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How Microfinance Institutions Can Manage Default Risk AND Build Financial Inclusion
High client growth and low default rates are typical benchmarks for gauging the success of MFIs. But the two measures can be counterproductive for MFIs looking to achieve real social impact through financial inclusion. Achieving low default rates and higher client growth rates together is only possible when the client’s cash flows are more than adequate to cover the average loan size.
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Insights from G2012 Mexico Financial Inclusion Twitter Conference
Great insights and knowledge surfaced about how to provide valuable, affordable, secure, and comprehensive financial services to underserved and excluded communities during a six-hour long multilingual #SocEntChat on Twitter last month. It was part of the G2012 Mexico Financial Inclusion global competition that is seeking the world’s most innovative solutions for financial inclusion, organized by Ashoka Changemakers and G2012 Mexico. Don’t worry if you missed it, here’s a recap.
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Rural banks partner with telcos to boost microfinance
Rural banks will soon have their own set of “killer apps” to better compete with bigger banks and, more importantly, expand their microfinance services in the Philippines.
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- Technology
- Region
- Asia Pacific
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NexThought Monday: Designing New Financial Products for ‘Bolsa Familia’ Beneficiaries: CGAP’s research explores how conditional cash transfer recipients manage money
We at CGAP have been involved in efforts in Brazil to improve our understanding of Bolsa Família recipients. Our goal is to counteract the prevailing wisdom held by banks in Brazil that welfare recipients are a singular block of very poor people to whom it is difficult to provide financial services.
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The Secret of Africa’s Banking Boom: Mobility
While U.S. and European banks suffer hangovers from the Great Recession and continued shock waves inside the eurozone, Africa’s top lenders have never looked stronger or been more ambitious. Why is a continent better known for political instability and foreign aid riding a banking boom characterized by aggressive pan-African expansion and swelling balance sheets?
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- Region
- Sub-Saharan Africa
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With Business Training, Lenders Stitch Kashmir’s Private Sector Back Together
Young business people in Kashmir often find processes slow, corrupt and inefficient, leaving them disillusioned and leading them to give up. But local government is taking steps to streamline the registration process, and providing support to young entrepreneurs through its Entrepreneur Development Institute. J&K Bank has partnered with the local government and Mercy Corps to develop a "Youth Start-Up Loan Scheme" at a competitive interest rate and worth up to 35 percent of the project’s costs.
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New Data Reveals Massive (Potential) Mobile Money Market for the Poor : Across Africa millions are sending huge volumes of domestic remittances – mostly in cash
A few months back I wrote this quick piece highlighting some preliminary findings from data that was just coming in from a major study the Gallup organization did for us.
Now, the full data set is in and the results are quite interesting.
In collaboration with Gallup, we surveyed 11 countries in Africa (including Kenya) on the payment habits of the adult population. To my knowledge, this is the largest study of its kind – tracking money transfer and payment behavior in the developing world.- Categories
- Education, Technology
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Don’t Touch Our M-PESA!: In Mobile Money, Why Even Sacred Cows Need Scrutiny
I was giving a presentation on the potential of branchless and in particular mobile banking at an international forum, and apparently I upset the Kenyans in attendance for not having lavished enough praise on M-PESA. When I talk about mobile banking I generally use the example of M-PESA because there are few others that are really worth talking about at this point (sadly), and I mostly get “enough with that already” kind of looks. So this was new.
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