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Going the Extra Mile: From Safety Nets to Pathways out of Poverty
Track: Partnerships Targeting the Vulnerable
Date: Thursday, October 10th
Time: 9:00 – 10:30 AM
Partnerships between financial institutions, governments, and social welfare programs are essential for empowering the extreme poor reduce vulnerability and gain self-sufficiency. Moderating the 2013 Partnerships against Poverty Summit plenary session “Going the Extra Mile: From Safety Nets to Pathways out of Poverty,” Roshaneh Zafar of the Kashf Foundation (Pakistan) noted that “poverty is a complex matter. We need multiple solutions, we need synergy, we need leverageability, we need scalability; and we all need to work together and do much more.”
The discussion opened with Department of Social Welfare and Development (DSWD) of the Philippines Secretary Corazon “Dinky” Juliano-Soliman, who told of their “convergence strategy,” a means to help beneficiaries graduate and stay out poverty through conditional cash transfer (CCT) community-driven development and sustainable livelihoods converging. Through this program, they also partner with microfinance institutions to provide credit to clients that need larger loans than DSWD provides (10,000 pesos, or approximately $230).
Juan Borga of the Inter-American Development Bank shared their efforts toward poverty reduction. Working mostly with conditional cash transfer (CCT) programs, they are trying to create a system that creates a relationship between the recipients of the CCTs to the financial institutions so that they will have “the right instruments [to save] and the right incentives to do it.” Commonly, “the financial institutions are not really providing them with the right products they’d like to have.”
Nelly Otieno of CARE International in Kenya and Yves Moury of Fundación Capital (Colombia) highlighted the necessity of building assets through methods such as savings groups and CCTs in order to create pathways out of poverty and to prevent long term dependence on financial programs.
Moury, in particular, stressed the importance of asset building and capacity building as a catalyst to spur sustainability and self-sufficiency–and thus an exit strategy for the implementers. According to Moury, “Linking savings and CCTs has been just like putting wheels on suitcases—a powerful combination.”
The speakers agreed that health insurance, mobile phones, identification cards, social protection, and bank accounts, working in tandem, greatly help to supplement financial inclusion initiatives and create pathways out of poverty.
Syed Hashemi of BRAC Development Institute (Bangladesh) spoke about incorporating governments into exit strategies that allow clients to protect their assets and take advantage of new opportunities. He emphasized that, “through national governments, we can come up with an integrated, holistic, national social protection system that combines CCTs with graduation programs so we can collectively achieve this commitment of eradicating extreme poverty by 2030.”
Hashemi also touched on the cost-effectiveness of social protection policies that include safety nets and offer self-employment because, although graduation programs that include extremely intense monitoring and coaching have been seen to have an initially higher cost, they require a shorter timeline.
Innovative methods of providing health services to the poor are equally crucial to comprehensively reducing the amount of individuals living in extreme poverty. Chandra Shekhar Ghosh of Bandhan (India) stated, “Poverty is a complex syndrome. It is not only possible to eliminate poverty through credit support to the poor.”
Organizations and government institutions working toward eliminating poverty must implement additional services beyond credit, including social, health, and educational programs that target the underlying causes of poverty beyond financial inclusion.
Overall, the plenary constructively critiqued the current successes, challenges, and future opportunities in the effort to create the pathways the extreme poor can take advantage of to lift themselves out of poverty.
However, the speakers recognized that the road ahead is difficult. As Secretary Soliman stated, “We hesitate to say graduation or exit because poverty is very complex. The notion of graduation gives the impression that we are done. But with poverty you can never be done, and that’s why we call it transition.“
Watch the full video of this plenary
Building the Ecosystem for Financial Inclusion while Protecting Clients
Track: Partnerships Building a National Ecosystem
Date: Wednesday, October 9th
Time: 2:30 – 4:00 PM
Artfully moderated by Dr. Sipho Moyo of the ONE Campaign, the plenary session “Building the Ecosystem for Financial Inclusion while Protecting Clients” at the 2013 Partnerships against Poverty Summit highlighted the advancement of the Maya Declaration in select developing countries.
The Maya Declaration, the first of its kind, is a commitment by developing countries to make significant progress in financial inclusion. This plenary session showcased the progress the Philippines, India, and Bangladesh have made thus far and the role policy makers play in bringing about full financial inclusion.
Sung-Ah Lee of the Alliance for Financial Inclusion kicked off the plenary session by giving the current empirical evidence on the status of financial inclusion globally as well as the evidence of the contributions this inclusion makes towards poverty alleviation and business sector stimulation.
After presenting the data and evidence, Lee moved to expressing how policy plays a key role in catalyzing full financial inclusion. The policy environment not only creates avenues for access to financial services by the poor, but also creates favorable environments for microfinance providers to expand their services. Rather than leaving the sector to market forces, regulation is advocated to not only give confidence and security in the business but can also mitigate risks in the sector such as over-indebtedness.
Lee gives us much hope for the future, as she closed her statements with a note on holding countries to their commitments in reaching the poorest with financial services, a feat that cannot be achieved without effective partners and collaborators. In this way, the Maya Declaration can become a reality.
Dr. B.S. Suran of the National Bank for Agriculture and Rural Development in India presented a moral argument for financial inclusion—that it has been proven to better clients’ standard of living. He spoke about financial inclusion creating social change, touching on the importance of providing financial literacy training. While financial literacy education may change the way the poor interact with the financial world, he argued it may also change the way the poor interact with the rest of society. “We need financial inclusion in a place like India that is very socially stratified.”
The presentation was then turned over to Pia Roman-Tayag of the Central Bank of the Philippines, who introduced some hard hitting points about the geography of this problem as well as some possible solutions.
Building on Dr. Suran’s argument about stratification was Tayag’s data on the geographic stratification of banking institutions; in the Philippines, as in many nations, they are the most concentrated in urban areas. This is especially an issue where physical infrastructure is underdeveloped, but there is a solution to the limited access points: mobile technology.
Tayag told the assembly that even though 15% of the Filipino population does not have access to financial services, the mobile phone penetration rate is 140%, meaning that most of the rural poor can feasibly start savings accounts and even gain access to credit. Innovations such as mobile technology can catalyze low cost solutions to bringing about full financial inclusion. This is especially pertinent to Tayag as she insisted that financial inclusion means “access for all.” (Learn more about mobile technology.)
Finally, Abdul Karim of Palli Karma-Sahayak Foundation, brought forth the evidence of financial inclusion in Bangladesh and their success of having achieved the 2nd highest rating of access to financial services in South Asia.
Karim emphasized the importance of serving clients in agriculture, the source of many poor family livelihoods, with not only financial services but also capacity building for both the farmers and the institutions serving these small agriculturalists. They face unique challenges and thus have unique opportunities to service this cohort.
With initiatives such as the Maya Declaration, countries are working together to provide favorable policy and regulatory environments that can achieve the goal of full financial inclusion and poverty alleviation. Using these high-level partnerships and sharing best practices, countries not only can provide the favorable environment to the sector’s development but also shield clients from harmful practices and over-indebtedness by implementing accountability and regulatory structures.
Dr. Moyo concluded the plenary session by stating that “financial inclusion is an idea whose time is now.”
Watch the full video of this plenary
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Partnerships against Poverty: Why, When, & How to Partner
Date: Wednesday, October 9th
Time: 11:30 – 1:00 PM
Effective partnerships generate synergies between organizations that each supply unique skills, perspectives and resources to devise new ways of approaching old challenges, providing needed products and services on a much wider scale.
The plenary “Partnerships against Poverty: When, Why and How to Partner” centered on the guiding principle for the 2013 Partnerships against Poverty Summit, exploring the manner in which partnerships can be developed, negotiated, leveraged, and managed between actors that come from different sectors while highlighting some of the best practices in the field. This cornerstone session set up the framework for the rest of the Summit agenda to follow.
Nicholas Luff of The Partnering Initiative, serving as the session’s moderator and multi-stakeholder partnership builder, began the session by stressing the characteristics of good partnerships.
He described these strategic relationships as an “engaging two-way dialogue, which moves beyond mere contractual interactions towards transformative missions among value-adding knowledge sharers.” Collaborations founded in this spirit hold great potential for catalyzing the next wave of movement out of extreme poverty.
Rodger Voorhies, director of the Financial Services for the Poor Initiative at the Bill & Melinda Gates Foundation emphasized the dire need for cutting-edge partnerships in the financial inclusion field. He stressed that “2.5 billion people are currently left out of access to financial services.”
In order to combat this trend, Voorhies advised that “we need to substantially increase access and that will require new kinds of partnerships, new kinds of innovation and new kinds of thinking…We are at the forefront—at a cusp—of rattling changes using technology and new ways of delivering services.” Voorhies discussed the potential of digital services coupled with transformative partnerships to form the next great paradigm shift in helping practitioners reach into untapped communities and leverage their impact.
Bringing a concrete example of a successful cross-sector partnership, Richard Leftley, CEO of MicroEnsure, engaged the audience by showcasing his own company’s collaboration with mobile service providers, which facilitated an expansion of MicroEnsure’s client base.
Leftley summarized the process that MicroEnsure underwent in its quest for a fruitful partnership, describing the challenges associated with being a small, young company and providing a product (i.e., microinsurance) that at the time was relatively unknown. He echoed Luff by pointing out that “a shared sense of necessity where each partner brings something to the table” is vital in developing and negotiating successful relationships with other actors.
Watch the full video of this plenary
On the whole, the plenary displayed a clear sense of optimism for the road ahead by highlighting the manner in which partnerships can create opportunities for people living in poverty where no single actor could provide the multitude of services needed by the poor on their own. Each of the speakers acknowledged that opportunities for collaboration are widening and stakeholder engagement is at an all-time high, making it a perfect time to engage in deep dialogue and work together on the collective mission to eradicate extreme poverty in the near future.
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Date: Wednesday, October 9th
Time: 9:30 – 11:00 AM
“Together we can achieve an important milestone in human history. A world that is free—truly free—from extreme poverty,” said World Bank President Jim Yong Kim in the opening session of the 2013 Microcredit Summit: Partnerships against Poverty. In a pre-recorded statement, Dr. Kim urged the more than 850 delegates from 71 countries to commit themselves to making microfinance a key tool in the movement to end extreme poverty.
Watch Dr. Kim’s statement
The World Bank’s two new goals to end extreme poverty by the year 2030 and to increase the incomes of the poorest 40 percent “are now the central purpose and moral underpinnings of our institution,” explained Dr. Kim.
“To achieve this bold vision, all of us will have to work together, including civil society, as well as our public and private sector partners. The many organizations involved in the Microcredit Summit Campaign and the 100 Million Project are making important contributions to these goals…”
This became the guiding theme for our three-day Summit. Through plenary presentations and workshop discussions, participants explored how, through partnerships, technology and innovation, microfinance could do a better job of reaching those living in extreme poverty and facilitating their movement out of poverty.
Central Bank of the Philippines Governor Amando Tetangco, Jr., Budget Secretary Florencio “Butch” Abad, and Indonesian Minister of Cooperatives and SMEs Syarifuddin Hasan joined Dr. Kim’s call for financial services providers to reach the excluded with products and services that enabled them to build resilience and take advantage of opportunities. (Watch the video of this part of the Opening Ceremony here.)
After the shared anecdotes of successful Filipino clients of microfinance, Professor Muhammad Yunus wrapped up the opening session to the Summit, joining his colleagues in imploring for financial inclusion across the globe. “Nobody should be outside the financial services.” Professor Yunus continued his interview discussing the importance of partnerships, and how by working together, and learning from each other, the World Bank’s goal of ridding the world of extreme poverty by 2030 will continue to present itself as one that is attainable.
Watch the the interview of Professor Yunus
The statements of dedication to existing and new partnerships against poverty from the many high-level presenters during the opening session of the Summit set forth a strong foundation for the engaging and action-oriented sessions that followed. They also put forth the platform on which delegates could form Campaign Commitments to helping 100 million families lift themselves out of severe poverty—and thereby make a dramatic step forward in doing our part as an industry to support reaching the World Bank’s goal for 2030. Learn more about the Microcredit Summit Campaign’s new initiative, Campaign Commitments, here.
Watch the full video of the Opening Ceremony
In the mid-1970s, Professor Muhammad Yunus launched microfinance movement, starting with just $27 out of his own pocket he loaned to 42 poor weavers and merchants in Bangladesh. Today, Grameen Bank has grown to nearly 8.4 million members—nearly 97 percent of whom are women—and has lent over $12.5 billion, allowing millions of women and their families the opportunity to lift themselves out of severe poverty. Furthermore, ownership and leadership of this great institution lies in the hands of its women borrowers as 97 percent of its shareholders and 9 of 13 members of the board of directors are women borrowers. Its groundbreaking model has now been replicated in almost all countries around the world and has influenced the work of Summit delegates here today and Campaign members around the world, becoming a highly regarded institution in its nearly 40 years of operation.
Since 2010, the government of Bangladesh has threatened to take control of the bank. This move would undermine Grameen Bank’s longtime success, disenfranchise the women who own a majority of the shares—and, by virtue of that, a majority of its board seats—and even the independence of civil society throughout the country and microfinance institutions around the world. At the 2013 Partnerships against Poverty Summit just held in Manila, Philippines, Microcredit Summit Campaign Director Larry Reed called on delegates to endorse the following declaration of support for the beleaguered institution.
As delegates of the Microcredit Summit Campaign’s 2013 Partnerships against Poverty Summit, we voice our support for the continued independence of Grameen Bank and continued enfranchisement of the women who are the Bank’s clients and owners. It is imperative that the Grameen Bank Ordinance not be changed any further and that recent amendments be rescinded. This includes ensuring that the borrowers retain control of the bank and that the existing election process of the Board of Directors continue. We will continue to track this issue closely and remain vigilant in our support of Grameen Bank’s independence.
As delegates of this Summit, we are working together to guarantee that microfinance remains a tool that can be used by people in poverty to improve their lives and provide a pathway out of poverty. The takeover of an institution so admired as Grameen Bank is threat to all of us. The independence and integrity of microfinance and all of our institutions must be protected. Thus, it is our duty to speak out in solidarity with the women borrowers of Grameen Bank who, through their hard work, investments, and ownership of this bank, have empowered themselves and transformed the lives of their families. This threat to Grameen Bank is a threat to the progress of the microfinance sector not only in Bangladesh, but around the world.
More than 800 delegates, representing 145 institutions and 71 countries from every continent save Antarctica were present for the reading of this declaration. All were credited for their work to end extreme poverty and create economic opportunity for people worldwide. The declaration was met with a standing ovation from delegates in a resound display of support and adoption of the statement by the 2013 Partnerships against Poverty Summit.
The third and final day of our Summit was just as eventful and exciting as the first two. The day started off with the “Social Business: Creating solutions for social problems” plenary, moderated by Imelda Nicolas, Secretary of the Commission on Filipinos Overseas (CFO), Philippines. The Panelists included the esteemed Professor Muhammad Yunus, Founder of Grameen Bank; Mr. Nasser Al Khatani, the Executive Director of Arab Gulf Program for Development (AGFUND) based in Saudi Arabia; and Dr. Jaime Aristotle Alip, Founder & Managing Director, CARD MRI, Philippines. The plenary’s main focus was how can solving social problems lead to sustainable businesses? This plenary highlighted examples on how social investors and MFIs in the Philippines and other countries turned social problems into business opportunities. The panelists then led us through the process of defining a social problem and coming up with creative solutions for addressing that problem through social businesses.
Hear more of Muhammad Yunus’s and the rest of the panelist’s very inspiring speeches HERE: http://new.livestream.com/accounts/2071894/PartnershipsAgainstPovertySummit2013
After the break, the “From intent to action: Resources to ensure responsible inclusive finance” workshop was given. Speakers on the panel included Dina Pons, Social Performance Task Force (SPTF) & Investment Manager and Social Performance Management Coordinator, Incofin IM; Gilbert Maramba, Research and Development Department, Negros Women for Tomorrow Foundation (NWTF), Philippines; Yasser Ashfaq, Group Head, Financial Services Group, Pakistan Poverty Alleviation Fund (PPAF), Pakistan; and Mila Mercado-Bunker, President, Ahon Sa Hirap, Inc. and Chair of the Microfinance Council of the Philippines. The workshop was organized in partnership with the Responsible Inclusive Finance Working Group and provided a brief overview of responsible inclusive finance, defining the issue and describing the various initiatives and resources available to MFIs. It also provided a step-by-step roadmap for MFIs to improve their responsible inclusive finance practice.
Other workshops during the day included the “partnerships that utilize microfinance for post disaster assistance and post conflict support” workshop mediated by Michael Knaute, Executive Director, Convergences, France; and joined by Maud Savary-Mornet, Regional Manager, East and South East Asia, responsibility; Ben Warren, Kubaru; and Rev. Tambwe wa Tambwe Musangelu, Executive Director, Diku Dilenga RD du Congo . The main questions that were addressed included How Microfinance can serve the needs of such vulnerable populations once disaster strikes?, How these institutions flourish and develop, and also How these disasters affect MFI’s in general?
The day ended with the closing session including recognition’s and Thank you’s …and as Muhammad Yunus concluded by saying “continue to expand”
The Closing Plenary session for the 2013 Partnerships against Poverty Summit begins in just 30 minutes. You don’t want to miss this session–and you don’t have to! Visit http://partnershipsagainstpoverty.org/livestream to watch the session LIVE.
The Closing Plenary will have two main focal points: Truelift Milestone Institution Recognition and announcing the Global Commitments from attending organizations.
Truelift debuted at the 2011 Global Microcredit Summit in Valladolid, Spain as a global initiative to renew focus on the pro-poor objective of microfinance, i.e., a Trustmark that signifies a commitment to positive and enduring change for people living in poverty, in microfinance and beyond.
Truelift recognizes and advocates for pro-poor principles in microfinance, provides a framework, learning environment and recognition, aligns profitability with social inclusion, draws attention to good models, and collaborates with industry efforts including Smart Campaign and Social Performance Task Force.
Among the first 7 “milestone” MFIs that Truelift will be recognizing, the Negros Women for Tomorrow Foundation (NWTF) is the first Filipino MFI. They are receiving this award for showing the highest poverty outreach of all MFIs in the Grameen Foundation poverty calculation research (from 30%-64%) based on the PPI data. The Board at NWTF has also established an SPM Committee to work more on positive change in client’s lives and provide direction based on the poverty movement data received, including an increase in the activities of the Client Service Department for non-financial services. Gilbert Maramba, research and development manager for Negros Women for Tomorrow Foundation, Inc. in the Philippines will be representing.
Global Commitments to end poverty will also be announced at the closing plenary. According to the Global Findex study, more than half of the people in the world do not currently have formal financial accounts, especially the poor, women, people living in rural areas, and those with limited education.
To increase meaningful financial inclusion, two key avenues must be pursued. The first is to promote broader use of reliable and accurate poverty measurement tools so that practitioners can more clearly identify their level of poverty down-reach and better target their services to intended client groups. The second is to facilitate practices that lead to movement out of poverty through learning, product and service development, creating cross sector partnerships, targeted investor and donor funding, and building ways to better serve poor clients and meet their needs for the journey out of poverty.
Large multinational institutions, small practitioners just setting out, advocates and members of civil society, funders, investors, academics and the financial service providers themselves will be making commitments for achieving the 100 Million Goal: helping 100 million families lift themselves out of severe poverty.
One day, while walking through the streets of Manila, I encountered two people who triggered lingering thoughts with me: the child selling turon on the overpass and the seemingly mentally handicapped man selling sampaguita in front of a high class dormitory across one of the Philippines’ top universities.
Honestly speaking, I wouldn’t have noticed them had it not been for my friend, who was walking with me at the time. He said, “Didn’t you see how teary-eyed the man was?” and later on, he asked, “Why do these people have to undergo these things? That kid should’ve been studying instead.”
Truthfully speaking, I never even bothered to look. I had been conditioned to draw my eyes away from the poverty that surrounded me, to cringe at the touch of a dirty hand reaching out, and to generally be disgusted with the people who need my help the most. I had been conditioned to question whether these people really need help, and, for years, I had been convinced that the sentiment “it will only encourage them” was true and not encouraging this behavior greatly outweighs the prospect of helping another person in need.
For the longest time, the prospect of helping has been to hone myself to the fullest and to help these people when, and only when, I have already achieved my best state. My idea of helping used to be grandiose: I wanted to change the system from the inside and start helping only when I have obtained enough power to do so. Most of the people I know also subscribe to this kind of thinking. But we never bother to ask: if you ever do achieve that state, what happens in the period between that state and yesterday: what happens in the now? More importantly, what happens if you never reach that state at all?
Sadly, in that in-between, most people are happy to wallow in a state of limbo and apathy. What we don’t realize is that we’re merely looking for excuses to refuse in helping others because it’s troublesome. While there might be the possibility of feeling helpless and feeling like whatever you do won’t really make a difference, with introspection, perhaps you’ll realize that you simply don’t want to give more than what is convenient. At least I did. I realized that I can give no more than loose change. I can’t give to these people unless it’s something I don’t want or it’s an excess. I realized that the only thing I was really willing to give were rejects and rejection. This holds true even with the notion of wanting to change things only when I have enough power: it holds a lack of urgency and doing it only when I’ve reached a state of lavishness.
Another problem with this kind of thinking is that it creates a disconnection between the self and the other: we end up alienating the people who need our help. With this kind of view, the drive to help is a lot less compelling, and we start viewing the act of helping more as a luxury than a need. For most of us, this is enough justification to refuse to act for the betterment of others.
Don’t get me wrong, though. I’m not saying that you’re a bad person because you refused to give anything to that beggar on the corner of the street or because you don’t spend your weekends teaching children with learning disabilities. What I’m trying to point out is this: Unless you are severely marginalized, ostracized, and vulnerable, you will be taught that those who do belong to that category brought it upon themselves, and that it will never be your responsibility to help them. You are only expected to act towards alleviating their marginalization when you have the luxury to do so.
Helping others usually ends up in the bottom of a list of priorities. To make matters worse, the way we blame the victims by saying that they are poor because they are lazy and they are worthless, without considering that these people have no money to invest and little skills to employ. This does nothing but further exclude them from society. This prevents them and their children from changing their situation of destitution. The systems that are employed by society today are driven by those priorities, this callousness, and the social exclusion brought by these.
While the fastest growing economies are in Asia and the Pacific, two-thirds of the world’s poor also live here. The growth of the economy benefits only those at the top of the pyramid and those at the bottom remain there. The gap between the rich and the poor grows: the rich grow ever richer and the poor, poorer.
This is why, as pointed out by the BSP Governor Amando Tetangco and the World Bank President Jim Yong Kim, systematic changes must be made–we cannot simply wait for wealth to trickle down to the grassroots; we cannot delay attempts to lift the poor out of extreme poverty.
As people who have faced constant rejection, what the poor need the most is empowerment, and this can be done through offering social protection and inclusion. As Gov. Tetangco said, we have given them access to microcredit from formal financial service providers, and the challenge is how to reach out to the millions of people who live in extreme poverty.
I cannot agree more with the World Bank President Kim Yong Jim when he said, “When a poor family has access to something as simple as mobile phone payments or a savings account, it could open the door to services such as water, electricity, and education.” Simple services, when made more accessible and less discriminating, can allow the most marginalized to gain more capabilities to allow them to take more steps in living their lives to the fullest.
Alleviating millions of people from extreme poverty is possible, but it requires a change of perspective, and more importantly, a change in the system.
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The following are selected highlights of Day 2 at the 2013 Summit
Day 2 started off with the Plenary “Going the Extra Mile: From Safety Nets to Pathways out of Poverty.”
Roshaneh Zafar, founder and managing director of Kashf Foundation in Pakistan, stated that:
[this topic poses] an exciting challenge and a balance because on one hand, we have MFIs that want to do more and on the other hand we have government led programs, so we can see if the two shall meet.
Others on the panel included Secretary Corazon Juliano-Soliman (Secretary, Department of Social Welfare and Development, President’s Cabinet, Philippines) and Juan Borga (Outreach and Partnerships, Lead Specialist, Inter-American Development Bank) to discuss their role as funders and policy makers. Practitioners pitched their methodologies for providing pathways out of poverty:
- Yves Moury (President and Executive Director, Fondación Capital) pitched the benefits of conditional cash transfers (CCTs)
- Syed M. Hashemi (Professor, BRAC University, Bangladesh) pitched the graduation model
- Nelly Otieno (Financial Inclusion Sector Manager, CARE International, Kenya) pitched savings groups model
- Chandra Shekhar Ghosh (Chairman & Managing Director, Bandhan, India) pitched integrated health and financial services
As moderator, Ms. Zafar posed the following questions to Secretary Soliman:
(1) In terms of cash transfers and graduation schemes and so on, Is there a certain eligibility criteria for qualifying for these schemes? She answered,
We have the “National Household Target System” which identifies 5.2 million poor families, and of that 4.3 million were identified as eligible because of the children that they have ranging in age from 0 to 14 years (we will extend that to 18 years of age in the year 2014 so that they can have support for high school students). The conditions should be to keep these children in school and keep them off the streets and healthy. The child should be in school at least 85% of the month, and they should visit the health clinic at least once a month, and de-worming twice a year. Also, the attendance in ‘family development sessions’ is mandatory (20 t0 30 partner beneficiaries discussing a whole range of topics from health, responsible parenthood, raising children etc…).
(2) How do you measure impact (changes)? She answered that, for example, pregnant women receive post natal and anti natal services higher than in areas where conditional cash transfers (CCTs) are not implemented, an approximately 15% an increase.
(3), How do you make sure that these families or households don’t become dependent on CCTs and are able to graduate? Secretary Soliman answered,
We have a convergence strategy where we have CCTs, community driven development and sustainable livelihood converging in municipalities where we have the CCT families. We provide interventions through community driven enterprise development and capacity building and employment facilitation. That’s a step we are taking so that they can easily move in to self-sufficiency.
Ms. Zafar posed the following questions to Mr. Borga: What are some pros and cons of such schemes?
Within the Inter-American Development Bank, we have a multilateral investment fund, which gives small grants. The idea is that these funds work as a laboratory to give a taste of different new schemes and possibilities. Always working with the bottom of the pyramid and trying to help them access market skills, and basic services.
What we have been seeing when it comes to CCTs programs is that poor people want to save but they don’t have the right instruments or the right incentives to do so. We are trying to create a system in which creates a relationship between the recipients of the CCTs and the financial Institutions. A problem we see we see is that the financial Institutions don’t really provide them with the products they would like to have.
After that, practitioner members of the panel pitched their method for providing pathways out of poverty and Secretary Soliman and Mr. Borga weighed in on each pitch, judging which one they thought had most potential. Ms. Otieno (CARE International) on savings groups and asset building: Who are we really reaching through microcredit? And we need to consider the underlying causes of poverty.
We do not want to romanticize the Poor… (Secretary Corazon Juliano-Soliman)
2 commitments were then made:
1) Health and microfinance clients; demonstrating their partnership and commitment
D.S.K. Rao, Regional Director for Asia Pacific, Microcredit Summit Campaign, India and Marcia Metcalfe, Director, Microfinance and Health, Freedom from Hunger, USA
- To secure funding to develop and test health program indicators by year end 2014 that will enable our partners the MFIs and SHG’s that are providing health programs to measure the impact of such programs, and sign up to 10 partners who by 2015 will agree to collect these indicators and share them with their peers.
- By 2015, we commit to reaching 1 million poor families in financial services orgs. With integrated financial and health services and continue to contribute to their improved well-being and their families by 2015.
2) Microfinance council of the Philippines and the dept. of social welfare and development presented by Corazon Juliano-Soliman, Secretary, Department of Social Welfare and Development, President’s Cabinet, Philippines. A private sector/public partnership.
The commitments were then followed by a Workshop on digitization of financial ecosystems.
After the workshop, the Plenary “Reaching Deeper and Lowering Costs: The Path ahead for Digital Services” was conducted by our very own Sabina Rogers. Guests included Mr. Ian Radcliffe, Director, WSBI-ESBG, Belgium; Mr. Napoleon Nazareno, President and CEO of PLDT and smart Communications, Philippines; Mr. Nadeem Hussein, President and CEO of Tameer Microfinance Bank, Pakistan; Mr. Raj Singh-Khaira, Vice President, RM & Consumer Services, FINO PayTech, India; and Mr. Gordon Cooper, Head of Emerging Market Solutions, Asia Pacific, Central Europe, Middle East and Africa, VISA, USA. Digital transactions have the potential to make the delivery of financial services a fixed cost rather than a variable cost. Once the basic network is in place, adding new clients brings very little additional cost. Some countries have been able to tap into the potential of digital transaction to bring large percentages of the population into a common payment system. On the other hand, only a few have successfully implemented large scale delivery of other financial services (savings, credit, insurance) using digital channels. What are these examples of progress and how can lessons from one context be understood and adapted in another? What’s next in the digital age and how can products and services better serve the very poor in their journey out of severe poverty? And most importantly, how can actors from across the sectors develop powerful synergies to make the most of the tools emerging in this digital age?
Congratulations to the Ignite Forum for officially launching at the 2013 Summit! For more on Ignite, visit http://igniteforum.org/
Watch the live stream at: http://new.livestream.com/accounts/2071894/PartnershipsAgainstPovertySummit2013
The opening ceremony started of with a speech from Mr. Larry Reed, the Director of the Microcredit Summit Campaign and Mrs. Mila Mercado Bunker, the President of Ahon sa Hirap, Inc. (ASHI), and Chairperson of the Microfinance Council of the Philippines, Inc. After that, there were speeches made by some of the speakers including Amando Tetangco Jr., the Governor of the Central Bank of the Philippines, Philippines; Florencio “Butch” Abad, Budget Secretary, Philippines; Sharif al din Hasan, Minister, Ministry of Cooperatives and SMEs, Indonesia; Muhammad Yunus, Founderof Grameen Bank, Bangladesh; and Karen Dávila, award-winning Filipino broadcast journalist and television and presenter. In his speech, Governer Tetango said, “It is my personal wish to see every Filipino productively contributing to and reaping the benefits of a robust economy. This vision also underlies the policy and regulatory actions of the Bangko Sentral ng Pilipinas. We endeavor to maintain price stability; safeguard the soundness and efficiency of the financial system, at the same time provide an environment that enables every citizen, especially the poor, to access appropriate financial services including microcredit. We are all here because we share the same vision and goal. Together we can cover a lot of ground. Now is the time for all of us in the public and private sectors to work more closely together as partners in achieving high productivity and economic growth that translates into better lives.” He added that “two thirds of the worlds poor live in Asia and the Pacific region”…
According to Budget secretary Florencio Abad, “The Philipines is in the midst of a process of substantial changes in governance”. The main question of the day was how can government reform help financial inclusion in your country? Secretary Abad adds “Economic prosperity of nations depends on the nature of political institutions”. “The government and commercial banks cannot help achieve financial inclusion as well as MFIs and other organisations. Financial inclusion requires grass roots support and community presence which the commercial banks are unable to provide”
Additionally, there was showing of a speech made by World Bank President Jim Yong Kim. See here: https://100millionideas.org/2013/10/07/live-streaming-plenary-sessions-at-the-2013-summit/
As well as a speech made by Mrs. Valerie Boffy, speaking about her experiences climbing Mt. Everest and its paralels with combating extreme poverty. The kind of resources and strength you need to climb the Everest is comparable to the things you need for ending poverty. Climbing the Everest requires technology, experience/know-how, confidence, favourable weather, good health and luck. The same ingredients are required to end poverty. She also talks about her non-profit entity, Women on a Mission, which she co-founded helping to combat poverty by raising awareness and funds for a humanitarian cause. See more here: https://mcsummit.wordpress.com/wp-admin/post.php?post=3246&action=edit
Professor Muhammad Yunus Interview: See more at: http://new.livestream.com/accounts/2071894/PartnershipsAgainstPovertySummit2013
Can MF lend to anybody? Nobody should be out of the financial services. Everybody should have access to financial services… We have to redesign products to keep everyone within the financial sector. When we started Microcredit, we were NOT looking at job creation; we were focusing more on self- employment. The future for poor people is in self-employment. It’s about creating entrepreneurs. Each borrower can create jobs. We believe all human beings are entrepreneurs. If you want to solve the problem of poverty by job creation, you won’t go very far. Look at Europe for example; half of the youth are unemployed because all structure is based on creating jobs and not on creating entrepreneurs.
Define social business? A non-dividend company to solve human problems. We have created many social businesses in Bangladesh. We have taken this message abroad. We create a social fund. Gradually they buy us out and repay us without paying over and above the capital. We have no expectation of returns whatsoever. Money has become an addiction. That is a distortion of being human. Humans are selfish and yet selfless. A Social Business is not martyrdom, it’s not charity. I do business my capital comes back. In charity, money is used once. Here, money goes out and comes back in. This is business and appeals to poor people right away. Every business can run a Social business in parallel.
What makes some clients succeed? No one fails but the range of success differs, some are small and some major. People do it in a very marginal way, first they pay back with interest. That’s a success I would say. Then you save a bit and send children to school. That’s a success. So you have to go step by step. By selling few chickens you don’t change your life. You change your life by changing your mindset. Selling a few chickens starts that mind set change. These are the heroes of history. They have changed the financial system. It’s the same the world over. We work in NYC now. Our address has changed holistically. We need to ask what we are doing for this second generation, our kids generation. Also, Bangladesh was a basket case as declared by the ‘big guys’. We have to prove them wrong. We have achieved the first MDG to reduce poverty by half and so the next round will be easier for us. We will create poverty museums. We have created the steel in ourselves to address.
Does family planning end poverty? It is complex. Despite everything that we have. We persuaded our leaders to reduce poverty. We have to believe in it. Corruption is a big issue. Bad governance too. It all holds us up. Let us not comprise on our major goal.
What more can MFIs do? Learn from each other. Charge our batteries. Win the war with determination. Again, NOBODY should be excluded. We have to evolve to a more holistic approach. Our entire mission is to help people come out of poverty. MFI is merely a tool to do so, It’s not our main business. We would like to be the first county to build a poverty museum.
Where do you get the fire? When you see the change your work you bubble with enthusiasm. I say I remove profit from business. People say that is the inventive. I say profit is not the only incentive. Making yourself money that is happiness. But you make others happy that is super happiness. We’ll make it! We will not fail in 2030. We will come up with 15 new ideas and make things happen. We will win this war.
The Partnership Plenary was next. How, when and why to partner? This plenary focused on the question ‘What is a multi-sector partnership?’ – an ongoing working relationship which shares risks and benefits.
- opportunities for collaboration are widening
- stakeholder engagement is taking place
- profile, branding and communication matter
- organisations are becoming increasingly strategic in their engagement
- organisations use local networks for global partnerships
- stakeholders are increasingly important
What is an ideal partner?
- knowledge sharer
- creates synergy
- clear value proposition
How do originations partner?
The partnering cycle includes:
Partnerships work when:
- there are right partners
- they achieve the right results
- add value to all partners
- appreciate the transactional costs involved with the partnerships
- highest standards of project management
- engagement and buy in across the board
- culture of ongoing review
- Global index shows that 2.5 billions left out! 70% of the poor are unbanked
- it’s time to take what works and leverage it in bigger ways
- the big question is why does it matter – what is needed
Roger Voorhies (Bill and Melinda Gates foundation)
Richard Leftley – Micro Ensure
Working with MFIs… The most successful case is giving insurance as a reward for using air time – this benefits the client and the teleco provider
- never take short cuts in Microfinance
- record base line data and measure the impact
Summary of the partnerships plenary:
i. Emerging trends
ii. What is an ideal partner
iii. How do originations partner
See the opening ceremony including all the Interviews at http://new.livestream.com/accounts/2071894/PartnershipsAgainstPovertySummit2013
Preview of Day 2 (October 11th 2013)
Going the Extra Mile plenary: This is a modified pitch session in which each practitioner will give an elevator pitch to present their concept for creating pathways out of poverty and to answer the question, why does your program have the most potential to help the most people move out of poverty, and how can we design a program that has the most potential to help the most people do that? They will than be scrutinized and their pitch judged.
Check out the Speakers here: http://partnershipsagainstpoverty.org/going-the-extra-mile-from-safety-nets-to-pathways-out-of-poverty/
And it can also be viewed live streamed here: http://partnershipsagainstpoverty.org/livestream/
The key question in this workshop session was how to help include the poor in value chains; poor producers are generally too small to transact directly with large buyers. This exclusion leads to the poor selling to small poor buyers which reduces prices and decreases value for the poor producers. This problem is most exacerbated in agriculture, livestock and other perishables. In the absence of proper storage facilities – i.e. cold storage facilities and/or proper transport facilities, low-income producers are forced to sell as they produce which may not be the most favorable keeping in view price fluctuations.
Multiple examples from numerous organizations were shared in this session that aimed to address just this conundrum – how to help poor farmers and other micro-entrepreneurs better integrate in value chains. This essentially requires the establishment of a national enabling environment through linkages of small producers to specialized organization at each step of the value-chain.
The Jollibee Foundation shared its investment into and organization of onion farmers cooperatives which helps increase prices for farmers up to 75% more than they would be able to without the value chain. Jollibee Foods requires a steady supply of onions for its ‘secret recipe’ but unfortunately onions are only grown once in the year in the Philippines. While larger farmers can store these onions in proper storage facilities, smaller farmers need to sell the onion as soon as they harvest them. Naturally this reduces profit margins for small farmers. Jollibee Foundation has helped organize farmers into cooperatives by ensuring purchase of onions grown by the farmer cooperatives. As a consequence of this steady and confirmed demand, MFIs give loans to the small farmers to help them form these cooperatives. Through these cooperatives, a win-win situation emerges wherein the farmers earn better prices for their onions and Jollibee is assured a steady and fresh supply of onions.
Another value chain development project for small farmers that was featured was cashew nut processing through NABARD in India. NABARD has been able to secure a direct buyer for processed cashew nuts in Wal-Mart USA as a result of which it has been able to help small farmers form into a production cooperative. The production cooperative is trained and supported in replacing manual techniques such as breaking the shell by hand with using machines to do the same. Moreover NABARD has also introduced drying machines and trained the farmers on techniques of how to grade the quality of the cashew nuts processed. NABARD also involves the local governmental agriculture officer that helps with monitoring and trainings aspects at various steps along the value-chain. As a result of this value chain, poor farmers have been able to earn much fairer prices and have been able to register themselves as production cooperatives.
The main crux of the session was that there are multiple ways in which Financial Institutions; especially MFIs can support value chain development in small/poor farmers. The process needs creativity, an enabling regulatory environment, willing partners, and involvement of multiple stakeholders!
The much anticipated talk with Dr. Yunus was the key highlight of the opening session at the Partnerships against Poverty 2013. Dr. Yunus began microfinance in Bangladesh around 37 years back, starting initially as a lender to the poor, then becoming a guarantor to enable the poor to borrow from banks, and then finally setting up an institution to provide access to finance to the poor. Dr Yunus shared that, in his experience, women were better borrowers for credit but the microfinance-women nexus is something he had to try hard to forge. In the beginning, his aim was to service at least 50% women but even getting to 50% was a daunting task- it took Grameen Bank 6 years to achieve this milestone. Today, 97% of Grameen Bank clients are women. Dr Yunus shared that when women borrowed there was a greater impact on household development as compared to when men borrowed money. Moreover, as women were more focused on ensuring that their children develop, they invested much more on their future. Dr. Yunus believes that the success the women borrowers of Grameen Bank have played a major role in the success of Grameen Bank.
Dr. Yunus stressed on the importance of creating entrepreneurs and said that the inability to create entrepreneurs is one of the biggest failings of the conventional financial service providers. He shared that all human beings are entrepreneurs but the role of the MFIs is to help clients unleash that entrepreneur that exists within themselves. Moreover, Dr. Yunus shared the concept of the social businesses, which according to him are non-dividend companies set up to solve human problems using creative capacity to address the problems being addressed. He shared that youth unemployment is a big problem in Bangladesh (as in many other parts of the world) but it can be addressed through social business – he shared the concept of the Youth Entrepreneur Fund which launches the youth into entrepreneurship. The entrepreneur gets an interest free loan which he/she has to return in 3 years. He said the basic difference between a social business and philanthropy is that in the former the money comes back while in the latter money doesn’t come back. Dr Yunus further added that being able to catalyze change is the biggest benefit of social businesses – while making money makes you happy, making others happy makes you ‘superhappy’.
Dr Yunus ended his talk with the message that “we will make it”, he was referring primarily to the Millennium Development Goals (MGDs). He shared with a lot of pride that Bangladesh had actually halved poverty in 2013 (2 years before the deadline for the 1st MGD), and is poised to meet all 8 MGDs by the year 2015. He said that Bangladesh had been deemed a ‘basket case’, but if Bangladesh can do it so can other countries! He urged all delegates to ensure that 2015 ends with meeting the MGDs!