FinTech in developing countries is generally presumed to be pro-poor, while in wealthier countries there is more skepticism that digital innovations will advance inclusion for the poorest in society. Why is that? What are appropriate expectations of FinTech innovation? Should we be more skeptical of FinTech in countries with large inclusion gaps? Should we be less skeptical of new business models and tech-enabled services in wealthy countries? Join Tim Ogden, Managing Director of the Financial Access Initiative, as we discuss the expectations and potential of FinTech to increase inclusion with an expert panel from around the world.
Read MoreThe Twilight Zone Edition
Editor's Note: When people (OK, a person; Hi Jeff!) starts checking on your safety since it's been so long since you've written the faiV, it's definitely time to bend the dimensions of space and time and finally get another one out. The last faiV turned into an extended rant on financial literacy. Here's a long overdue post on why I'm not convinced by the latest systematic review of finlit interventions, which claims evidence of impact on behavior.
–Tim Ogden
1. Digital Finance: First things first. The next faiVLive is coming up on June 23rd, and the topic will be the FinTech Expectations Gap. What's that you ask? Well, it comes from my obsession with the Great Convergence and domains where perceptions aren't converging. FinTech is one of those places. I've noticed that, in general, FinTech innovation is generally viewed as pro-poor in developing countries, but very skeptically in wealthier countries. So I'll be moderating a discussion of whether that's accurate, if those perceptions are justified, and whether there is a holistic framework for assessing whether digital finance innovations are pro-poor that applies across contexts. Joining me will be Yinka David-West, Tim Flacke, Tavneet Suri, Barbara Magnoni and Lois Bruu. Join us.
Goodbye to Financial Literacy Month
This post is co-authored by Timothy Ogden and Julia Brand.
Why April 2021 should be the last Financial Literacy Month, and what we think should replace it.
Your Gender Profit Gap Questions Answered
What should we measure (besides profits) to better understand business success? Wy do women choose some sectors over others?
Read MoreAre Complaints the True Voice of the Customer?
Complaints – whether expressed on social media or through formal grievance redress channels – are transparent windows into what consumers are thinking and experiencing. They are a critical source of information for protecting consumers, but they require care in interpretation and response.
Read MoreTrust, Trade-offs & Metrics: Three Takeaways from the Gender Profit Gap Literature
Last week FAI hosted a webinar on the Gender Profit Gap to talk about why women’s businesses are smaller, grow less, and earn less, than men’s businesses. Below, some reflections from the literature on what can be done to empower women entrepreneurs.
Read MoreThe Wage Garnishment Edition
Editor's Note: I didn't start writing this faiV as an extended rant about financial literacy. It just sort of happened.
Read MoreFAI in the News: The case for cash grants
A growing number of cities across the United States are testing out guaranteed income pilots, which give regular sums (between $100 - $1000) to primarily low-income residents. As USA Today reported on March 4, these pilots are a part of a wider discourse that supports guaranteed income as a mechanism to fight income instability, wealth inequality for low-income families, and to protect against unexpected shocks such as COVID-induced unemployment. “Guaranteed income has become more critical in the longer-term as the nation’s gig economy spawns a growing population of freelance and contract workers who don’t receive benefits and whose income fluctuates from week to week,” said FAI’s Executive Director Jonathan Morduch, who is part of the research team designing a pilot in Compton, California.
Read MoreAccounting for the Gender Profit Gap
In countries across the world, women earn less than men. This is true not only for wage-paying jobs, but also for the earnings of micro and small businesses, which play a prominent role in most economies. Women-led businesses are less profitable than their male counterparts, have fewer employees, and are less likely to grow. In this webinar, we discuss what we have learned form research and experience that can help policymakers, financial service providers, and other organizations better meet the needs of women, and close gender gaps in small firms.
Read MoreLinks and Resources | faiVLive: Accounting for the Gender Profit Gap
Welcome to Accounting for the Gender Profit Gap, with Nava Ashraf, Morgan Hardy, and Tatiana Rincón, and moderated by Tim Ogden. Join the faiVLive webinar, or register to watch a recording when the webinar is over, here. Here’s some key research that we’ll be discussing in the webinar.
Read MoreRegister Now | faiVLive: Accounting for the Gender Profit Gap
Join us on Tuesday, March 2 as we bring together leading experts to explore innovative research around the reasons behind gender differences in the profitability and growth of small firms, and ways to better meet the needs of female entrepreneurs.
Read MoreThe 3rd Gen Edition
Editor's Note: TL;DR: The faiV has been missing because of a combination of launching a big new research project and some changes that we'll be making based on feedback from readers, but I'm back now.
Also, register here for the next faiVLive, "Accounting for the Gender Profit Gap" with Nava Ashraf, Morgan Hardy and others on March 2nd.
–Tim Ogden
FAI in the News: Mobile money and migration
A recent experiment by researchers Jean N. Lee, Jonathan Morduch, Saravana Ravindran, Abu Shonchoy, and Hassan Zaman studied the interplay between rural-to-urban migration in Bangladesh, and the introduction of mobile banking to modernize remittances.
Read MoreFAI in the News: COVID-19 and the Great Reverse Migration
Between March and May of 2020, millions of urban workers across Bangladesh, India, and Pakistan lost their livelihoods and were forced back to their villages. “We may look back at this moment as The Great Reverse Migration,” wrote the authors of a study that tracked the relationship between these migration patterns and the spread of the virus.
Read MoreWhat’s in It for Them? Convincing Digital Lenders to Protect their Customers
Why should digital lenders support consumer protection principles and practices? What’s in it for them? After a decade of experience with digital lending, it’s high time to answer this question.
Read MoreCash Flows vs Balance Sheets: How to Think about Short-term Savings
Last week’s edition of the faiVLive—co-presented with the Aspen Institute Financial Security Program—brought together researchers and practitioners to look at how low-income households use short-term savings, and what formal and informal financial tools and product features can help them achieve their savings goals.
A short recap of some highlights follows, but if you missed the webinar, you can still watch it HERE.
Read MoreHow Low-Income Households Save—And Can We Help?
This edition of faiVLive—co-presented with the Aspen Institute Financial Security Program, brought together researchers and practitioners to look at how short-term savings work and don’t work, with a particular eye to whether and how savings for low-income households can be boosted.
Week of October 23rd, 2020
Editor's Note: There are several webinar links below, but let me start with a couple that are upcoming and worthy of note. On October 28th, we'll have the next edition of the faiVLive, focused on savings—specifically, what we've learned about how poor households save, and how much we still don't know about how to effectively support savings. I'll be joined by Jonathan, as well as Jessica Goldberg (development economist at UMd), Gen Melford (Aspen Institute's Financial Security Program), and Jonathan Lee (Neighborhood Trust Financial Partners). As the guest list implies we'll be talking about this from both a US and developing country perspective. Register here.
Also, if you're from the development wing of the faiV readership, don't forget to register for virtual NEUDC, coming up November 6 and 7.
Since so many of you were very interested in my links questioning resilience a few weeks back, and since I don't have space for another item in this edition, here's what looks like a great new paper: A Scoping Review of the Development Resilience Literature: Theory, Methods and Evidence (short version: resilience is too ill-defined as yet to be all that useful).
Oh, and I missed you.
–Tim Ogden
Finclusion Week: Microfinance Impact from Bangladeshi Villages to Urban New Jersey
In the last 10 years researchers have generated a large handful of microfinance impact evaluations—mainly from countries in the southern hemisphere and mainly using RCT methods. In this 30-minute live video chat, Jonathan Morduch and Tim Ogden of FAI discuss connections between the studies, including the latest findings from the U.S.—a randomized evaluation of the Grameen America microcredit program in New Jersey. What can we learn from these findings? How do they shape expectations for new programs? And what do we learn for the role of microcredit in the financial lives of low-income households? Watch the recording here.
Read MorefaiVLive: How Low-Income Households Save—And Can We Help?
Savings has traditionally been measured by asking about “account” balances, or in national accounts by comparing incomes to expenditures. But we know that low-income households often save actively. They build up and draw down their funds throughout the year—what Nobel Laureate Angus Deaton termed “high frequency savings”—even if their balances don’t grow. Watch the recording here.
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