Webinar recap: Is it too late for microfinance to be pro poor?

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On April 21st, the Microcredit Summit Campaign co-hosted with Uplift a webinar discussion focusing on the promise that graduation holds for sustainably reaching the ultra-poor. Our featured speakers were Debasish Ray Chaudhuri, CEO of Bandhan Konnagar in India, Rachel Proefke, a research associate with BRAC Uganda, Mark Daniels, the Philippines director for Opportunity International, and Allison Duncan, CEO of Amplifier Strategies and founder of Uplift. Anne Hastings, a global advocate with Uplift, moderated the webinar.

The conversation looked closely at the experiences that each of the three practitioners on the panel have had in implementing the program as well as the global advocacy message supporting the graduation approach being delivered by Uplift and its allies.

We hope you will get engaged with this promising avenue for reaching those living in ultra-poverty and be inspired by the potential it holds for helping microfinance institutions to reconnect to their original purpose. Some final thoughts from speakers on the webinar follow.

Anne Hastings noted,

We weren’t really able to address in depth how a pro-poor MFI, struggling for sustainability in a competitive, regulated environment can attain sustainability while operating the graduation program. In the models we saw, the institution was either an NGO or a regulated MFI that had formed a non-profit foundation for the graduation program and perhaps the delivery of other non-financial services. We shouldn’t be surprised or embarrassed that donor funding may still be needed, but partnerships with government safety net programs and other NGOs can also be very helpful in paying for the program. As the 6 RCTs funded by the Ford Foundation concluded, “Although more can be learned about how to optimize the design and implementation of the program, we establish that a multifaceted approach to increasing income and well-being for the ultra-poor is sustainable and cost-effective.” (Science Magazine, 15 May 2015, Vol 348 Issue 6236, p. 772.)

Rachel Profke added,

I think the point that I would stress, which we begun to address in the discussion, is the importance of finding the right partner for the implementation of components that an MFI does not have the core capacity to implement. While BRAC is able to leverage both microfinance and additional programming in the areas that we operate all programs, this is not always the case for us or other MFIs that will be interested in implementing graduation programming. Often, MFIs can provide the scale in identifying communities and in providing financial services, but linkages with implementing partners providing similar programming is fundamental to ensuring best practices in programming — as Mark highlighted. However, aside from NGO implementers, governments are often running existing programming that can be leveraged not only in identifying beneficiaries through such channels as social protection programming but also in providing some components through existing service provision, in terms of health or extension services. We find it helpful to look at what is already at place — and at scale — through government programs is useful, as we have done in Tanzania. This is also useful as we think about scaling because, apart from donor buy-in, governments offer larger potential through larger budgets and capacity.

Thank you to all panelists for contributing to this important conversation about the importance of the graduation approach. We also wish to thank all participants who submitted thought-provoking questions and comments to help make the session a very lively and interactive discussion!

Couldn’t join us? Watch the session recording!

Yunus Centre fulfills Campaign Commitment by cultivating ‘job-givers’

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The Yunus Centre has worked tirelessly to promote the philosophy of Professor Mohammad Yunus and to alleviate poverty through social entrepreneurship and turning ‘job-seekers’ into ‘job-givers’. The Yunus Centre declared its support for the goal of helping 100 million families lift themselves out of extreme poverty by announcing a Campaign Commitment at the 2013 Partnerships against Poverty Summit held last October 2013 in Manila, Philippines. The Microcredit Summit Campaign recently caught up with the Yunus Centre to learn about the progress they’ve made on their Commitment and the ways they are working towards the end of extreme poverty.


“The poor themselves can create a poverty-free world all we have to do is to free them from the chains that we have put around them.” – Professor Mohammad Yunus

Yunus

Professor Mohammad Yunus, winner of Nobel Peace Prize for his work with microfinance and founding of the Grameen Bank in Bangladesh. Image courtesy of Yunus Centre.

Founded in 2006, the Yunus Centre actively promotes and disseminates the philosophy of world-renowned microfinance leader Professor Mohammad Yunus. Professor Yunus believes we can achieve the end of poverty through microfinance and social entrepreneurship.

In October of 2013, the Yunus Centre made the Commitment to support the 100 Million Project through the following actions:

By the end of 2018:

  • Create a global social business sector serving at least 100 million poor, and providing jobs and for at least 10 million households.

In just over one year, by the end of 2014:

  • Help create, finance and expand more than 50 social businesses in at least 20 countries world-wide.
  • Create Social Business Incubator Funds, and other structures, in at least 8 countries: Albania, Bangladesh, Brazil, Colombia, Haiti, India, Tunisia and Uganda
  • Social businesses in Bangladesh will serve at least 2 million households, and employ at least 20,000 households.
  • Collect and publish relevant social-impact data for all social businesses.

Yunus Centre Campaign Commitment Outlook: Achieving the 2014 Benchmarks   

The Yunus Centre has achieved outstanding progress since announcing its Campaign Commitment in 2013.

The Yunus Centre has met its 2013 benchmark of creating, financing and expanding more than 50 social businesses.

As of May 2014, the Yunus Centre has helped launch more than 100 new social businesses in Bangladesh. Recently the Yunus Centre introduced a new initiative called nobin udyoktas(‘new entrepreneurs’ in Bangladeshi) which is aimed primarily at the children of Grameen Bank borrowers and intends to turn them from ‘job seekers’ into ‘job creators’. Every month the Yunus Centre hosts a social business design lab which is a platform for entrepreneurs to present their social business designs in front of experienced business executives and social activists. Initial successes have helped the Yunus Centre to gain momentum in encouraging youth to make their own destiny through social business ventures. The Centre projects that it will reach 200 new social businesses by the end of 2014.

However work remains to be done. The Yunus Centre committed to create, finance, and expand more than 50 social businesses in 20 countries worldwide. They have achieved remarkable success in Bangladesh, but what about the rest of the world? So far Yunus Social Business (YSB) has launched social businesses in Colombia, Costa Rica, Tunisia, Haiti and Albania.As an example, in Colombia, the Yunus Centre partnered with McCain Foods to launch Campo Vivo, a social business that will benefit farmers living in poverty by aiding them in the production and commercialization of potatoes, carrots and peas. The Yunus Centre has made great progress towards achieving the first goal of its Commitment; nonetheless, expanding social businesses into other countries will remain a priority as they seek to reach their target of 20.

Yunus Centre has achieved its goal of creating Social Business Incubator Funds in eight countries.

Yunus Centre launched Social Business Incubator Funds in Bangladesh, Brazil, Colombia, Haiti, Albania, Tunisia, Uganda and India since 2013. The goal of these incubator funds is to provide start-up investment for social businesses when traditional banks may not be willing to invest. The funds are designed to be financially sustainable at $13.5 to $20.5 million and can be expected to invest in approximately 6 new social businesses each year. Some of the incubator funds are already providing services to entrepreneurs.

Although the Yunus Centre has made considerable progress towards achieving its Commitment, it has not yet been able to quantify its impact.

In October of 2013, the Yunus Centre boldly committed to helping social businesses serve 2 million households and employ 20,000 households. Because most of the social businesses are start-up enterprises, they are in the process of developing their market and scaling up their operations. Therefore, it is difficult to estimate exactly how many households the social businesses are currently serving. The number is undoubtedly increasing as new social businesses are generated across Bangladesh. Once the Yunus Centre better determines how many households are being served and employed by social businesses in Bangladesh, it will publish the information on socialbusinesspedia.com. After a social business has been operational for a few years and it becomes feasible to measure its impact, the Yunus Centre publishes all relevant social impact data on Social Business Pedia.

Grameen Veolia

Grameen-Veolia Water Ltd. Image courtesy of Yunus Centre.


Join us in Mexico for the 17th Microcredit Summit this September 3-5. Professor Yunus will be a keynote speaker in addition to moderating workshops on social business and youth employment. http://17microcreditsummit.org/


Turning Social Businesses into a Poverty Elimination Tool 

One example of a social business pioneered by the Yunus Foundation is Grameen-Veolia Water Ltd. Although water supply is abundant in Bangladesh, much of the groundwater is contaminated with arsenic for geological reasons. Grameen Healthcare Services partnered with Veolia Water to provide clean water and distribute it to a vast network of rural villages. The joint venture has been established according to the social business principals advocated by the Yunus Centre.

One example of a social business pioneered by the Yunus Foundation is Grameen-Veolia Water Ltd. Although water supply is abundant in Bangladesh, much of the groundwater is contaminated with arsenic for geological reasons. Grameen Healthcare Services partnered with Veolia Water to provide clean water and distribute it to a vast network of rural villages. The joint venture has been established according to the social business principals advocated by the Yunus Centre.

The Yunus Centre views its Campaign Commitment as an integral part of the achieving its mission and helping lift 100 million families out of extreme poverty. The Commitment contributes in two ways to the goal: 1) new services are being introduced to the next generation of microfinance stakeholders, and 2) the ‘nobin udyokta’ initiative is providing equity financing for social businesses to create a generation of ‘job givers’ instead of ‘job seekers’. Professor Yunus shared his enthusiasm for the progress the Yunus Centre has made towards achieving its Commitment stating, “We are excited about new possible openings, especially social business gaining momentum in many countries. It’s a starting point for a global movement.”

Through these efforts the Yunus Centre is making large contributions to the 100 Million Goal. Standing alongside the Campaign’s coalition of actors who have stated their Campaign Commitment, the Yunus Centre is helping make the end of extreme poverty possible and achievable.


Join Yunus Centre and State your Campaign Commitment

Join Yunus Centre in the global coalition help 100 million families lift themselves out of poverty – state your Campaign Commitment at mycommitment@microcreditsummit.org

Need additional guidance in formulating your own Campaign Commitment? Refer to our Commitment Development Toolkit.

Be social with us on Facebook and Twitter (@MicroCredSummit) using the hashtags #Commit100M and #100MGoal

Learn more about the Microcredit Summit Campaign: http://www.microcreditsummit.org/

BRAC Uganda reaches 100,000 microfinance borrowers in less than 3.5 Years

Congratulations to the great work BRAC Uganda is doing in providing microcredit to East Africa!

Dr. Fazle Hasan Abed, the Founder and Chairperson of BRAC disbursed BRAC Uganda’s first ever loan in June 2006 at the Iganga branch.Dr. Abed is also serving on MCS’ Regional Advisory Committee for the upcoming Africa-Middle East Regional Microcredit Summit, April 2010 in Nairobi, Kenya.

From their announcement:

“BRAC Uganda has set a remarkable record by reaching 100,000 borrowers in less than 3.5 years since that start of its microfinance operations in Uganda in June 2006. With an average annual borrower growth rate of 139%, BRAC Uganda is in the company of other rapidly growing microfinance institutions in world.”