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Digital solution Tienda Pago provides working capital for Cecilia and other small merchants in Latin America 

Article

Cecilia Polanco Tueros is a picture of resilience.

Even before the pandemic, she was no stranger to overcoming adversity. After a bad robbery, her family lost everything and went bankrupt. Her husband had to seek out a new job where he could bring in more income, and Cecilia took over the corner store that had previously been run by her mother-in-law.

Running her store keeps her busy every day, but she’s always working to balance the needs of her business and her family. While her three sons are now in their teens and twenties, Cecilia still makes time to be in their lives as much as she can — stepping away from the store to make breakfast for everyone and reconvening the family for lunch each day. She takes particular care to be there for her oldest son, who has Autism Spectrum Disorder. Before the pandemic, she arranged for him to get the therapy and support he needed over the years, and she is proud of the independent young man that he’s growing into. Being able to work close to home and tend to her family’s needs is important for Cecilia since she has to work such long hours, from before sunrise until late into the evening.

Cecilia and her family quickly felt the effects of the pandemic when it reached them in Lima, Peru. “COVID-19 was and still is very hard on us, as a family and as a business. Thank God neither me, nor my immediate family got infected. Sales are down, people are not coming as much, and they do not have money to spend,” she says. Though her store sells food and everyday essentials, many people in her community are struggling and buying less.

One thing that’s helping her manage while her sales have dropped is working with Tienda Pago. Accion partner Tienda Pago provides working capital for small merchants in Peru and Mexico so they can manage their inventory needs without being at the mercy of cash flows. This allows them to buy what they need and take advantage of busy times to sell more merchandise and grow.

“Tienda Pago is a solution,” says Cecilia, a smile breaking over her face. “It’s like a salvation, you might say!” She wasn’t so sure about trying it at first — “I hate taking a bank loan. I never do it,” she explains. But with Tienda Pago, the credit is so short-term she repays within a week and doesn’t lose a sense of control over her finances. Even though the loans are small, she’s still able to come out ahead.

Cecilia hasn’t been able to stock as many items in her store in the past year because of her decreased sales. The support she receives from Tienda Pago has helped her to stay afloat. “Tienda Pago helped a lot and keeps helping us. Tienda Pago did not charge me interest or late fees for the period we were in quarantine and not buying products.” Their team is staying in touch with Cecilia through phone calls and their digital app while they’re unable to visit in-person during the pandemic. <a href="https://www.accion.org/what-it-takes-for-one-family-business-to-stay-open" target="_blank" rel="noopener noreferrer">Tienda Pago is focused on helping small shop owners</a> like Cecilia through this crisis so they can stay in business long-term.

While Cecilia is still fighting to get through the challenge of COVID-19, she’s holding onto her dreams for the future. Access to working capital opens opportunities for small business owners to endure challenges and grow when sales rebound. Since she began using Tienda Pago’s services, Cecilia has found she can stay afloat during difficult times, and when things are good, she can order more merchandise for the shop and have money to spend on the things her sons need. Her oldest son has taken workshops to help him gain more skills and independence, her middle son has begun working as a dental technician, and her youngest is doing well in high school. “I want to grow, I want to expand,” she says, looking ahead to the future. Her dreams are growing bigger, too, as she envisions college degrees and professional careers for her sons, and hopes they’ll be able to support and take care of each other. Cecilia’s store is more than a job; it’s a pathway to a better future for her entire family.

A family business offers renewed hope and resilience

Michael Schlein

Financial service providers must stay focused on customers as they quickly embrace digital tools.

The pandemic has severely affected the world’s low-income populations. But by accelerating the pace of digitization, it has opened doors to financial services and the security and opportunities they provide. Digital financial services—and the tools needed to use them—are now vital for low-income families and small businesses to make it through this crisis and build resilience to future challenges.

Digitization is integrating financial services into nearly every aspect of life. <a href="https://www.accion.org/what-does-embedded-inclusive-fintech-look-like">Financial services can be embedded</a> into anything from utility payments to crop fertilizer subscriptions, which can help more people access credit, save money, and build credit histories that are essential for growth.

But digitization also risks worsening inequality, invading clients’ privacy, and taking advantage of people with less digital experience or poor access to the right tools, like mobile phones. Underserved people need new skills and expertise to successfully navigate the digital economy, and they need products that protect their privacy and personal information.

Accion has been working to ensure that innovations driving digital transformation and migration are inclusive, safe, and effective. Based on our experiences, here are three ways to ensure customers aren’t left behind amid accelerating digitization.
<h2>1. Expand digital access, fluency, and trust</h2>
Building customers’ trust in digital financial services, as well as their digital fluency, will be foundational an effective customer experience. It matters less where clients live, while it’s more important that providers can reach and stay in contact with them. Financial services providers need to rethink the purposes of physical interactions versus digital interactions so that the former occur less often and the latter become more frequent and more personal.

EdTech (education technology) can help underserved clients gain digital familiarity and learn how to accomplish a range of tasks, like setting up an online wallet or listing a product for sale. Accion has <a href="https://www.accion.org/how-the-pandemic-is-spurring-microentrepreneurs-to-go-digital">developed and deployed an interactive EdTech platform</a> called Ovante to help underserved entrepreneurs gain the management, financial, and digital expertise they need to succeed in our increasingly digital world. Ovante can help clients expand on their existing knowledge of social media to open new digital channels to selling their products and services.

Digital channels are a key conduit for financial service providers to improve their customer experience, and sometimes this means totally rethinking the customer experience. For example, many of Accion’s partners use group lending models to serve clients without any credit history by allowing people in the same communities to guarantee each other. Eighty percent of group lending participants are women, and 65 percent live in rural areas with few or no banks. Group lending has historically relied on frequent in-person interactions. But as social distancing became a necessity, our partners leveraged digital platforms to <a href="https://www.accion.org/can-group-lending-work-in-a-socially-distant-world">reimagine the group lending process</a> for the digital age.
<h2>2. Answer clients’ needs</h2>
As lockdowns end, low-income families will find their savings exhausted, their businesses stalled or bankrupt, and their future incomes uncertain. People will need new income streams and financial services to build resilience, restart their businesses, and establish new ventures.

Digitization means that more clients will use digital tools to rebuild their livelihoods, but providers must answer their needs by <a href="https://www.accion.org/to-succeed-innovative-financial-products-must-be-desirable-feasible-and-viable">crafting truly meaningful, customer-centric value propositions</a> that help them build resilience today and for the future.

To do that successfully during the pandemic, Accion has helped providers conduct interviews and surveys remotely to ensure that they capture the insights they need. Using client insights, we help institutions develop products and services that are desirable to clients and solve their specific problems. These offerings must also be feasible for the institution, given their capacity and operating models, and viable for the long term. Here, digital channels and platforms make a huge difference, and adopting them has become an urgent priority.

It’s so important to help people build financial resilience, and the customer experience needs to reflect that. If vulnerable clients’ unique needs aren’t sought out, understood, and addressed, their entire livelihoods could collapse and the economic recovery will be more difficult. Financial service providers must <a href="https://www.accion.org/win-from-within-how-fintech-startups-can-grow-by-building-value-for-existing-users">grow along with their clients</a> by understanding their needs, crafting products that meet those needs, and keeping them engaged throughout their journey as customers.
<h2>3. Ensure clients’ data and privacy stay protected</h2>
Digitized data can unlock more personalized and effective financial products that can help low-income people improve their lives and achieve their goals. Yet many emerging markets have weak effective consumer data protection regimes. When rules do exist, people with low levels of digital and financial sophistication may, in their eagerness to receive financial services, sign away their rights without even fully understanding them.

Protecting the privacy and security of customer data includes cultural and technical aspects, and vulnerabilities often lie at the intersection of the two. A provider can install best-in-class privacy and security software, but they must also build in privacy through a culture of protecting customer data. For example, providers can ‘right size’ their data collection methods to focus only on what is needed, implement strong and ethical data governance policies, and have dedicated staff responsible for their consistent application and use.

Accion is also focused on increasing transparency in providers’ data practices. We are analyzing how financial service providers use algorithms, which can be biased against underserved populations, in automated decision-making. We are monitoring emerging frameworks around the world to see what does and doesn’t work to advance financial inclusion while safeguarding data privacy, portability, and other consumer rights.

Cyber threats have also become a growing concern in emerging markets. Digital innovations, new products, and new processes are moving ahead at breakneck speed, but they’re leaving cyber security considerations in the dust, bringing new risks to financial inclusion-focused providers and to low-income and newly-banked customers. This makes it harder for people to trust digital financial services. We are working with our partners to <a href="https://www.accion.org/reimagining-cyber-risk-for-financial-inclusion-in-an-increasingly-digital-world">put in place cyber risk mitigation strategies</a> to ensure that the most underserved are protected.

Accion is engaging the industry to ensure that innovation doesn’t simply expand access to financial services—but also creates financial services that are safe, high quality, and designed to meet customers’ needs. These efforts are essential to ensure that the world’s three billion financially underserved people can build resilience to today’s challenges and threats arising in the future.

Three ways to ensure people aren’t left behind in the rush to go digital

Speakers

<h2>Español</h2>
Las mujeres han sufrido desproporcionadamente las consecuencias económicas de la pandemia, por lo que es vital garantizar que las innovaciones en productos y servicios financieros las apoyen y no las dejen aún más abandonadas. ¿Cuál es el papel de los datos para que esto ocurra? ¿Cómo pueden los proveedores de servicios financieros aprovechar el poder de los datos para eliminar los prejuicios y diseñar y ofrecer productos y servicios que aborden específicamente las necesidades de las mujeres? Escuche a los líderes de tres proveedores de servicios financieros y fintechs sobre los éxitos y retos que han enfrentado al recopilar y analizar datos para nutrir el diseño, el marketing y la entrega de productos de manera que aborden específicamente las necesidades en evolución de las mujeres durante la pandemia de COVID-19. Esta sesión estará disponible en español e inglés.

In this webinar, hear from leaders of three financial service providers and fintechs about the successes and challenges they’ve faced leveraging data to address the evolving needs of women during the COVID-19 pandemic.

Webinar

[embed]https://vimeo.com/519751496[/embed]

Women have shouldered a disproportionate share of the pandemic’s economic fallout, making it vital to ensure that innovations in financial products and services support them and don’t leave them further behind. What is the role of data in making this happen? How can financial service providers leverage the power of data to tune out bias and design and deliver products and services that specifically address women’s needs? Leaders of three financial service providers and fintechs discuss the successes and challenges they’ve faced gathering and analyzing data to inform product design, marketing, and delivery in ways that specifically address the evolving needs of women during the COVID-19 pandemic.

<hr />

<h2>El uso de datos para abrir oportunidades a las mujeres</h2>
[embed]https://vimeo.com/519953867[/embed]

Las mujeres han sufrido desproporcionadamente las consecuencias económicas de la pandemia, por lo que es vital garantizar que las innovaciones en productos y servicios financieros las apoyen y no las dejen aún más abandonadas. ¿Cuál es el papel de los datos para que esto ocurra? ¿Cómo pueden los proveedores de servicios financieros aprovechar el poder de los datos para eliminar los prejuicios y diseñar y ofrecer productos y servicios que aborden específicamente las necesidades de las mujeres? Escuche a los líderes de tres proveedores de servicios financieros y fintechs sobre los éxitos y retos que han enfrentado al recopilar y analizar datos para nutrir el diseño, el marketing y la entrega de productos de manera que aborden específicamente las necesidades en evolución de las mujeres durante la pandemia de COVID-19.

How can data open opportunity for women during and after COVID-19?

Robin Brazier

Women are bearing the brunt of the COVID-19 crisis, and financial service providers have a responsibility to act

Since the COVID-19 pandemic brought economies to a screeching halt in early 2020, microbusinesses around the world have been forced to close their doors and many people’s financial lives have become uncertain. However, one thing is certain — men and women who own businesses are experiencing the pandemic and the subsequent economic fallout differently, and women are bearing the brunt of the crisis. Women are more likely to <a href="https://reliefweb.int/report/world/covid-19-and-women-s-economic-empowerment" target="_blank" rel="noopener noreferrer">participate in informal, low-wage work</a> in industries that are vulnerable to disruption during the pandemic and women-owned businesses are <a href="https://data.unwomen.org/resources/surveys-show-covid-19-has-gendered-effects-asia-and-pacific" target="_blank" rel="noopener noreferrer">less likely to have the reserve funds</a> necessary to help them survive a prolonged economic shock. Entrenched gender inequalities leave women and men with different resources available to them to plan for, manage, and recover from shocks.

At the end of 2020, <a href="/how-we-work/advise/accion-global-advisory-solutions" target="_blank" rel="noopener noreferrer">Accion Global Advisory Solutions</a> conducted a survey of 2,600 microentrepreneurs in Mexico and Chile to help financial service providers understand how their micro and small business clients were faring nine months into the pandemic. The survey results provided significant insight into the challenges women-owned businesses are facing due to the pandemic. Based on the findings from our research, we’ve outlined five ways that financial service providers (FSPs) can support women as they adapt their business and their lives during the pandemic:
<h3>1. Help women build the digital skills needed to stay resilient.</h3>
Our results found that women are nearly 16 percent more likely to be sole proprietors, while businesses owned by men are more likely to have multiple employees. Though this means women entrepreneurs may have fewer employee expenses, it also means that, even in good times, they are often managing every aspect of their businesses completely on their own. Many of these sole proprietorships who were accustomed to selling and marketing their products in person were unprepared to operate digitally. We’ve found that when micro enterprises have digitized at least part of their business, or reimagined their business altogether, they are better off during the pandemic. Edtech platforms and programs, such as <a href="/how-the-pandemic-is-spurring-microentrepreneurs-to-go-digital" target="_blank" rel="noopener noreferrer">Accion’s Ovante</a>, offer quick and easy-to-follow lessons that equip women entrepreneurs with the digital skills and confidence to move their businesses online, retain their loyal clientele, and potentially expand their operations during lockdown.
<h3>2. Incorporate “tech and touch” into products.</h3>
We know that building trust between financial institutions and their customers <a href="/in-a-no-touch-world-tech-cant-leave-low-income-people-behind" target="_blank" rel="noopener noreferrer">through human connection</a> is essential to client retention and product adoption. As many FSPs have moved their operations online during the COVID-19 crisis, they’ve risked leaving some clients behind — in particular, those who have lower levels of education and are less familiar with digital products and services. In our survey, women entrepreneurs reported lower education levels than their male counterparts, especially for technical school or higher education completion. We found that these lower education levels are correlated with greater distrust in digital financial products.

Human touch can be critical to lowering barriers to entry for these important resilience-building products, and many FSPs have found ways to cultivate personal connections with their customers despite social distancing measures. Financial service providers can utilize call centers or assisted onboarding to reach customers one-on-one to explain the value of digital products, teach them how to use them, and engage customers in a more meaningful manner. Investing in strategies that combine human interaction with technology will ensure that more women entrepreneurs join the wave of digitization. With access to and support in using digital tools, they’re better equipped to navigate the new normal, rethink or restart their businesses, and build their financial health so that they can be resilient to any future crises.
<h3>3. Prioritize savings products that meet the needs of women.</h3>
Global trends indicate that women are stronger savers than men, with <a href="https://www.findevgateway.org/paper/2020/11/gender-data-financial-inclusion" target="_blank" rel="noopener noreferrer">lower loan-to-deposit ratios</a>. At the same time, they’re also <a href="https://media-weconnectinternational-org.s3.amazonaws.com/2020/10/COVID-Infographic-Q2-Final.pdf" target="_blank" rel="noopener noreferrer">less likely to have reserve funds to help their businesses survive economic shocks</a>. Our own findings in Chile and Mexico show that the women entrepreneurs surveyed had on average 10 percent fewer reserve funds available for emergencies than men. This means that although women have a higher propensity to save, they face barriers doing so formally through savings products, making them more vulnerable during crises. To prepare their women clients for future economic downturns, financial service providers need to design savings products that specifically meet the needs of women and incentivize the opening of savings accounts. This incentivization might involve the launch of a savings product — like <a href="https://financialallianceforwomen.org/news-events/bank-al-etihad-amplifies-impact-jordanian-women/" target="_blank" rel="noopener noreferrer">Shorouq by Bank al Etihad</a> — that is coupled with a rewards program which recognizes the financial goals of women like saving for children’s education or owning a home.
<h3>4. Engage women entrepreneurs with practical advice on business survival.</h3>
During this crisis, many women are experiencing a disappearance of sales, forcing them to dip into savings to rescue their business, or take on more debt to keep their business afloat. These women entrepreneurs in our survey reported being more focused on their businesses’ survival than business growth and more likely to indicate they are exploring other sources of income or have thought about shuttering their businesses. Male respondents, though also seeing disappearing sales, were more likely to consider expanding their businesses or to rethink their business models in response to the crisis. These findings emphasize that women business owners are struggling to keep their businesses afloat and need guidance to weather this tough time. While pivoting business models and implementing marketing techniques might be key to keeping business doors open, women often lack the time, resources, and support needed to undertake these activities. Financial service providers can play a critical role in helping women entrepreneurs find innovative ways to pivot and strengthen their business during this time.
<h3>5. Meet women where they are by recognizing their day-to-day responsibilities and stressors.</h3>
<blockquote class="pullquote--right">49 percent of women reported spending more time tending to children since the onset of the pandemic, while only 7 percent of men reported the same.</blockquote>
Nearly two-thirds of women surveyed reported feeling more tired since the pandemic struck, and more than half reported greater emotional distress. Our survey analysis indicates that women entrepreneurs are spending significantly more time taking care of their children than their male counterparts. Forty-nine percent of women reported spending more time tending to children since the onset of the pandemic, while only seven percent of men reported the same. Women entrepreneurs who are also caretakers need convenient and easy-to-use financial and business management products that allow them to stay home while tending to their businesses. That being said, reports have also shown <a href="https://www.theguardian.com/society/2020/mar/31/call-for-uk-domestic-violence-refuges-to-get-coronavirus-funding" target="_blank" rel="noopener noreferrer">sharp surges in reported domestic violence</a> around the world as a result of the lockdown. Offering non-financial services — such as hotlines to connect with experts in gender-based violence or telehealth services — has been found to be highly impactful among women.

The vulnerabilities of women during a crisis like COVID-19 are significant and concerning. With this in mind, <a href="/eight-ways-financial-service-providers-can-drive-economic-recovery" target="_blank" rel="noopener noreferrer">Accion Global Advisory Solutions is creating products</a> that help women stay safe and financially healthy during this trying time. We created new modules focused on the crisis for Accion’s interactive edtech platform, Ovante, to help microentrepreneurs adapt their businesses without ever leaving home. This type of flexible education is perfect for women entrepreneurs, who are — as we have seen — strapped for time due to an increase in household responsibilities, and less likely to understand or trust financial products and business strategies that are essential for business survival.

Accion continues to work closely with our financial service provider partners to design additional products that meet the everyday needs of women and equip women entrepreneurs with the knowledge and tools they need to survive this pandemic and build resiliency for the future.

5 ways to help women entrepreneurs adapt during COVID-19

Amee Parbhoo

henry

<h2>Embracing tech to pursue new job opportunities in Latin America</h2>
In Latin America, a fintech startup called <a href="https://soyhenry.com/" target="_blank" rel="noopener noreferrer">Henry</a> is working to <a href="/a-fintech-cultivates-tech-talent-in-latin-america" target="_blank" rel="noopener noreferrer">expand access to software development education</a> so that more people can receive the training needed for jobs in tech, no matter their background, income, or experience. Henry, an Accion Venture Lab portfolio company, has <a href="/what-does-embedded-inclusive-fintech-look-like" target="_blank" rel="noopener noreferrer">embedded financial services into their education product</a> to make it accessible to more people. Students enroll in Henry’s online coding bootcamp program at no cost until they’ve completed the program and secured a job. Not only are they democratizing education in Latin America by opening opportunities to anyone regardless of their financial situation, but they are also working to bring more women onto their platform and into Latin America’s rapidly growing tech industry.
<div id="attachment_23497" style="width: 352px" class="wp-caption alignright"><img aria-describedby="caption-attachment-23497" class="size-full wp-image-23497" src="https://content.accion.org/wp-content/uploads/2021/03/rocio-henry-client-testimonial.png" alt="Rocio, a Henry graduate" width="342" height="188" srcset="https://content.accion.org/wp-content/uploads/2021/03/rocio-henry-client-testimonial.png 342w, https://content.accion.org/wp-content/uploads/2021/03/rocio-henry-client-testimonial-300x165.png 300w" sizes="(max-width: 342px) 100vw, 342px" />Henry spotlights women from their online community, like <a href="https://www.linkedin.com/feed/update/urn:li:activity:6729858752872288256/" target="_blank" rel="noopener noreferrer">Rocio on LinkedIn</a>, to inspire other women to explore careers in tech.</div>
Co-founder Luz Borchardt’s ultimate goal is to include more women in tech by giving women a voice and fostering an inclusive community. There is a huge demand for tech skills in Latin America, and software development presents a great opportunity for people to build secure careers. By honing their technical skills through Henry’s platform, women gain the qualifications needed to join the tech workforce. But while the demand is growing, coding and software development are not viewed as appealing careers for women in the region. This social perception holds women back from considering tech as a stable way to earn a living.
Henry is working to overcome the belief that coding is a career for men through dedicated support and recruitment efforts tailored to women. They’re building a community that encourages women to pursue opportunities by facilitating meetups of women in tech, launching a dedicated blog with resources for women, representing women on their website, and featuring testimonials from female students on their social media pages. This community, called Henry Women, offers women support and empowerment to seize new opportunities they may have never considered before.
<blockquote class="pullquote--right">“The products of the future have to be built for everyone. Everyone has to be represented at the table and at the discussion when designing a product.”</blockquote>
Luz and her team know that diversity is the way forward, and inclusivity is core to their work help everyone access the education needed to reach their potential. “The products of the future have to be built for everyone. Everyone has to be represented at the table and at the discussion when designing a product,” says Luz. As their students complete their curriculum, Henry helps them to find jobs in their new field. They are elevating the voices of their female students and advocating for tech companies to prioritize hiring women. Henry conducts diversity talks and with their tech company partners to stress how companies can perform better when they prioritize gender parity in the workplace and build diverse teams. Thirty percent of Henry’s own staff are women, and the majority of their instructors are women. So far, Henry has grown their percentage of female students from 20 to 25 percent — a significant number in Latin America, where only 10 percent of women college graduates were enrolled in engineering or technology courses in 2018, according to the company’s research.

self

<h2>Community connections lead women to improve their financial health</h2>
In the United States, millions of Americans struggle to make ends meet because of poor credit histories and overwhelming debt. Women in the U.S. often face additional barriers to economic security as they hold <a href="https://www.aauw.org/resources/research/deeper-in-debt/" target="_blank" rel="noopener noreferrer">two-thirds of all student loan debt</a> and continue to earn just <a href="https://www.cnbc.com/2020/09/18/new-census-data-reveals-no-progress-has-been-made-closing-the-gender-pay-gap.html" target="_blank" rel="noopener noreferrer">82 cents for every dollar</a> earned by men — and the numbers are even worse for women of color. Through a user-friendly digital platform, Accion Venture Lab investee <a href="https://www.self.inc/" target="_blank" rel="noopener noreferrer">Self Financial</a> gives Americans a <a href="/everyone-deserves-a-second-chance-to-build-credit-and-financial-security" target="_blank" rel="noopener noreferrer">pathway to build credit and savings</a>, so they’re better prepared to face life’s challenges and reach their dreams. Word of mouth has played a crucial role in Self’s growth as the majority of customers have found Self from friends, family members, and trusted communities. Self’s customer base has grown organically, and their customer base is comprised of 65 percent women, and over 60 percent people of color.
As more people have turned to the platform at the recommendation of others, Self sees the importance of trust and community for their customers. Self has used focus groups and psychographic research to develop educational content and messaging that resonates with their primarily female customer base, and they’ve shaped their customer experience to make users more comfortable as they begin their journey towards financial stability.
<div id="attachment_23502" style="width: 310px" class="wp-caption alignright"><img aria-describedby="caption-attachment-23502" class="wp-image-23502" src="https://content.accion.org/wp-content/uploads/2021/03/jernessa-self-client-graduation-small-766x1024.jpg" alt="Jernessa and her son at her graduation" width="300" height="401" srcset="https://content.accion.org/wp-content/uploads/2021/03/jernessa-self-client-graduation-small-766x1024.jpg 766w, https://content.accion.org/wp-content/uploads/2021/03/jernessa-self-client-graduation-small-224x300.jpg 224w, https://content.accion.org/wp-content/uploads/2021/03/jernessa-self-client-graduation-small-768x1027.jpg 768w" sizes="(max-width: 300px) 100vw, 300px" />Jernessa J. shares her story with other women whose poor credit history prevents them from reaching their dreams.</div>
<a href="https://www.self.inc/blog/jernessa-credit" target="_blank" rel="noopener noreferrer">Jernessa J. decided to take control of her future</a> after she found Self through an online community on Facebook. “Self was the first thing I used because it was the only thing that I could get approved for. Once I made several on-time payments, it better positioned me to get approved for lower limit credit cards. Self, coupled with proper management of those credit cards, were instrumental in my rebuilding of credit,” she says. After she transformed her financial situation, Jernessa became a financial coach to help other women access the tools and education to build their financial health. She shares her personal experience with Self to help others: “It is my ‘go-to’ resource to help get my clients on the right track the way that it helped me!” Now that Jernessa has improved her financial health, <a href="https://www.cnbc.com/2021/01/17/how-one-mother-is-building-generational-wealth-for-her-young-son.html" target="_blank" rel="noopener noreferrer">she’s working to build generational wealth for her son</a>, and has even launched a new online accessories business and earned another degree — all during the pandemic. When Jernessa and other influencers share their powerful stories, they encourage more women to control of their finances and build a better future.
By listening to their female customers and considering their unique needs and challenges from the beginning, companies like Self Financial and Henry are more effective in helping women embrace tech and digital financial tools. When inclusive fintechs and other social innovators recognize and address the difficulties that women around the world face through their product design, marketing, and customer support, the impact of their products can go much further. As we look toward rebuilding from COVID-19, we must ensure that women can find tools and resources they need to recover from this crisis and seize new opportunities.

When fintech startups prioritize meeting the needs of their female customers through inclusive marketing, customer engagement, and community building, they open more opportunities for women

Digital financial services have changed the game when it comes to reaching low-income families, small businesses, and rural communities with the tools that can improve their lives. In particular, early-stage fintech startups have the <a href="/fintech-startups-are-small-yet-mighty-partners-in-building-resilience-but-they-need-to-grow-to-succeed" target="_blank" rel="noopener noreferrer">agility and innovation to leverage technology</a> to reach more people. The pandemic has underscored how fintech startups are positioned to help underserved people and businesses to build resilience, like <a href="/schools-go-virtual-with-fintech-support-in-indonesia" target="_blank" rel="noopener noreferrer">schools and students</a> in Indonesia who are adapting to remote learning, and <a href="/what-it-takes-for-one-family-business-to-stay-open" target="_blank" rel="noopener noreferrer">mom and pop shops</a> in Peru that need help stocking their shelves with food and essentials.

Innovative fintech products can even open opportunities for women, who have been <a href="https://www.centerforfinancialinclusion.org/building-resilience-how-to-ensure-women-are-not-left-behind-as-a-result-of-covid-19" target="_blank" rel="noopener noreferrer">disproportionately impacted by COVID-19</a>, to stay resilient — but they can also inadvertently increase gender gaps if they don’t address inequalities that women still face. In addition to being less likely than men to <a href="https://www.gsma.com/mobilefordevelopment/wp-content/uploads/2018/04/GSMA_The_Mobile_Gender_Gap_Report_2018_32pp_WEBv7.pdf" target="_blank" rel="noopener noreferrer">own mobile devices</a> or have the <a href="https://data.worldbank.org/indicator/se.adt.litr.fe.zs" target="_blank" rel="noopener noreferrer">digital literacy needed</a> to use technology effectively, women also face cultural and societal barriers to embracing tech — for their careers, their businesses, and their financial health. When fintechs <a href="/want-to-fix-the-financial-inclusion-gender-gap-ask-better-questions" target="_blank" rel="noopener noreferrer">understand their female clients and find better ways to reach them</a>, they can create more inclusive and impactful products. Thoughtful customer engagement and marketing can cultivate trust and address societal barriers so that more women are empowered to adopt digital tools and seize new opportunities.

Making sure fintech is an equalizer for women — not another barrier

Elizabeth Winters

ashleylewis

<h3>Ashley Lewis, Senior Investment Officer, Africa, Accion Venture Lab</h3>
<img class="alignright wp-image-23482" src="https://content.accion.org/wp-content/uploads/2021/03/ashley-lewis-accion.jpg" alt="Ashley Lewis" width="350" height="525" srcset="https://content.accion.org/wp-content/uploads/2021/03/ashley-lewis-accion.jpg 800w, https://content.accion.org/wp-content/uploads/2021/03/ashley-lewis-accion-200x300.jpg 200w, https://content.accion.org/wp-content/uploads/2021/03/ashley-lewis-accion-768x1152.jpg 768w, https://content.accion.org/wp-content/uploads/2021/03/ashley-lewis-accion-683x1024.jpg 683w" sizes="(max-width: 350px) 100vw, 350px" />From her early start interning in a bank at the young age of sixteen, Ashley Lewis witnessed how financial services improve lives. She met families who walked into her bank looking for support while they struggled with their financial health. “I saw how personal and important it is to have access not only to financial services, but also to have a financially prosperous life.” Ashley has now lived on four different continents since her beginnings in California, widening her perspective on the challenges that hold people back — and the resilience that financial tools can provide. Today, she&#8217;s based in Nigeria, investing in and supporting inclusive fintech startups throughout Africa as a <a href="/bio/ashley-lewis" target="_blank" rel="noopener noreferrer">Senior Investment Officer</a> with Accion Venture Lab.
As Ashley has helped social ventures around the world reach more people, she’s seen how inclusive fintech can change the lives of women and their families. “Most of the time, women have the greatest ambitions for their families and for themselves. By creating inclusive financial services for women, I’ve seen them invest in their businesses, invest in their children, invest in their households, and prosper.” When women have the right financial tools to build businesses and improve their financial health, their success creates a ripple effect in their families and their communities.
Ashley looks ahead to a future where more women have opportunities to lead and thrive. “What I’m really excited about is seeing so many women globally being put into places of power and leadership. We’re now starting to see this tide turn where more women’s voices are at the table. When women have a voice, we can ensure that women don’t get left behind.” As more and more women step into leadership roles, Ashley believes they should lean into their unique capabilities and strengths. “As women, we have our own superpowers deeply embedded in us, whether that’s our intuition, our creativity, our collaboration. It’s important for women to identify those unique skill sets in themselves and bring that into the environments where they operate. Instead of trying to mirror what we see as successful leadership — often from a masculine perspective — we should dive into our unique abilities as women and bring that forward because that’s really what the world needs right now.”

luzurrutia

<h3>Luz Urrutia, Chief Executive Officer, Accion Opportunity Fund</h3>
<img class="alignright wp-image-23481" src="https://content.accion.org/wp-content/uploads/2021/03/luz-urrutia.jpg" alt="Luz Urrutia" width="500" height="333" srcset="https://content.accion.org/wp-content/uploads/2021/03/luz-urrutia.jpg 1201w, https://content.accion.org/wp-content/uploads/2021/03/luz-urrutia-300x200.jpg 300w, https://content.accion.org/wp-content/uploads/2021/03/luz-urrutia-768x512.jpg 768w, https://content.accion.org/wp-content/uploads/2021/03/luz-urrutia-1024x683.jpg 1024w" sizes="(max-width: 500px) 100vw, 500px" />Luz Urrutia’s passion for inclusive finance comes directly from her own personal experience. “When I moved to the United States to finish my undergraduate degree, I worked at a bank. I applied for a $500 credit card from the very bank I worked at and was turned down because, as an immigrant, I had no credit history. I realized that if I was having this problem, as a bank employee, there was a wider problem. I decided that one day I would build a company that provides financial services to folks that don’t have access to them. Folks like me.”
Luz went on to found El Banco de Nuestra Comunidad, a community bank in Atlanta, Georgia, that focused on serving the Hispanic population with little or no credit history. She’s since become CEO of <a href="https://www.opportunityfund.org/" target="_blank" rel="noopener noreferrer">Accion Opportunity Fund</a>, Accion’s partner in the U.S., which provides loans to low and moderate-income immigrants, women, and other underserved small business owners.
While there’s still work to be done to make financial systems open to more people, Luz and her team at Accion Opportunity Fund are excited by the possibilities that tech opens up for connecting more women and people of color to the capital needed to grow their businesses. “Despite the advancements made to accelerate financial inclusion, women, and especially women of color, are still excluded from access to financial tools around the world. To bridge this gap, fintech has played a considerable role in opening opportunities for women globally, by providing digital solutions that cater to the constraints women face. Fintech provides women with the flexibility to access the resources they need, allowing them to conveniently gain access to resources to effectively run their businesses.”
That ability to run businesses effectively is crucial as entrepreneurship is a particularly powerful tool for women to build better futures. As Luz points out, “Of the <a href="https://www.cnn.com/2021/01/08/economy/women-job-losses-pandemic/index.html" target="_blank" rel="noopener noreferrer">140,000 jobs</a> lost in the U.S. last December, all of these jobs were held by women, and mostly women of color. In order to ensure women aren’t left further behind, we must focus on giving women the tools they need to start and run their own businesses. Entrepreneurship is a way for women to build wealth. Indeed, <a href="https://prosperitynow.org/issues/entrepreneurship" target="_blank" rel="noopener noreferrer">entrepreneurship is second only to homeownership</a> in building wealth. What’s more, <a href="https://www.wsj.com/articles/is-it-insane-to-start-a-business-during-coronavirus-millions-of-americans-dont-think-so-11601092841" target="_blank" rel="noopener noreferrer">Americans are starting businesses</a> at a faster rate now than in years, and women of color are <a href="https://www.fastcompany.com/90408156/women-of-color-are-starting-businesses-faster-than-anyone" target="_blank" rel="noopener noreferrer">starting businesses</a> faster than any other group. Thus, women need access to the capital and support needed to start and run their businesses, especially during this particularly challenging time.” This belief in entrepreneurship and inclusive finance is what drives Luz in her work every day as she opens up more opportunities for women to thrive.

Part of Accion’s annual series highlighting women working in financial inclusion

All around the world, financial services like bank accounts, insurance, and credit products, can enable people to open their own businesses, educate their children, and provide for their families. But these basic financial tools aren’t within reach for everyone, including <a href="https://globalfindex.worldbank.org/" target="_blank" rel="noopener noreferrer" data-stringify-link="https://globalfindex.worldbank.org/" data-sk="tooltip_parent">980 million women</a> who don’t have a bank account or even the ability to send and receive money on their phones. The COVID-19 pandemic has <a href="https://www.centerforfinancialinclusion.org/the-case-for-a-gender-intelligent-approach-an-opportunity-for-inclusive-fintechs" target="_blank" rel="noopener noreferrer" data-stringify-link="https://www.centerforfinancialinclusion.org/the-case-for-a-gender-intelligent-approach-an-opportunity-for-inclusive-fintechs" data-sk="tooltip_parent">exacerbated inequalities that women face</a> and exposed how the <a href="https://www.womensworldbanking.org/insights-and-impact/womens-economic-empowerment-doorway-to-economic-recovery/" target="_blank" rel="noopener noreferrer" data-stringify-link="https://www.womensworldbanking.org/insights-and-impact/womens-economic-empowerment-doorway-to-economic-recovery/" data-sk="tooltip_parent">gender gap in financial inclusion</a> continues to hold women back.

This year, the <a href="https://www.unwomen.org/en/news/stories/2020/11/announcer-international-womens-day-2021" target="_blank" rel="noopener noreferrer" data-stringify-link="https://www.unwomen.org/en/news/stories/2020/11/announcer-international-womens-day-2021" data-sk="tooltip_parent">UN Women theme for International Women’s Day</a> is “Women in leadership: Achieving an equal future in a COVID-19 world.” We’re <a href="https://www.accion.org/series/women-of-accion" target="_blank" rel="noopener noreferrer" data-stringify-link="https://www.accion.org/series/women-of-accion" data-sk="tooltip_parent">highlighting women leaders</a> who are working to open opportunity for women and men through inclusive finance, and to rebuild a more equitable world for all.

Meet some of the women we’re inspired by: 
<h3>Maria Otero, Former Under Secretary of State for Civilian Security, Democracy, and Human Rights, and Former President and CEO of Accion</h3>
<img class="wp-image-23480 alignright" src="https://content.accion.org/wp-content/uploads/2021/03/maria-otero.jpg" alt="Maria Otero" width="450" height="300" />

“I believe that all women are leaders and that all women can make an impact. And that impact operates not just at their family level, but at their community level, and in some cases, as their national level and internationally.” Maria Otero is adamant in her belief that all women can make a difference, and her own career has been a testament to what a determined and passionate woman can accomplish. Born in La Paz, Bolivia, Maria started her career working in women’s health. As she traveled around the world, she saw how women were held back by a lack of economic empowerment, and she pivoted towards a career in financial inclusion. “I learned a great deal about the women’s movement, about how it is that women were addressed throughout the world, the inequities that existed overall, the inability for women to be treated as citizens like men.”

When she later became President and CEO of Accion, she shifted the focus from microcredit to microfinance to financial inclusion and oversaw the creation of the Center for Financial Inclusion. During her time at Accion, Maria witnessed the remarkable difference that financial services can make in the lives of women: “Financial tools have been the gate through which women have been able to work, to expand their own opportunities, and to become more self-sufficient. There’s just absolutely no question that financial inclusion is one way to truly integrate women into society. It is also one way to help [women] educate their children so that they can grow into a different generation – especially their daughters. You can see this wherever you go.”

Maria believes that women have all around the world tenacity and determination to succeed. “I learned so much about being a confident and fearless woman from my mother who at 94 is still going strong,” she says. With the right tools, women open businesses, provide for their families, and build better futures. “It doesn’t matter if you’re talking about Brooklyn, New York, or Bangkok, Thailand, across the world you see that being able to believe in women and trust in women and give them opportunity allows them to demonstrate that they can pay all their loans back, they can manage their resources, and they can also take on other financial products.”

She brought her passion for social change and her global perspective into her work at the US State Department as Under Secretary for Civilian Security, Democracy, and Human Rights. In this role and her many other leadership positions, she’s fought to build an equitable world that creates opportunities for all people, including women.

Maria encourages younger generations to understand the work that has come before them as they continue striving towards gender equality. As digital tools and social media continue to change how we influence thinking, “it is really important to understand that even though we have different means of communicating [across different generations], we are building on the shoulders of much that came before us.”

Women leaders open opportunity through inclusive finance, part one

Tracking the data collected through Accion’s hundreds of partners around the world can seem daunting and complicated. But making sense of this data is key to understanding how our work is making a difference for vulnerable populations, especially as they confront the challenges of COVID-19.

In 2020, Accion welcomed Credit Suisse’s Saad Khalid for six months as a volunteer to help Accion improve data collection and tracking efforts. An analyst in Credit Suisse’s compliance division, Saad leveraged his expertise to help a team of Accionistas build a data system to improve our monitoring and evaluation processes. Ultimately, they sought to enhance Accion’s ability to tell the story of our impact.

Saad’s experience at Credit Suisse in data analysis, data consolidation, rapid prototyping, and stakeholder management made him a valuable addition. His help centralizing Accion’s data opened doors for us to learn and grow. Saad said he hoped to leave us with a working solution, not mere recommendations, and indeed he has.
<h2>Building on a longstanding partnership</h2>
Credit Suisse employees like Saad can engage with Accion through the bank’s Global Citizens Program and Virtual Volunteering Program, whereby Credit Suisse employees can join Accion teams and apply their skillsets towards projects that build organizational capacity and help us better serve low-income families and small businesses across the globe.

<a href="https://www.accion.org/credit-suisse-and-accion-exploring-new-frontiers-in-financial-inclusion" target="_blank" rel="noopener noreferrer">For more than a decade, Accion and Credit Suisse have partnered to build a financially inclusive world.</a> Credit Suisse was integral to the 2008 launch of the Center for Financial Inclusion at Accion, which uses rigorous research and advocacy to advance inclusive financial systems for low-income people around the world. Credit Suisse was also a key supporter of the 2012 launch of Accion Venture Lab and supports its continued efforts to expand access to financial services through investing in and growing seed-stage fintech startups.
<h2>Adding a new and valuable perspective</h2>
Saad shared that his experience growing up in Pakistan and later in the UK helped draw him to work with Accion. He saw firsthand the life-changing effect that access to financial tools can have on improving the livelihoods of families and their communities. Saad also has a long history of working in the social impact sector.

In his spare time, Saad serves on the founding teams of two mission-driven startups. One startup offers digital recruitment solutions in Pakistan, and the other is a gig economy platform that democratizes access to employment via data labeling for machine learning.

Both Saad and the Accion team gained valuable lessons through his participation in the Credit Suisse Global Citizens Program. Saad gained a better understanding of data’s role in Accion’s work and also came to value Accion’s “capital plus” model, in which investors broaden their involvement with partners to include mentorship, technical assistance, governance, and more.

Saad’s invaluable additions strike at the essence of Accion’s partnership with Credit Suisse. As the broader industry continues to deepen transparency and data-informed approaches, we are excited to continue to build on his contributions to our work.

Partnering for a better view of Accion’s impact

English

Global nonprofit Accion issued the following statements today on the passing of our friend and colleague Kurt Koenigsfest.  
A close personal and professional friend to many of Accion’s team members, Kurt filled many roles in his life as a father and family member, friend, community leader, and financial inclusion pioneer.  
At the time of his passing, Kurt served as CEO of BancoSol, Bolivia’s largest microcredit bank and longtime partner of Accion. A champion for financial inclusion, Kurt led BancoSol since 2000. Under his leadership, BancoSol has provided more than 1.5 million low-income consumers and small businesses with the high-quality financial services they need to grow and thrive. Throughout the COVID-19 pandemic, Kurt oversaw the rollout of digital financial products that allowed customers to continue to access essential financial services during lockdowns. 
Michael Schlein, President and CEO of Accion, said, “Kurt’s passing is a devastating loss, and our thoughts today are with his family and loved ones. Kurt was not only a leader, friend, and collaborator respected by many—his work pioneered the commercial model of microfinance that today is used across the world to help millions of low-income people access the basic financial tools they need to build better lives. He helped grow and transform BancoSol into a leading institution helping more than a million low-income Bolivians recover from the severe effects of the pandemic. His professional legacy lives on in the families, small businesses, and communities he helped support, and it will continue to inspire our work.” 
Esteban Altschul, COO of Accion and chairman of BancoSol’s Board of Directors, said, “Our hearts go out to Kurt’s family, friends, and colleagues as they cope with this profound loss. I have had the privilege to work closely with Kurt over the last decade, and he became one of my closest friends. His courageous efforts and dedication in the field of microfinance have made a measurable impact on the lives of Bolivians and underserved people around the world. The global financial inclusion community has lost one of its most inspiring leaders much too soon.” 
Accion first backed BancoSol in the 1980s as a charity, then supported its transition to a commercial bank dedicated solely to microfinance in 1992 as a significant minority shareholder and partner. Since then, Accion has continued to partner with BancoSol in the development and rollout of digital financial services for Bolivia’s underserved populations.

Español

<h2>Accion emite una declaración sobre el fallecimiento de Kurt Koenigsfest</h2>
Accion, una organización mundial sin fines de lucro, emitió las siguientes declaraciones el día de hoy sobre el fallecimiento de nuestro amigo y colega Kurt Koenigsfest.
Se trata de un amigo personal y profesional, cercano a muchos de los miembros del equipo de Accion: Kurt desempeñó muchos papeles en su vida como padre y familiar, amigo, líder comunitario y pionero de la inclusión financiera.
Al momento de su fallecimiento, Kurt ejercía como presidente ejecutivo de BancoSol, el banco de microcréditos más grande de Bolivia, socio de Accion desde hace mucho tiempo. Kurt, un defensor de la inclusión financiera, dirigió BancoSol desde el año 2000. Bajo su liderazgo, BancoSol ha proporcionado a más de 1 millones de consumidores de bajos ingresos y pequeñas empresas, los servicios financieros de alta calidad que necesitan para crecer y prosperar. A lo largo de la pandemia de COVID-19, Kurt supervisó el despliegue de productos financieros digitales que permitieron a los clientes seguir accediendo a servicios financieros esenciales durante los confinamientos.
Michael Schlein, presidente y CEO de Accion, comentó: &#8220;El fallecimiento de Kurt es una pérdida devastadora, y nuestros pensamientos hoy están con su familia y sus seres queridos. Kurt no sólo fue un líder, amigo y colaborador respetado por muchos: su trabajo fue pionero en el modelo comercial de microfinanzas que hoy se utiliza en todo el mundo para ayudar a millones de personas de bajos ingresos a acceder a las herramientas financieras básicas que necesitan para mejorar sus vidas. Ayudó a crecer y transformar a BancoSol en una institución líder que ayudó a más de un millón de bolivianos de bajos ingresos a recuperarse de los graves efectos de la pandemia. Su legado profesional sigue vivo en las familias, las pequeñas empresas y las comunidades a las que ayudó con su apoyo, y continuará inspirando nuestro trabajo&#8221;.
Esteban Altschul, COO de Accion y presidente de la Junta Directiva de BancoSol, dijo: &#8220;Nuestros corazones están con la familia, los amigos y colegas de Kurt cuando se enfrentan a esta irreparable pérdida. He tenido el privilegio de trabajar en estrecha colaboración con Kurt durante la última década, hasta convirtirse en uno de mis amigos más cercanos. Sus denodados esfuerzos y su dedicación al campo de las microfinanzas, han tenido un impacto medible en la vida de bolivianos y personas mal atendidas de todo el mundo. La comunidad mundial de la inclusión financiera ha perdido demasiado pronto a uno de sus líderes más inspiradores&#8221;.
Accion respaldó por primera vez a BancoSol en la década de 1980, cuando era aún una organización benéfica; luego apoyó su transición a banco comercial dedicado exclusivamente a las microfinanzas en 1992, como accionista minoritario y aliado. Desde entonces, Accion ha seguido colaborando con BancoSol en el desarrollo y despliegue de servicios financieros digitales para las poblaciones desatendidas de Bolivia.

Announcement

Accion issues statements on the passing of Kurt Koenigsfest

Esteban Altschul

After many months of difficult lessons and adaptations during the pandemic, three of our microfinance partners look ahead to the next chapter

When I reflect on 2020, I’m struck by the resiliency we’ve seen at every turn — from our employees, our partners, and especially, from the end clients that they serve. The obstacles have often felt insurmountable: there are predictions that anywhere between 20 and 30 percent of micro, small, and medium enterprises (MSMEs) in emerging markets will permanently close. Yet so many of these entrepreneurs are working hard to recover or to reinvent themselves.

While there is still a long road ahead in economic recovery from the COVID-19 pandemic, we have reasons to be optimistic about the coming year and the ability of our partners in financial inclusion to adapt and support their clients. A few of our partners — Kshama Fernandes, Managing Director and CEO of <a href="https://www.northernarc.com/" target="_blank" rel="noopener noreferrer">Northern Arc</a> in India, Taiwo Joda, Managing Director of <a href="https://www.accionmfb.com/" target="_blank" rel="noopener noreferrer">Accion Microfinance Bank</a> in Nigeria, and Kurt Koenigsfest, CEO of <a href="https://www.bancosol.com.bo/" target="_blank" rel="noopener noreferrer">BancoSol</a> in Bolivia — <a href="/leadership-in-the-time-of-covid-19-navigating-the-next-chapter" target="_blank" rel="noopener noreferrer">recently gathered</a> to reflect on the past nine months. They discussed how they have continued to adapt since the beginning of the pandemic, the difficult lessons they’ve learned <a href="/how-do-we-drive-an-inclusive-recovery-from-covid-19" target="_blank" rel="noopener noreferrer">since we first convened this group for a webinar in June</a>, and how they plan to meet the needs of their low-income clients in 2021.
<h2>How Accion Microfinance Bank, BancoSol, and Northern Arc are meeting the needs of small businesses</h2>
Small businesses have always played a crucial role in economies around the world, and supporting them has never been more urgent for our microfinance partners. BancoSol and Accion Microfinance Bank (Accion MfB) have many years of experience providing high-quality microfinance services to their clients through various challenges, but the COVID-19 pandemic has forced these banks to be flexible in new ways.

In addition to offering <a href="/how-do-we-drive-an-inclusive-recovery-from-covid-19" target="_blank" rel="noopener noreferrer">extra support with banking services</a>, BancoSol provided food staples, such as rice and sugar, to all clients who made voluntary repayments during the country’s 180-day moratorium. In Nigeria, Accion MfB also provided food to those whose likelihoods were affected. Additionally, to help clients pivot and succeed, Accion MfB started a special training program with experts on small businesses to engage their clients on how to restart or reinvent their businesses and partnered with online, commercial stores, and digital merchant platforms to enable about 4,000 of their customers to sell their products and services online.

Our partner Northern Arc is a financial inclusion platform that offers credit to the underbanked by supporting more than 150 financial institutions that serve millions of low-income borrowers all over India. They’ve provided loan repayment moratoria to support many of their clients. When financial institutions can take some pressure off of small business owners who are struggling with liquidity issues, these entrepreneurs can focus on meeting the needs of their community. Northern Arc shared that they’ve even seen interest in entrepreneurship increase during the pandemic as people seek new opportunities to replace the livelihoods they’ve lost.
<h2>Lessons learned since the start of COVID-19</h2>
While all three of these partners have been working on <a href="/data-is-crucial-for-driving-inclusive-growth" target="_blank" rel="noopener noreferrer">digital strategies</a> for several years, the pandemic pushed them to evolve at a faster pace to meet increasing client needs in an environment with new challenges, including lockdowns, moratoria, and public health concerns. As Taiwo noted, “The pandemic created a high level of urgency for us to continue on our <a href="/accion-microfinance-bank-adopts-risk-management-systems-in-nigeria" target="_blank" rel="noopener noreferrer">digital journey</a>.”

To make it easier for clients to access funding remotely during the pandemic, Accion MfB initiated an agent banking initiative, began using additional digital channels, and creating digital loan products where clients, especially those located in remote areas, can apply for loans. BancoSol also expanded the rollout of their virtual lending app so that more people could access banking services from their phones rather than rely on branches during Bolivia’s lockdown Between September 2019 and September 2020, transactions on BancoSol’s app increased by 141 percent.

As digital financial tools become more essential, all of our partners emphasized the need to combine tech and touch to reach customers where they are. As Kurt put it, “I think technology is going to help. It’s a powerful tool, but microfinance is a high-touch model.” Both Kurt and Taiwo stressed the importance of having staff guide their clients through the process of setting up digital accounts so they have the skills and confidence to use them effectively. Companies that find ways to continue to improve on efficiencies that can be gained from today’s digital world while still cultivating a personal relationship with their clients will ultimately have the best chance of succeeding in the long term.
<h2>Looking ahead to the next chapter of recovery</h2>
<blockquote class="pullquote--right">“Very quickly we saw that life must move on, and we just sort of kept at it…this was the momentum that kept us going, one foot after another”</blockquote>
As we’ve walked through this crisis with our partners, we’ve witnessed their resiliency and optimism. Because institutions like BancoSol, Accion MfB, and Northern Arc were prepared and flexible prior to the pandemic, they were able to quickly pivot and adapt as they were faced with challenges they had never encountered before. “The beginning of the pandemic, it seemed a little bit like doomsday. Very quickly, we saw that life must move on, and we just sort of kept at it, whether it was at the institutional level, the investor level, the client level, the employee level, and I think this was the momentum that kept us going, one foot after another,” said Kshama.

Though financial service providers have already made significant changes to adapt during the pandemic, much work lies ahead. COVID-19 continues to fuel uncertainty around the globe and has an outsized impact on vulnerable populations, but our partners are up to the challenge of helping people and small businesses most in need of support. Accion is working with our partners to provide the best solutions for these entrepreneurs to stay financially resilient and take their next steps to recover. We believe our partners, especially those that leverage data and technology effectively, will emerge with a better understanding of how to best meet their clients’ needs.

<a href="/leadership-in-the-time-of-covid-19-navigating-the-next-chapter" target="_blank" rel="noopener noreferrer">Hear more from Kshama, Taiwo, and Kurt here</a>, and learn about challenges and success stories from our partners around the world <a href="/covid19" target="_blank" rel="noopener noreferrer">here</a>.

Moving beyond “doomsday”: Inclusive finance in the time of COVID-19

Debdoot Banerjee

Small business owners in India reopen their businesses and rediscover hope for the future with customer-focused loan products and support from Annapurna Finance Ltd.

Twenty-six-year-old Rosina Das runs a small grocery shop in her village near Balakati, Odisha, in eastern India. She and her husband own a small lot of land, but their crops don’t bring in enough money for them to provide for their two children and meet their household needs. Because her family hasn’t been able to afford to install pump irrigation, they must rely on rain for their crops and can only grow during India’s kharif, or monsoon, season. Rosina needed another way to support her family, so she converted a small room in her house into a grocery store and became a small business owner.

When Rosina first started her business, she used her savings to buy grocery items to sell in her shop. Her business quickly took off since there weren’t many other stores in her village. Once Rosina opened her doors, she gave families in her community the ability to purchase fresh food and other essentials that weren’t able to buy before. Rosina availed of her first loan with <a href="https://annapurnafinance.in/" target="_blank" rel="noopener noreferrer">Annapurna Finance Ltd.</a>, a microfinance institution and Accion partner in India, two years ago as a group lending client to grow her small business even further. As her household income increased, her family was able to break their pattern of dependence on seasonal agriculture.

Like millions of other micro, small, and medium enterprises (MSMEs) operating in India, Rosina’s business has struggled greatly during the coronavirus pandemic. Not only did her sales plummet, but she also had a hard time getting new inventory to sell in her store as her suppliers were limited by transport restrictions during India’s strict lockdown. Without her regular customer volume or sufficient stock to sell, Rosina suddenly found herself without a stable income and unable to repay her small business loan installments. She learned about India’s loan moratorium from the other borrowers in her lending group and worked with Annapurna to reschedule her repayment dates and extend her loan tenure for two more months — a huge relief for her stalled business and her family.

[caption id="attachment_23303" align="alignright" width="393"]<img class="wp-image-23303" src="https://content.accion.org/wp-content/uploads/2021/02/papina-das-annapurna-finance-214x300.jpg" alt="Papina Das, an entrepreneur in eastern India" width="393" height="550" /> Papina Das owns a small dairy business near Balakati in eastern India.[/caption]

Rosina also learned about Annapurna’s midterm loan offering, a type of emergency loan that could help her restart her business. She received an emergency loan of 15,000 INR (205 USD) within seven days of application and purchased what she needed for her store. As demand has rebounded in her village, Rosina has provided the groceries that her community needs. Just a few months ago, she lost hope and couldn’t imagine her livelihood returning to normal. Now she is grateful to Annapurna for providing the support she needed to reopen her business.

Papina Das, 34, lives in the same village as Rosina, where she runs a small dairy business selling milk in her community and to nearby villages. She employs one other person from the village to help her feed and milk her cows. She started her business two years ago with a group loan from Annapurna. The other members of her lending group are also self-employed and own dairy businesses. Before COVID-19, Papina made a profit of more than 10,000 INR (137 USD) per month from her milk sales.

Papina’s sales dropped dramatically when the pandemic started. Residents of her village and the surrounding villages suffered greatly from the lockdown’s financial impact and many people lost their livelihoods. Even Papina’s regular customers stopped buying their usual volume of milk. Although milk is an essential commodity, her profits plummeted as economic instability decreased demand and people feared infection at markets.

Within one month of lockdown, Papina’s profits were cut in half. She was forced to lay off her employee and unable to pay her loan installments on time. After an Annapurna employee <a href="/how-three-financial-service-leaders-are-adapting-to-covid-19#annapurna" target="_blank" rel="noopener noreferrer">proactively contacted her by phone</a> and informed her about the loan moratorium during the lockdown, Papina opted to take a three-month moratorium on her payments. Like Rosina, Papina decided to take advantage of Annapurna’s midterm loan. Within three days of applying, she received a 20,000 INR (274 USD) loan. With this assistance from Annapurna, she’s rehired her assistant and restarted her dairy business. She’s also purchased another cow to speed up her business’s recovery, and her milk sales have nearly recovered to pre-pandemic levels.

A flexible loan can be the reason that a grocery store stays open in a village with few options for fresh food, or a dairy business continues providing milk to families in a rural community. Through <a href="/mastercard-and-accions-partnership-to-unlock-millions-of-underserved-microbusinesses" target="_blank" rel="noopener noreferrer">Mastercard and Accion’s partnership</a>, Accion is working with Annapurna Finance to develop a new digital emergency loan product for group lending customers like Rosina and Papina. To build products that help entrepreneurs stay in business, we surveyed Annapurna’s small business clients to understand <a href="/critical-lessons-from-a-survey-of-small-businesses-in-india" target="_blank" rel="noopener noreferrer">their experience and confidence using digital tools, how gender gaps affect digital access, the role of misinformation, and more</a>. When financial services providers like Annapurna consider the unique challenges that their clients face, they can play a critical role in helping India’s <a href="/digital-tools-open-opportunities-for-women-to-thrive" target="_blank" rel="noopener noreferrer">women entrepreneurs use well-designed digital tools</a> to overcome the pandemic’s challenges and help rebuild their local economies.

Women entrepreneurs get back to business in India

Amy Stewart

People in Chile and Mexico are building their financial health using a personalized platform that meets them where they are

Karen is a single mom who lives in Santiago, Chile, with her young daughter. She went to school to study business administration but had to drop out to care for her daughter. Today, she works at a retail shop where she makes just enough to get by. Karen worries all the time — about paying the bills each month, about providing for her daughter, and about her growing credit card debt. She knows she needs to make a change, but she doesn’t know where to start. She tried to put together a plan to pay off her debt, but couldn’t figure out the total amount she owed, or identify the right person to call. Thinking about money makes her feel stressed, overwhelmed, and alone.

Accion’s partner <a href="https://www.destacame.cl/" target="_blank" rel="noopener noreferrer">Destacame</a>, a Chile-based personal financial management platform, sees many people like Karen, who come to their website looking for a way to get out of debt, access their credit report, and get answers they’ve been unable to find in the formal financial sector. The pandemic has only exacerbated feelings of financial insecurity in Chile. Destacame found that, due to COVID-19, 54 percent of their users are facing reduced or no income, 30 percent are unable to pay bills and almost all noted uncertainty and stress about their financial situation. Only 12 percent said they felt prepared for a shock like COVID-19.

Destacame knew that their users need more than just access to financial products – they need help to navigate their financial lives. This includes clearly understanding their current situation, weighing the pros and cons of the solutions available, planning to achieve goals, and receiving support and guidance along the way. As one user said, “I want to save and change my spending, but I don’t have any idea where to begin! I need an advisor — like Jiminy Cricket — who provides me with guidance and helps me to plan.”
<h2>An advisor and companion on the path to financial health </h2>
[caption id="attachment_23231" align="alignleft" width="300"]<img class="wp-image-23231" src="https://content.accion.org/wp-content/uploads/2021/01/Bienestar-financiero_.jpg" alt="New Destacame site design diagnostic feature" width="300" height="754" /> The diagnostic asks several questions to gauge users’ needs, including budgeting, preparing for unforeseen circumstances, and planning for the future. [/caption]

To truly support users like Karen, Accion and Destacame came up with an ambitious solution: completely redesign the Destacame experience and value proposition around financial health by adding simple diagnostics, customized user journeys, and digestible tips, tools, and product recommendations that match the user’s current reality. Beyond simply adding new products and features, the ‘Experencia Destacame’ (Destacame Experience) project involved changing the core of the platform: how it was structured, how the user interacted, and what value it sought to provide.

The new site design starts by clearly communicating Destacame’s customized offering to potential users and highlighting common challenges for the target user, such as, “Are you up to your neck in debt?” and “Are you stressed by your finances?” Once registered, users arrive at a personalized dashboard that assesses their financial health in three main categories: budget management, shock resilience, and long-term planning. This three-part diagnostic serves as the heart of the site redesign: based on their responses, users are directed to discrete experiences that offer the most relevant support for where they are today, including tips and recommendations, access to tools, and suggestions for financial products. The diagnostic also allows Destacame to isolate a recommended next step, encouraging users to take one first action rather than overwhelming them with a flurry of recommendations and products.

The team also developed two digital tools to support users in their journey towards financial health: a budgeting tool and an expense reduction tool. These pieces are foundational for all platform users: before saving for shocks or planning for the future, individuals must first get their budget in order and make sure their expenses don’t exceed their income. Both tools are easily accessible on mobile devices, require little time to complete, and quickly demonstrate and reward progress towards better financial habits.

The budgeting tool walks users through a series of screens to add income and expenses and calculate their savings. It helps users to consider and understand all possible expense categories and prompts users to return and update after a few months.

<img class="alignright wp-image-23233" src="https://content.accion.org/wp-content/uploads/2021/01/Bienestar-Finanicero-Presupuesto.jpg" alt="Destacame budgeting tool" width="310" height="589" />The expense reduction tool helps users to better manage their monthly cash flow by setting goals to reduce expenses in key categories, and entering spending once a week to assess progress. The tool is designed to be flexible enough to meet user needs (for example, selecting the day to receive reminders) but structured enough to encourage action, using positive language, and offering support.

Destacame recommends customers complete the tools based on their unique situation. For example, if a user is unsure that they can cover their monthly expenses, the platform will direct her to complete a budget first to gain a better understanding of her cashflow. After completing the budget, she may see that she is spending more than she’s bringing in each month and be prompted to work on reducing expenses via the expense reduction tool. After reducing expenses, she may be encouraged to start saving, and provided with recommendations for relevant savings products. Core to our hypothesis is the belief that providing users with the right tool or product at the right time is critical for uptake, usage, and impact.

<img class="alignright wp-image-23234" src="https://content.accion.org/wp-content/uploads/2021/01/Selección-de-gastos-BG-e1611591473407.jpg" alt="Destacame expense reduction tool" width="310" height="482" />
<h2>Impact to date</h2>
Since launching in early 2020, almost 700,000 users in Chile and Mexico have visited the redesigned site. Almost 35,000 people have completed the diagnostic, 60,000 have accessed the budgeting tool, and 10,000 have accessed the expense reduction tool. These conversion rates are consistent with broader usage of Destacame products and impressive for self-driven tools. But perhaps more impressive is that the team is already seeing users’ financial behaviors change: since July, 35 percent of the users that completed the budget tool created a budget for the first time, 20 percent of those that accessed the expense reduction toolset a savings goal, and 17 percent of those using the expense reduction tool actually decreased their expenses.

When the pandemic hit in March 2020, Destacame saw the potential to help Chileans struggling with unemployment, debt, and uncertainty by offering a way for them to navigate their financial situation and set a plan for recovery. They launched a marketing campaign with the hashtag #CuarentenaFinanciera (financial quarantine) highlighting their new resources and encouraging users to focus on building their preparedness, resilience, and overall financial health. In response to a new law permitting pension savings withdrawal, the Destacame team launched another campaign in July called #ChileSinDeuda (Chile without debt) to encourage Chileans to use this opportunity to pay off outstanding debt, and work with their partner banks to offer discounts. Through this program, they were able to offer 3.5 million Chileans an average discount of 60 percent on their outstanding debt.

To encourage sustainable behavior change, institutions need to design for and encourage healthy financial habits that work within users’ everyday lives. While designed to be as easy-to-use as possible, Destacame’s current tools still rely heavily on user input. Users must be highly self-motivated and take the time to update tools. In 2021, Destacame plans to roll out additional products, including a new mobile application and debit card, that automate assessment and support for financial health and reduce effort for users. For example, syncing budgeting and expense management with card transactions, allowing users to set limits for certain categories and create savings wallets, and supporting future planning by projecting income and expenses.

Little by little, Destacame users are progressing on their path to financial health, supported by a more personalized approach that meets them where they are. Destacame’s focus on serving the low-income segment in Chile has also been a market differentiator and offered opportunities for further expansion and innovation. Today, Karen has finally gotten out of debt and is starting to save up towards buying a house. She’s happy with how far she’s come: “Destacame has motivated me to pay off my credit cards quickly, and I was able to get out of debt because of them.”

<img class="alignleft wp-image-10268 " src="https://content.accion.org/wp-content/uploads/2018/08/MetLife-Foundation.png" alt="MetLife Foundation logo" width="165" height="77" />This product is a part of our <a href="https://www.accion.org/accion-and-metlife-foundation-announce-expanded-partnership-to-advance-financial-inclusion/" target="_blank" rel="noopener noreferrer">Building Financial Capabilities and Strengthening Institutions through Customer-Centered Innovations</a> project, supported by MetLife Foundation.

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Finding a path to financial health in Chile, one step at a time

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