MICROFINANCE PUBLICATION ROUND-UP: Poverty Scorecard for Nicaragua, Financial Inclusion in Russia, Health Microinsurance in India

“A Simple Poverty Scorecard for Nicaragua;” by Mark Schreiner; January 2013; 189 pages; available at http://www.microfinance.com/English/Papers/Scoring_Poverty_Nicaragua_2009_EN.pdf

This document introduces an “easy-to-use” poverty scorecard based on household expenditure data from Nicaragua’s 2009 Living Standards Measurement Survey. Using easily verifiable data, the poverty scorecard can be used to estimate the likelihood that a household has expenditures below a given poverty line, the poverty rate of a group of households at a specific point in time and changes in the poverty rate of a group over time. Despite its derivation from complex statistical measures, the author notes that the scorecard is designed to be understood by non-specialists and “practical for local pro-poor organizations that want to improve how they monitor and manage their social performance.”

“Landscaping Report: Financial Inclusion in Russia;” by Timothy Lyman, Stefan Staschen and Olga Tomilova; published by CGAP (Consultative Group to Assist the Poor); January 2013; 63 pages; available at http://cgap.org/publications/landscaping-report-financial-inclusion-russia

This report presents an analysis of the accelerating change in the financial inclusion landscape for lower income Russian citizens in the years since 2007. The authors find that while the number, size and diversity of retail credit providers have increased “dramatically”, residents of smaller cities and rural areas have limited access to safe, high-quality financial services and are challenged by distrust in financial institutions, poor financial literacy, low-income levels and supply side-constraints. Between 2008 and 2011, billions of rubles were transferred from the state-owned Russian Small and Medium Entrepreneurship Support Bank (SME Bank, formally the Russian Development Bank) to microfinance institutions (MFIs) and credit cooperatives, helping reduce the portion of the population not using banking services from approximately 48 percent to 22 percent. As rapid credit market development “has sometimes resulted in a lag between the introduction of questionable or unacceptable market practices and a regulatory response,” the report cites the need for specialized consumer protection agencies, growth of credit bureaus, finer-scale data to “understand why banks and non-bank credit organizations are not realizing their financial inclusion potential,” and more partnerships among e-money operators, banks and mobile network operators.

“Value-Added Services in Health Microinsurance;” by John Pott and Jeanna Holtz; published by The International Labour Organization (ILO); 2013; 37 pages; available at http://www.ilo.org/public/english/employment/mifacility/download/mpaper19_services.pdf

This report examines the benefits and challenges of value-added services (VAS) in health microinsurance (HMI) in India. The authors argue that VAS provided by HMI practitioners can enhance the appeal of basic health insurance products to clients while offsetting the incremental costs to practitioners through increased sales and reduced claims. This is important to low-income households because they are often pushed into poverty by health expenditures. The authors highlight Dial-a-Doctor, a service that allows rural households to resolve health-care needs with a consultation via telephone, thus reducing out-patient expenditures. This service is deemed the “most viable” of VAS presently implemented. The report also explores preventative VAS such as health education, which the authors consider “reasonably inexpensive to provide” and having the potential to “substantially reduce overall claims costs.” Such VAS can alleviate challenges including perceived lack of tangible or immediate benefits on the part of clients, delayed behavioral changes and health outcomes, high out-of-pocket client costs and disconnects among products offered, affordability and client needs. The authors conclude that “VAS in HMI should be further explored as they promise to… promote better health risk management decisions and better health practices,” and will in turn result in less out-patient expenditure and a more favorable business case for in-patient HMI through fewer claims and high renewal rates.

By Sam Allmendinger, Research Associate

Sources and Additional Resources:

“A Simple Poverty Scorecard for Nicaragua,”
http://www.microfinance.com/English/Papers/Scoring_Poverty_Nicaragua_2009_EN.pdf

“Landscaping Report: Financial Inclusion in Russia,”
http://cgap.org/publications/landscaping-report-financial-inclusion-russia

“Value-Added Services in Health Microinsurance,”
http://www.ilo.org/public/english/employment/mifacility/download/mpaper19_services.pdf

MicroCapital Universe Profile: CGAP (Consultative Group to Assist the Poor)
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=CGAP+%28Consultative+Group+to+Assist+the+Poor%29

MicroCapital Universe Profile: International Labour Organization (ILO)
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=International+Labour+Organization+%28ILO%29

MicroCapital. April 10, 2012, “MICROFINANCE PUBLICATION ROUND-UP: Microinsurance and Child Labor; Benin Poverty Scorecard; Effect of Recession on Microcredit Sector,” https://www.microcapital.org/microfinance-publication-round-up-microinsurance-and-child-labor-benin-poverty-scorecard-effect-of-recession-on-microcredit-sector/

MicroCapital. February 7, 2012, “MICROFINANCE PUBLICATION ROUND-UP: Poverty Scorecard for Afghanistan, Implementing Microfinance Information Systems, Improving Client Value from Microinsurance,” https://www.microcapital.org/microfinance-publication-round-up-poverty-scorecard-for-afghanistan-implementing-microfinance-information-systems-improving-client-value-from-microinsurance/

MicroCapital. March 7, 2013, “MICROFINANCE PUBLICATON ROUND-UP: The Business Case for Life Microinsurance in the Philippines, MIX Map of Financial Inclusion in India, 2012 Sub-Saharan Africa Snapshot,” https://www.microcapital.org/microfinance-publicaton-round-up-the-business-case-for-life-microinsurance-in-the-philippines-mix-map-of-financial-inclusion-in-india-2012-sub-saharan-africa-snapshot-2/

MicroCapital. March 23, 2013, “MICROFINANCE PAPER WRAP-UP: “Pathways Towards Greater Impact: Better Microinsurance Models, Products and Processes for MFIs;” by Craig Churchill, Aparna Dalal and Josh Ling; published by International Labour Organization, Microinsurance Innovation Facility,” https://www.microcapital.org/microfinance-paper-wrap-up-pathways-towards-greater-impact-better-microinsurance-models-products-and-processes-for-mfis-by-craig-churchill-aparna-dalal-and-josh-ling-published/

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