The State of the Campaign Report

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Executive Summary

December 8, 2015 · by RESULTS Educational Fund

The World Bank and the United Nations have both set their sights on ending extreme poverty by the year 2030. The Bank has also set a concomitant target of universal financial access by 2020 as a major contributor to ending extreme poverty. Our assessment, after reviewing the contributions that microfinance institutions and other financial providers have made toward these two goals, is this: if financial services are meant to play an important part in bringing an end to extreme poverty, we will not come close to reaching it. Microfinance has demonstrated the viability of providing financial services to people in poverty and technological advances have drastically reduced the cost of providing financial services. But, we still do not see widespread adoption of financial services among the largest groups of those that still need to be reached: those living in extreme poverty.

We use this State of the Campaign Report to highlight the progress of the microfinance community toward two goals set at our 2006 Global Microcredit Summit: 1) reach 175 million of the world’s poorest families with microfinance, and 2) help 100 million families lift themselves out of extreme poverty. This year, we report those numbers in the context of the larger movements to provide universal access to financial services and to end extreme poverty—and they show the challenge we are having in attaining our goals.

At the end of 2013, the microfinance community reached 211 million clients, 114 million of whom were living in extreme poverty.[1] While the microfinance community provided loans to the most clients in its history last year, the number of poorest clients fell for the third straight year. The growth in clients for microfinance has occurred primarily among those who live above US$1.90 a day.

The latest World Bank report on global poverty reports that, in 2012, 896 million people lived in extreme poverty.[2] The 2014 Global Findex reports that more than half of all adults in the poorest 40 percent of households in developing countries did not have access to formal financial services. (This is a 17 percent improvement over the 2011 Findex.[3]) That makes those living in poverty one of the largest and most difficult-to-reach population segments excluded from the financial system. The 2020 target of universal financial access compels us to reach everyone living in extreme poverty; yet, the part of the financial community that has done the most to expand financial access among the poor over the last few decades—microfinance providers—have stalled in their outreach to this segment.

A financial system that reaches and benefits everyone will need to provide financial services that people with the lowest income and with households in the most remote places find accessible and useful. This means we need to approach such a challenge with the end in mind—start from the end goal and work back to how we want to get there. In this way, we can design a system to sustainably reach clients in the most remote areas and who transact in the smallest sums. This design process must include the following steps:

Measure: In order to track our success with including those living in poverty, we must measure the income levels of the financially included, as well as the excluded. For this reason, we are greatly encouraged by the recent announcement from the World Bank that it will invest in conducting household surveys every three years in the 78 poorest countries—and making sure it happens.[4]

It also requires a good definition of success, that is, what it means to be included in the financial system. On the other hand, we believe the 2014 Findex’s definition for “financial included” is too narrow. It counts a person as included if they have an account at a registered financial institution or with a mobile money provider. We find this definition inadequate for two reasons. First, it excludes people who maintain accounts with savings groups or other informal savings and credit associations, as well as people who have accounts with microfinance providers that are not licensed banks. Second, it includes people who have opened accounts, but do not use them in any meaningful way. For us, true inclusion means that a person not only has an account but has access to a full range of financial services that they can use in a way that benefits them.

Map: Reaching the excluded requires knowing where they are. Mapping the locations of these excluded people helps us place them in their geographical, cultural, and economic context. It helps us understand the sets of related factors that may contribute to their exclusion.

Understand: People living in poverty use financial services to accomplish their own objectives: to mitigate risks, take advantage of opportunities, build a better future for their children, celebrate joys, and mourn losses. Those who seek to provide financial services for this group need to understand the rhythms of their lives, their aspirations, their fears, and their cash flows.

Design: This understanding can help financial service providers design products and services that match the objectives and life cycles of their clients at price points that reflect what people living in poverty can afford and what they value.

Deliver: Delivering these products and services at scale will require alliances and partnerships that together can provide delivery channels and aggregators to reduce costs, hasten response time, and improve service. MFIs, banks, savings associations, telecommunication companies, governments, civil society organizations, and NGOs can all play a role in delivering a range of useful products and services to a widely dispersed population.

At our 2013 Microcredit Summit in the Philippines, we focused on the partnerships required to deliver financial services to those living in poverty. At our 2014 Summit in Mexico, we focused on innovations in microfinance with a demonstrated capacity to reach those in extreme poverty. Since then, we have continued to research the products, services, delivery channels, partnerships, and alliances that will enable the financial services community to make financial inclusion a key pillar in the global movement to end extreme poverty. In this report, we present six “pathways” where financial services can support families in their journey out of extreme poverty.

Six Pathways

  1. Integrated health and microfinance: Health shocks often trap families in poverty or pull them back into it. They can also cause loan defaults and account closures. Financial providers can support growing livelihoods for their clients, and reduce risk in their portfolio, by providing health financing and health training, and by partnering with others to deliver health products and provide health services.
  2. Savings groups: The global savings group movement now reaches over 10 million clients worldwide, most of whom live on less income than the typical microfinance client. The self-help group movement in India provides financial services to over 50 million clients. Recent innovations with bank linkages, mobile delivery, and fee-for-service facilitation have expanded the range of services offered through these informal groups, while also increasing their viability.
  3. Graduation programs: The ultra-poor graduation model developed by BRAC has proved effective in Bangladesh and many other countries at reaching those living in the direst poverty and helping them to develop livelihoods and financial capability. Linking these programs to financial institutions and government social-protection programs can allow these initiatives to reach scale.
  4. Agricultural value chains: Most people living extreme poverty live in rural areas and earn most of their income from agricultural work. Expanding agricultural value chains to reach smallholder farmers, providing them with financing, risk mitigation tools, and access to the inputs and markets they need to expand production will increase income and employment opportunities.
  5. Conditional cash transfers: Government social-protection programs provide cash transfers (both conditional and unconditional) to households living in extreme poverty, to the elderly, and to those with physical disabilities. Delivering these payments through accounts in financial institutions, combined with incentives for savings and education, help households build assets over time.
  6. Digital finance: Digitizing financial transactions can greatly reduce costs, while increasing speed and accuracy, making it possible to profitably deliver transactions in small units and over great distances. The most popular financial service so far has been the ability to transfer payments over the phone. Recent innovations, such as getting mobile network providers to pay the cost of microinsurance as a lure to retain customers or mining transaction data to determine credit-worthiness, have expanded the range and value of services delivered digitally.

These six pathways represent key strategies to break out of the microfinance sector’s current stall and greatly expand outreach to those living in extreme poverty. They have even more power, though, when they are combined: for example, digitally delivering conditional cash transfers (CCTs) into a savings account, mobilizing the CCT recipients into savings groups, and furthering their ability to earn a livelihood through graduation programs.

In this report, we look more closely at each of these pathways and the ways that financial service providers can work within them. We also focus on the key role of mapping, an often overlooked step, in identifying where people living in extreme poverty reside and congregate, and what channels and linkages can provide the best routes for serving them.


← Previous: Read the full report Next: 2015 Report > Where’s the Map? →

Table of Contents

  • Executive Summary
  • Where’s the Map?
  • Global Data Show Diverging Paths
  • Integrated Health and Microfinance
  • Saving Groups
  • Graduation Programs
  • Agricultural Value Chains
  • Conditional Cash-Transfer Programs
  • Digital Finance
  • Conclusion
  • Data
  • Multimedia
  • Read the Full Report
  • Get Your Copy
  • Français (Coming soon!)
  • Español (Coming soon!)
  • Arabic (Coming soon!)

Expert Interviews

December 8, 2015 · by RESULTS Educational Fund
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Muhammad Yunus: The Business of Poverty Eradication
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Tara Nathan: Connectivity as a Pathway out of Poverty
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Syed Hashemi & Shameran Abed:
Reaching the Poorest of the Poor
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Marianna Escobar: Combining Conditional Cash Transfers and Livelihoods Training for the Poor
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Luis Fernando Sanabria: Poverty Stoplight: Families Mapping Their Pathway out of Poverty
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Glynis Rankin: The Next Generation of Leadership

← Previous:Infographics Next: Print Version →

“Poverty Stoplight” — Families Mapping Their Way Out of Poverty

December 8, 2015 · by virgiliakasbarian2014

Interview with Luis Fernando Sanabria, general manager, Fundación Paraguaya, Paraguay

Fundación Paraguaya is a microfinance institution that develops and implements innovative and long-lasting poverty eradication solutions. The interview in this box and all direct quotes not cited in the text are from interviews carried out by the Microcredit Summit Campaign.

Fundación Paraguaya’s mission goes beyond financial inclusion. We believe that, while financial inclusion is a powerful and essential tool, it is not enough to eliminate poverty: our mission is to develop innovative solutions to poverty and disseminate them worldwide. Not only do we try to financially include our 70,000 customers, but we also help them close the poverty gap and move out of poverty by providing solutions to the 50 indicators of poverty identified in our “Poverty Stoplight” methodology.

We believe that poverty is multidimensional. It is like a big gray cloud that crushes poor families. They feel overwhelmed by this cloud because it is so complex that it is hard to know where to start. They say, “I was born poor and will remain poor all of my life,” out of resignation, a lack of self-esteem, but above all, the lack of a starting plan.

The Poverty Stoplight tool aims to operationalize that concept by dividing that gray cloud into small pieces that can be taken by families one by one in order to move forward. We have divided our Poverty Stoplight into six dimensions: 1) income and employment, 2) education and culture, 3) health and environment, 4) housing and infrastructure, 5) organization and participation, and 6) interiority and motivational. These six dimensions have 50 indicators, and each indicator has three designations: red for extreme poverty, yellow for non-extreme poverty, and green for no poverty.

We developed self-assessment software for tablets and smartphones, wherein families evaluate themselves using photographs and their responses are georeferenced. For example, to not be poor in Paraguay (green) you need to have a faucet, a tap. If you have a well or a stream on your property, you are poor, but not extremely poor: you are yellow. If you have to bring water from outside your property, then you are extremely poor: you are red.

The Poverty Stoplight is different from other poverty measurement tools in a couple ways. First, families use the software to conduct a self-assessment and then create their own roadmap out of poverty. This is vital because it leaves the problem in the family’s hands. It is not organizations lifting people out of poverty, it is the families themselves. What we can do is provide tools to release the energy that is already within the poor.

Second, we are not an index. Indices serve their purpose, but for the poor, they mean very little. If you score 7 out of 10 in any given index, it means nothing to a poor person. However, the fact that you have a common bathroom and you need to have a modern bathroom to move out of poverty leads to a concrete action that can be carried out. Having a checklist like the Stoplight allows us to not forget any indicator because no one can move out of poverty until all the indicators are green.
This can improve MFI products and services because we have a map of the demand: who lacks water, health services, education, financial training, credit, and supplies, as well as who has no self-esteem and where violence against women takes place, etc. By being georeferenced, the demand provides us with a community map that allows us to coordinate the supply. This kind of map allows us, for example, to tell Paraguay’s public services, “Look, these 20 families in this community need training to make their family budget.”

We aspire to have the existing services in the public and private sectors seek their customers in a proactive way. This way, if we can get our organizations to reach out to them with a well-planned map, we have a better chance of succeeding.

To learn more about the Poverty Stoplight tool, visit http://www.fundacionparaguaya.org.py.


← Previous: 2015 Report > Where’s the Map? Next: Global Data Show Diverging Paths →

Table of Contents

  • Executive Summary
  • Where’s the Map?
  • Global Data Show Diverging Paths
  • Integrated Health and Microfinance
  • Saving Groups
  • Graduation Programs
  • Agricultural Value Chains
  • Conditional Cash-Transfer Programs
  • Digital Finance
  • Conclusion
  • Data
  • Multimedia
  • Read the Full Report
  • Get Your Copy
  • Français
  • Español
  • Arabic

Integrated Health and Microfinance

December 8, 2015 · by virgiliakasbarian2014
Figure 5: Savings Groups and Risk of Anemia among Children in Southern Mali

Figure 5_Anemia prevalence in Mali_EN full
Figure 5_Oxfam SfC Mali_EN full

Note: These two maps compare the predictive geographical risk of anemia in children aged 1−4 years against the reach of savings groups in southern Mali under Oxfam America’s Savings for Change program.
Source: R.J. Soares Magalhães and A.C.A. Clements, 2011, “Mapping the Risk of Anaemia in Preschool-Age Children: The Contribution of Malnutrition, Malaria, and Helminth Infections in West Africa,” PLOS Med 8(6): e1000438, doi:10.1371/journal.pmed.1000438; and J. Ashe, with K. Jagger Neilan, “In Their Own Hands: How Savings Groups Are Revolutionizing Development,” paper presented at the 17th Microcredit Summit, Merida, Mexico, September 3−5, 2014, http://17microcreditsummit.org/wp-content/uploads/2014/08/Savings-Groups-overview-for-MicroCredit-Summit-English-Jeff-Ashe-07-31-2014.pdf.

2015 Grama Vidiyal Campaign Commitment

“Sticking to its original mission, [Grama Vidiyal] reaches clients beyond the credit lines through its entire gamut of services—focusing on health, environment, social skills, etc. A double bottom-line approach with the right balance of fiscal performance and positive social impact is key to the microfinance’s success.”

— Sathianathan Devaraj, chairman and managing director, Grama Vidiyal, IndiaThe Campaign Commitment from Grama

Vidiyal includes:

  • organizing 720 health camps for clients and screening 300,000 members;
  • providing health education to 80,000 client families; and
  • helping 800,000 clients with its Free Meals program.

Coordinates

Microfinance providers that map the challenges faced by their clients who struggle often find that household health-related challenges form one of the primary causes of business failure. A sick proprietor cannot run a business, and a severely sick child can deplete accumulated family assets with payments for medical care.

Health providers that map the usage rates of their health services often find that large sections of the country do not avail of their services. In many cases, these are the same areas where microfinance providers operate.

Comparing maps, like those in figure 5, can help pinpoint where to implement an integrated health and microfinance program. Loan officers and savings group facilitators can be trained to deliver educational messages to women about health issues, such as nutritional foods to consume in order to prevent or treat anemia.

Roles

As MFIs participate in the goal to eliminate extreme poverty by 2030, they will need to develop strategic, coordinated partnerships with other sectors to help address the many dimensions of poverty faced by their clients, especially as it relates to healthcare. MFIs can provide some health services on their own (e.g., health education and health financing products). To reach scale with health services, however, they will also need to partner with others who provide direct health services, health insurance, and healthcare products.

Evidence

When it comes to addressing healthcare needs of microfinance clients and their families, there is much for us to learn from the last 15 years pursuing the MDGs. Evidence from a series of studies published in 2014 by the World Health Organization (WHO) identified success factors for achievements in maternal and child health (MDGs 4 and 5).[10] One of these studies shows that 50 percent of the reduction in the mortality of children under five years of age resulted from “health-enhancing investments in other sectors.” These factors include improvements in safe drinking water and sanitation, increases in women’s incomes, reduction of fertility rates, and increases in children’s school enrollment.[11] This is good news for MFIs and other financial service providers with a mission to improve their clients’ lives. Their efforts to improve women’s outcomes plus their efforts to develop cost-effective integrated health and microfinance interventions have potential for important follow-on effects. Unsurprisingly, these studies credit a strategic, coordinated approach across sectors for the gains seen in MDGs 4 and 5.

A recent study[12] conducted by the Microcredit Summit Campaign in collaboration with MAVIM, a partner implementing integrated health and microfinance services in India, shows an improvement in awareness and positive behavior change regarding healthy habits practiced to prevent non-communicable diseases, such as diabetes, hypertension, and cancer. For example, MAVIM showed that awareness by its SHG members about consumption of fruits and vegetables increased from 46 percent and 83 percent, respectively, to 98 percent (for each); and their change in patterns of consumption nearly doubled from 42 percent at baseline to 81 percent at the end line.

In addition, the provision of health-related services can improve an MFI’s relationship with its clients, who greatly value these services. A longitudinal impact study of Bandhan’s health program from 2008 and 2013 reported important improvements in health outcomes for mothers and children alike, such as increased breastfeeding rates and greater use of oral rehydration solutions for treatment of diarrhea. It also reported high satisfaction levels with the health program: “Clients repeatedly expressed that they felt as though Bandhan cared about their health.”[13] These are some of the specific responses:

  • 77 percent of the 36 participants interviewed qualitatively in 2013 (five years after the start of the program) felt positively about their involvement with Bandhan.
  • 64 percent of participants would not be able to cover medical expenses with their current finances if they faced a major illness, but they were willing to use a Bandhan health loan if necessary.
  • 17 percent of participants reported having taken out a health loan, but many who did not seek a loan expressed concern over their ability to repay it.
  • The health education forums “were the most valuable part of the program, while others highly valued the services and knowledge of the SS” (Swastha Sahayikas, health product distributors).[14]

Examples

The Campaign has worked to help cultivate partnerships between MFIs and health providers over the past five years. As part of these efforts, our “Healthy Mothers, Healthy Babies” project[15] in the Philippines aims to deliver health education via group meetings and increase access to maternal healthcare through health fairs. CARD and Freedom from Hunger set a target to provide training with their “Healthy Pregnancies Make Healthy Communities” initiative to more than 600,000 women by the end of 2015. They met that target early and are on track to reach 1 million women by the end of the year. CARD is also working with the Microcredit Summit Campaign to mobilize strategic partnerships among MFIs, health providers, government agencies, and local funders (e.g., family foundations and CSR divisions within corporations) in order to secure an ongoing support base for a consortium of 21 MFIs called MFIs for Health.[16]

Figure 6: The Celebrity Couples of Maternal and Newborn Survival

Figure 6_The Celebrity Couples of Maternal and Newborn Survival_EN full

Source: L. Greenslade, 2014, “Partnering beyond the Health Sector for Maternal and Newborn Survival,” PowerPoint presentation (New York, NY: MDG Health Alliance)”

Leith Greenslade, vice chair of the MDG Health Alliance, refers to these uniquely powerful partnerships across sectors as “celebrity couples”—pairs of interventions that have a proven correlative relationship to leverage their respective impacts. They are the secret to achieving the MDGs and, by extension, the SDGs. As Leith explains, “If we know that we can accelerate achievement of health goals for women and children by investing in toilets, contraception, education, roads, electricity, water, and women’s incomes, why don’t we see more partnerships beyond the health sector? Why do single disease (e.g., AIDS) and single intervention (e.g., vaccines) investments still proliferate? Why are we not building health systems that harness the power of these cross-sector relationships?”[17]

Figure 7: MFIs Offering Health Products and/or Services
(December 31, 2009−December 31, 2012)
Figure 7_MFIs Offering Health Products and-or Services_EN full

Click to enlarge

Figure 8: Types of Health Products and Services Offered
(December 31, 2011, and December 31, 2012)
Figure 8_Types of Health Products and Services Offered_EN full

Click to enlarge

The microfinance sector has an opportunity, by making this a key strategic piece of service design and delivery, to improve the lives of their clients. MFIs occupy a critical place in between the healthcare demand and supply, enabling them to play a role in creating linkages between the two. They meet with millions of low-income women in rural areas every week and have built relationships of trust with their clients; enabling them to provide health education, health financing to clients, and linkages to health providers at a reduced cost.

Our data show greater numbers of MFIs taking on this challenge. In figure 7, almost half report providing health education to their clients, with significant percentages also providing health insurance and other non-financial health services (see figure 8).

Freedom from Hunger—a leader in designing integrated health and microfinance solutions, with which we work in India and the Philippines—and its network of 30 MFIs currently reach nearly 3 million families around the world. In India, 19 Indian MFIs reported in a survey in 2012 that nearly one in four of their clients—3.9 million families—had access to a health program in 2011.[18]

The health-related services provided or coordinated by MFIs take many forms:

  • Health education: offered via short lessons in groups meetings covering healthy habits and disease prevention techniques
  • Health fairs: bring health professionals together to provide health screenings for microfinance clients and their family members
  • Health financing: provides health insurance, health savings accounts, and emergency health loans
  • Telemedicine: allows MFI branch offices to provide health screening through a computer video link with a hospital
  • Local community health workers: trained and financed by MFIs.

Action

Financial service providers: By providing health financing and education, and by linking with health providers, the microfinance sector improves knowledge, effects positive behavior change in relation to health, and helps families afford curative and preventive healthcare. Further, it addresses both a shortage of health providers through the provision and coordination of their own community health workers in these vulnerable communities, as well as the problem of distance by bringing healthcare closer to such communities.[19]

Government health ministries and other health providers: Linking with MFIs with extensive outreach will expand access and usage of health services. Health shocks and the resultant expenses are the primary reason families fall into—or sometimes back into—poverty. Therefore, the delivery of health services and health-related financial tools by MFIs or direct linkages to local health actors represents a key pathway out of extreme poverty for their clients.


← Previous: 2015 Report > The Next Wave Next: 2015 Report > Infographic: Integrated Health and Microfinance →

Table of Contents

  • Executive Summary
  • Where’s the Map?
  • Global Data Show Diverging Paths
  • Integrated Health and Microfinance
  • Saving Groups
  • Graduation Programs
  • Agricultural Value Chains
  • Conditional Cash-Transfer Programs
  • Digital Finance
  • Conclusion
  • Data
  • Multimedia
  • Read the Full Report (Coming soon!)
  • Get Your Copy
  • Français (Coming soon!)
  • Español (Coming soon!)
  • Arabic (Coming soon!)

Where’s the Map?

December 8, 2015 · by virgiliakasbarian2014
“A map does not just chart, it unlocks and formulates meaning; it forms bridges between here and there, between disparate ideas that we did not know were previously connected.”
― Reif Larsen, The Selected Works of T.S. Spivet

How does BRAC, the world’s largest non-governmental organization (NGO), develop pathways out of poverty for the poorest people in a village? They begin with a map. As you see in the photo on the cover of this report, they bring the village together and start drawing maps in the dirt, identifying each household, market, business, and place of worship. They then ask the help of the community to identify the poorest households, marking each one on the map. Their work begins with those households.

This painstaking, household-by-household approach of identifying the excluded and locating them within their community and context represents the next step that we need to take to achieve a new set of ambitious global development goals.

The Millennium Development Goals (MDGs) set by the United Nations aimed at cutting world poverty in half by the end of this year. By some measure, that goal has been achieved, although primarily through large reductions in populous Asian countries offsetting much more modest reductions in other parts of the world. UN member states recently approved a new set of 17 objectives, the Sustainable Development Goals (SDGs).[5] The first SDG calls for the end of extreme poverty by 2030.

The World Bank Group shares in this goal. Bank President Jim Kim has focused the work of his institution around two goals: 1) end extreme poverty by 2030 and 2) boost shared prosperity among the 40 percent of the poorest people in low- and middle-income countries. The Bank has also established a goal of achieving universal financial access by 2020 as one means of supporting the 2030 goals.

At the Microcredit Summit Campaign, one of our key roles has been to work with the microfinance community to set global goals. We first sought to reach 100 million of the world’s poorest families with microcredit and other financial services. When the microfinance community reached these targets 10 years later, we set two new goals: 1) reaching 175 million of the poorest families with credit for self-employment and other financial and business services, and 2) helping 100 million families lift themselves out of extreme poverty.[6] This report presents the performance of the global microfinance community against these goals.

The report also describes something that the global development community has proven less adept at: drawing maps that show how—and where—a variety of disparate organizations can work together to achieve the goals. The uneven performance of many countries in realizing the MDGs demonstrates this clearly. According to the 2015 MDG report, we know that the performance was especially uneven between urban and rural areas. Without maps to show who needed to be reached to achieve each goal, and what facilities and resources would be required to meet them, countries missed reaching large segments of their population with their MDG plans.

The numbers we report here on microfinance outreach reveal a similar story. While the total number of microfinance borrowers served worldwide continues to recover and grow, following a setback in India in 2010 (due to the Andhra Pradesh crisis), the number (as measured) of poorest clients reached continues to shrink. Without mapping where these potential clients live and work, and without developing effective strategies to provide them with products and services appropriate to their needs and aspirations, we will not reach our goal of seeing 100 million families move out of extreme poverty.

Those who want to reach audacious goals need to draw a map of how to get there. We learned this from the governments of Ecuador and Ethiopia. In Ecuador, the vice president’s office has made a goal of ensuring that the country includes all persons with a disability (PWDs) in the national plans and economic life of the community. One step in achieving this goal involved the development of disaster preparedness strategies that include emergency evacuation plans for all PWDs. This required working with enumerators to identify the household of each PWD, then creating a plan for evacuating that person in the case of a disaster.

The government of Ethiopia set a goal of making its land and its people less vulnerable to drought. To achieve this goal, the government mapped out the number of people living in vulnerable areas and worked with their communities to understand the factors that created vulnerability and develop solutions to increase resilience. They developed a massive Productive Safety Net Program (PSNP) that reaches over 10 million people and has helped reduce the poverty level in Ethiopia from 56 percent to 31 percent (2001–2011).[7]

Maps also help us identify who might be left out. They also help us make connections between factors that might seem unrelated to each other. The map drawn by John Snow in 1855 provides one of the most famous examples of this. The city of London faced a cholera epidemic in 1854. At that time, the most popular theory claimed that people caught cholera through miasma, or breathing infected air.

Snow had a different concept and drew a map to prove it. In his map of the Soho neighborhood, Snow used a bar to depict the location of each person who had died of cholera. Then, he identified each of the water pumps in the neighborhood with lines encircling all the homes that used each pump. His map clearly demonstrated that almost all the people who died had been using the same water pump. The neighborhood council responded to his map with swift and decisive action: they took the handle off the pump and brought an end to the epidemic.

Mapping the people who remain excluded from financial services can help us make connections that may be interlinked:

  • The overlap of those needing access to financial services and those needing access to better health care, housing, nutrition, and education
  • The connection between those lacking financial services and those earning a large portion of their income through agriculture
  • The link between exclusion and gender in financial services, and the need to develop financial products appropriate to the needs and aspirations of women
  • The need to place aggregators and agents in the right locations to make sure that digital financial services reach those living in extreme poverty
  • The great masses of people fleeing from instability and destruction of their homes, and their need for tools to help them communicate with family and send and receive money wherever they may end up
  • The link between those in poverty receiving conditional cash transfers from their government and those who need access to savings and credit facilities, financial capabilities training, and livelihood support.

The Center for Financial Inclusion, through its FI2020 program, has done the most work to date to develop the financial inclusion map. After interviewing more than 300 financial service practitioners, they developed their “Roadmap to Inclusion.” It identifies five key focus areas for reaching full financial inclusion (addressing customer needs, technology-enabled business models, financial capability, client protection, and credit reporting). Their Roadmap provides a set of instructions for expanding the outreach of financial services. In their recent progress report on the Roadmap, they gave the “addressing customer needs” focus area one of the lowest scores (3 points out of 10):

The test for financial inclusion should be whether the lives of the newly included are improved. However, access to an account does not improve lives if the account sits idle. Accounts are only a first step. The large and, we believe, growing access-usage gap, coupled with a lack of attention to services beyond payment accounts, prompts us to give this area a relatively pessimistic score of 3.

In reviewing recent progress, we found good news on access, but a bleak picture of usage. Despite mobile money’s glowing headlines, 68 percent of registered mobile wallets had not been used during the last 90 days, according to GSMA.[8] Similarly, the Findex revealed that, while saving and borrowing trends indicate increased financial activity, this is not reflected in the uptake of formal products. And while data on microinsurance uptake is sparse, it is still a hard sell for much of the world’s underserved. The barriers often cited to explain low usage include poor product design, lack of consumer knowledge about how to use products, frustration with operational failures, and inept customer care, among others.[9]

This points to another key value of maps: they help us start from our end goal and work back to how we want to get there. Maps help us focus on where we want to be and what we need to learn to get there. Without making and using maps, we may proceed down dead-end roads.

The Microcredit Summit Campaign has demonstrated this lesson. We have promoted microfinance as a tool for reaching the poorest families and helping them move out of poverty. The evidence from academic studies and our own analyses show that, without a very clear focus on that goal and a roadmap for achieving it, microfinance will miss the mark of realizing its potential to contribute to the elimination of extreme poverty.

In this report, we begin the effort of drawing a map to show how universal financial inclusion can support the goal of ending extreme poverty. We have identified six “pathways” that reach the poorest families to help them reduce their vulnerabilities and take advantage of opportunities. With each pathway, we also include maps that illustrate where the pathway can reach and who will have access to its resources. We also provide an example in each chapter of a Campaign partner that has launched a Campaign Commitment to take specific, measurable, and time-bound actions to support the particular pathway objective.

Our work that we describe here is incomplete, even though it identifies clear calls to action. Our maps still contain many blank spaces, terra incognita, where we still do not know the best approach or the right connection points.

This brings us to another value of maps, especially incomplete ones. They inspire adventurers and explorers to fill in missing spots, to blaze trails where none have existed before. In the same way that the crude drawings by ancient seafarers motivated others to go further and develop more precise atlases, we hope that our rudimentary attempts in this report contribute to the development of a new type of GPS system that charts the best routes out of poverty for the world’s poorest families.


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Table of Contents

  • Executive Summary
  • Where’s the Map?
  • Global Data Show Diverging Paths
  • Integrated Health and Microfinance
  • Saving Groups
  • Graduation Programs
  • Agricultural Value Chains
  • Conditional Cash-Transfer Programs
  • Digital Finance
  • Conclusion
  • Data
  • Multimedia
  • Read the Full Report
  • Get Your Copy
  • Français (Coming soon!)
  • Español (Coming soon!)
  • Arabic (Coming soon!)

Client Videos

November 11, 2012 · by RESULTS Educational Fund

Conchita’s Story

Growing up in Central Luzon, Philippines, Conchita Quintero was not able to complete her schooling. Working all day at home doing laundry, Conchita vowed that she would help her children. When she first met with employees of Alalay Sa Kaunlaran, Inc. (ASKI), a Filipino microfinance provider, Conchita and her children were living on less than US$1.25 a day. Learn more.

Watch VisionFund Cambodia client Meas Samel’s story.


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    citi_foundation_r_w_rgb This report has been made possible by a generous grant from the Citi Foundation.
  • About the Campaign

    From 1997 to 2016, the Microcredit Summit Campaign was the largest global network of institutions and individuals involved in microfinance. A project of RESULTS Educational Fund, the Campaign led a movement in the microfinance industry to achieve two bold goals by 2015: 1) reach 175 million poorest families with microfinance and 2) help lift 100 million families out of extreme poverty. www.microcreditsummit.org

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