by the MicroCapital Team -

SPECIAL REPORT: Are MFIs Making Child Labor Worse? Willing to Test a Risk-assessment Prototype? How Can Schools Boost Child Protection? Why Buy Disposable Sanitary Pads When You Can Sew Reusable Ones?

DuringEuropean Microfinance Platform Thursday’s “Risky Business” session at European Microfinance Week, Patricia Richter of the UN’s International Labour Organization (ILO) led the audience through a poll of audience members’ personal work histories and how they think microfinance institutions (MFIs) can help reduce child labor. The audience voted that MFIs should do more to “raise awareness among clients and households” about the issue. The ILO’s Minimum Age Convention of 1973, which has been ratified by 172 countries, specifies the youngest acceptable ages for various types of work, ranging from 12 years old for fewer hours of light work in developing countries to 18 years old for hazardous work in any country.

The motivations for adults to engage children in age-inappropriate work include: (1) the family’s need for more income; (2) social norms that encourage child labor or the passing down of skills from parents to young children; (3) insufficient educational opportunities; (4) market demand for

by the MicroCapital Team -

SPECIAL REPORT: APA Insurance of Kenya Wins $110k European Microfinance Award for Index-based Livestock, Crop Products

From the European Microfinance Platform:
APA Insurance Ltd receives the 10th European Microfinance Award in recognition of its response to “Strengthening Resilience to Climate Change”

Photo © European Microfinance Award StudioEuropean Microfinance Award winner 2019

At a ceremony held at the European Investment Bank in Luxembourg, Paulette Lenert, Luxembourg Minister for Cooperation and Humanitarian Affairs, presented the 10th European Microfinance Award to APA Insurance Ltd of Kenya.

Since 2006, Luxembourg Directorate for Development Cooperation and Humanitarian Affairs, the European Microfinance Platform and the Inclusive Finance Network Luxembourg have been awarding a EUR 100,000 (USD 110,000) prize to the winner and, starting two years ago, EUR 10,000 (USD 11,000) to the two finalists.

This year’s winner, APA Insurance Ltd, is a Kenyan insurance company that provides

by the MicroCapital Team -

SPECIAL REPORT: Sibling Rivalry, Pre-disaster Microinsurance Payments, Protecting Climate-displaced People via International Law at European Microfinance Week

At European Microfinance Platformtoday’s opening plenary of European Microfinance Week, Manuel Tonnar, who leads Luxembourg’s Directorate for Development Cooperation and Humanitarian Affairs, said that his country “is committed to transforming itself and helping others transform their economies into sustainable economies.” This is “not for charitable reasons,” he argued, “but because it’s the most efficient way” to move forward. Mr Tonnar also said, “Financial inclusion should be closely allied with other development interventions to provide the most value to disadvantaged populations.” In closing, he quoted Jean Monnet, who said, “I am not optimistic. I am not pessimistic. I am

by the MicroCapital Team -

SPECIAL REPORT: MFR Launching Atlas Platform to Unify Data on Financial Performance, Social Performance, Pricing, Client Protection: a Preview at European Microfinance Week

Today, on European Microfinance Platformthe opening day of European Microfinance Week in Luxembourg, Lucia Spaggiari and Aldo Moauro of MicroFinanza Rating (MFR) described Atlas, a platform for collecting and analyzing data on microfinance. Atlas offers data on financial performance, social performance, pricing and client protection. The data sources include a range of data types from MFR, as well as pricing data from the now-closed NGO MicroFinance Transparency. These cover about 550 financial services providers (FSPs), including microbanks, financial technology (fintech) lenders, and

by the MicroCapital Team -

MICROCAPITAL BRIEF: Motorcycle Taxi Leasing Company Tugende of Uganda Raises $13m, Looks to Expand Its Boda-boda Finance to Kenya

Uganda’s Tugende, which specializes in leases for motorcycle taxis known as boda-bodas, recently raised USD 13 million from undisclosed sources with the support of Verdant Capital. Of this total, USD 2 million has been disbursed so far. Tugende has 14,000 active leases and a loan book of USD 13.7 million as of September 2019, up four-fold since January 2018. Its 30-day portfolio-at-risk ratio remains below 1 percent, and Verdant calls the firm “robustly profitable.”

Tugende, which translates as “let’s go,” has 16 branches in Uganda and recently received a license to

by the MicroCapital Team -

SPECIAL REPORT: Partnerships, Patience, Sizing Goals for Hummingbirds to Meet SDGs Via Financial Inclusion, Complimentary Services

“We SAM 2019need to develop services with added value to increase impact,” said Corinne Molitor of ADA during the first Wednesday plenary session at SAM. In the absence of non-financial services, financial inclusion does not lead directly to reduced poverty. To find evidence of poverty alleviation, she says, we must consider the long term because reducing poverty is a very slow process. Mathieu Ciowela of the UN Development Program said of the Sustainable Development Goals (SDGs) that, “We have been implementing this for four years. Maybe in 10 years we’ll have data on progress.”

Adrian Kamenitzer of the European Investment Bank also spoke in terms of decades rather than years. He told a personal story of growing up in Romania and observing the transition from communism. “In 1990, we had a new regime. We had hopes,

by the MicroCapital Team -

SPECIAL REPORT: Diffusing Excuses for Failing to Measure Microfinance Institutions’ Social Performance

Amelia SAM 2019Greenberg of the Social Performance Task Force (SPTF), at a SAM session on measuring social impact, reviewed some of the excuses microfinance institution leaders use to postpone measuring client outcomes. Some say satisfaction surveys are sufficient, or they feel a robust process will be too expensive. Some worry that it is unreasonable to claim a cause-effect relationship between their institution’s financial services and changes in clients’ lives.

Colin Rice of South Africa’s Small Enterprise Foundation (SEF) argued that it is valuable to start by measuring just a few parameters that the organization is already tracking. Monitoring the amount that clients save over time is a prime example. It is easy to

by the MicroCapital Team -

SPECIAL REPORT: Fostering Economic Resilience in the Face of Climate Change with Microinsurance, Savings, Investments in Agriculture

Dan SAM 2019Zook of ISF Advisors opened the SAM session on “Fostering Economic Resilience in the Face of Climate Change” arguing that smallholder farmers are the “number one most vulnerable in the world to climate change…so it’s important that we talk about adaptation financing.” A survey by CGAP segments the needs of farmers as follows: (1) subsistence farmers are the poorest and most vulnerable; they need savings and insurance; (2) commercial farmers that sell cash crops can benefit from investments such as drip irrigation; and (3) larger-scale farmers need to think about adaptation as well as how to reduce their own environmental impact. Although agriculture is the source of a quarter of greenhouse gas emissions worldwide, Mr Zook said, smallholders have minimal environmental impact, except in the case of those raising a few particularly resource-intensive crops.

Yann Groeger of BlueOrchard cited his firm’s InsuResilience Investment Fund, which works with insurers to

by the MicroCapital Team -

SPECIAL REPORT: Climate-change Resilience Takes Centre Stage at European Microfinance Week 2019

AsEuropean Microfinance Platform a proud co-organiser of the EUR 100,000 European Microfinance Award (EMA), e-MFP leverages European Microfinance Week to spot-light the theme of the Award each year. With EMA 2019 focused on Strengthening Resilience to Climate Change, the many ways that financial inclusion stakeholders are helping vulnerable populations adapt to climate change are at the forefront of the European Micro­finance Week programme. If your work involves addressing climate change through financial inclusion, #EMW2019 is not to be missed!

The opening plenary, titled Strengthening Resilience to Climate Change, features the three finalists for EMA 2019:

by Jolene Khor -

MICROFINANCE PAPER WRAP-UP: “Microfinance Barometer 2019,” Published by Convergences

Published by Convergences in partnership with the Advans Group, BNP Paribas, the European Microfinance Platform (e-MFP) and the Grameen Credit Agricole Foundation; October 2019; 16 pages; available at http://www.convergences.org/en/104906-2/

This tenth edition of the “Microfinance Barometer” offers insights into the microfinance sector garnered through interviews, case studies and a review of data from the Microfinance Information Exchange (MIX). The publication explores trends in the sector over

by the MicroCapital Team -

SPECIAL REPORT: Sébastien Boyé of I&P on Microfinance Institutions Digitalizing for SMEs, Taking on “Aggressive New Actors” in Africa

At SAM 2019last week’s SAM conference, Sébastien Boyé, the Chief Investment Officer of Investisseurs & Partenaires, delivered a keynote address on the future of financial inclusion in Africa. Mr Boyé expressed optimism about Africa’s future because of the continent’s dynamism and entrepreneurial spirit. He cited forecasts that by 2050, 250 million new jobs will be created in Africa as the continent’s GDP overtakes that of the EU. In terms of weaknesses, there is significant volatility, and several countries are getting into trouble with too much public borrowing.

Mr Boyé argues that stakeholders in the financial inclusion sector need to focus on topics such as human resources, academic research and digitalization. When it comes to digitalization, institutions must look to

by the MicroCapital Team -

SPECIAL REPORT: At SAM, Meeting the SDGs by Decreasing Hunger, Increasing Digital Access, Embracing Change to Modernize Microfinance in Africa

On SAM 2019the second day of this week’s SAM conference in Burkina Faso, Mathieu Soglonou of the UN Capital Development Fund commented on several of the UN’s Sustainable Development Goals (SDGs) in a session on the “State of the Inclusive Finance Sector and Its Contributions to Development in Africa.” Despite general progress toward the SDGs, Mr Soglonou noted that there have been setbacks in SDG 2, “Zero Hunger.” The number of people living with hunger has increased by 800 million due to problems such as extreme weather, war, and difficulties with the storage and distribution of agricultural products. Mr Soglonou noted that one challenge in reducing hunger is that lenders tend to

by Jolene Khor -

MICROFINANCE PAPER WRAP-UP: “Making Digital Credit Truly Responsible: Insights From Analysis of Digital Credit in Kenya;” published by MicroSave Consulting, SPTF, Smart Campaign, AFD

Published by MicroSave Consulting, the Social Performance Task Force, the Smart Campaign and Agence Française de Développement; September 2019; 103 pages; available at https://www.microsave.net/wp-content/uploads/2019/09/Digital-Credit-Kenya-Final-report.pdf

This report draws on first-hand data, secondary research and the use of data analytics to provide insights into the Kenyan digital credit sector from the perspectives of both customers and suppliers of digital credit. The authors highlight advances that have been

by Anna Gravois -

MICROCAPITAL BRIEF: Accion’s CFI to Hold 5th Annual Financial Inclusion Week; October 21-25, 2019

The Center for Financial Inclusion, an initiative of the US-based NGO Accion, will hold the fifth iteration of its Financial Inclusion Week (FIW) beginning on October 21. Last year’s FIW connected 160 partners with

by Anna Gravois -

MICROCAPITAL BRIEF: EBRD, EU Commit $132m to EU4Business Initiative for Financing SMEs via OTP Bank Ukraine, ProCredit Bank Ukraine, Raiffeisen Bank Aval

The UK-based European Bank for Reconstruction and Development (EBRD) and the EU recently committed EUR 120 million (USD 132 million) to implement the EU4Business Initiative in Ukraine. Through the program, EBRD will provide local banks with

by the MicroCapital Team -

MICROFINANCE EVENT: European Microfinance Week; November 20-22, 2019; Luxembourg

ThisEuropean Microfinance Platform event opens with a day of meetings on various topics, including the Human Capacity Development Action Group and the Green Inclusive & Climate Smart Finance Action Group. The following two days include sessions such as “Strengthening Resilience to Climate Change Through Financial Inclusion,” “Protecting the Working Poor in the 21st Century Through Responsible Finance” and “Responsible