Martinez of FinEquity, a platform hosted by CGAP that promotes women’s financial inclusion, described the platform’s new Spanish-language arm, FinEquityALC. FinEquityALC focuses on Latin America and the Caribbean, serving as a pilot project that could lead to FinEquity establishing other regional projects. The goals of FinEquityALC are to improve public policy that impacts women’s financial inclusion as well as financial products and financial education that are targeted at women. Its 1,100 users span 250 institutions.
Barbara Magnoni of Andares and EA Consultants described how Andares connects