April 17, 2015
1. Commitment Savings: FAI's Managing Director Timothy Ogden discusses the world’s largest and most successful commitment savings program for low-income households - the US tax system. Stanford Social Innovation Review
2. Financial Inclusion: The number of "unbanked" individuals dropped 20% between 2011 and 2014 to 2 billion adults,...
April 17, 2015
Over at CGAP, Julie Zollman has a terrific post on M-Shwari, the Kenyan borrowing and saving platform built on M-Pesa, examining the underlying customer needs that have led to M-Shwari’s success. Here’s a key passage:
The appeal [of M-Shwari] was the possibility of being able to borrow on demand, in real time, to stretch families’ ability to make ends meet in the short term. M-Shwari offered liquidity bigger than credit from local shops; faster, more private, and more...
April 16, 2015
The third study for our spotlight on current microfinance research is a working paper by Afzal et al. presented at the 2014 NEUDC which delves into the similarity between savings and credit products. The authors conduct a lab experiment among women in rural Pakistan who are or have been microfinance clients.
The experiment runs in three sessions...
April 14, 2015
Tim is worried about the state of microcredit research, particularly research on product innovation, in the aftermath of the six microcredit evaluations published in the January edition of the American Economic Journal: Applied Economics. (For an overview of reactions, see our special edition of the FAIV.) That prompted me to explore the microfinance research...
April 10, 2015
1. Digital Payments: A body of research contains evidence that people spend more with credit cards than cash because the former reduces the "pain of paying." Do mobile wallets like Apple Pay increase or relieve this pain? The Atlantic
2. G2P Transfers: The US doesn't drug test farmers receiving crop subsidies or requirePell Grant...
April 9, 2015
We often talk about how access to financial instruments may complement entrepreneurship. Financial instruments such as vehicles for savings and loans may help to encourage entrepreneurship and investment by making it possible for individuals to make larger investments and to hoard returns for the future. Less has been said about the interaction between financial access and wage work, but a recent paper by Michael Callen, Suresh De Mel, Craig McIntosh and Christopher Woodruff shows, perhaps surprisingly, that a...
April 3, 2015
1. Microfinance: FAI’s Jonathan Morduch discusses the limitations of microfinance, the promise of new technologies, and the need for quality, effective financial services for the poor. The Wall Street Journal
2. Student Debt: A burgeoning student loan repayment strike is gaining attention from the US government. It bears a striking resemblance to microcredit repayment crises...
March 27, 2015
1. Ultra-Poor Programs: A newly published paper from Jonathan Bauchet, Shamika Ravi, and FAI's Jonathan Morduch looks at "ultra-poor" programs and how labor markets affect outcomes. Journal of Development Economics (paywall)
March 20, 2015
1. Savings Groups: In an evaluation of savings group outreach programs in Kenya, NGO-led groups had better attendance rates, saved more, had larger payouts, and lower rates of reported loss than groups formed spontaneously. FSD Kenya
2. Mobile Money: Kenya may be the current media darling when it comes to mobile money, but Tanzania's success story is due for its share of the spotlight. ...
March 20, 2015
Financial Access Initiative
This week, The Wall Street Journal featured a pair of articles on current issues in microfinance. The first highlights the varied strategies governments across Asia are employing to promote financial inclusion, including mobile technologies and India's policy of universal bank accounts. However, some are concerned about the $80 overdraft feature of these accounts, and liken the potential risk of indebtedness to the past failures of microfinance. FAI's Executive Director Jonathan Morduch notes that indeed, microfinance's impact on poverty alleviation...