The working poor may get paid just once a year.

Low-income farmers are vulnerable to extreme weather conditions.

The world’s entrepreneurs face a $5 trillion financing gap.

Climate change affects the poorest households most.

We focus on global challenges

How we work

Priya Punatar

Yanina Seltzer

<div style="width: 391px" class="wp-caption alignright"><img src="http://accion-staging.flywheelsites.com/wp-content/uploads/2019/05/IMG_0825.jpg" alt="" width="381" height="508" />Azucena, a stay at home mom and former bank teller in Mexico</div>
Although Mexico and Chile are different markets, underserved consumers face similar problems improving their financial health. People and businesses rely on informal means to manage money, including storing cash in lockboxes and borrowing from family and friends. These methods are familiar and convenient, but they don’t provide the guidance, tools, and information people need to better manage their income and expenses, build reserves, and plan for the future.
In Chile, <a href="https://news.gallup.com/reports/233399/gallup-global-financial-health-study-2018.aspx">nearly half of the population</a> feels unsure about how they would cover their basic needs for more than a month if they lost their income. Following several financial crises, consumers are hesitant to trust<a href="https://www.accion.org/five-reasons-small-merchants-arent-using-financial-services-in-chile/"> financial institutions</a>, and many see working with banks as a last resort. One business owner in Santiago expressed a sentiment that we heard from many Chileans: “I would prefer to be indebted to my family than to a bank.”
We’ve seen similar patterns in Mexico, where, over the last three years, the percentage of adults who save at financial institutions declined from 15 percent to 10 percent. In an interview, Azucena, a stay-at-home mom who previously worked as a bank teller, told us that she and her husband prefer to <a href="https://www.accion.org/people-saving-money-mexico">save cash </a>in lockboxes in order to have money at home for unexpected emergencies. When it comes to credit, many people told us that they often hear negative stories about defaults, rather than positive stories about people using credit to improve their lives.
These behaviors indicate that FSPs could do more to better understand their clients’ needs and goals, build greater trust, and deliver more valuable products and services.
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<div style="width: 4938px" class="wp-caption alignleft"><img src="http://accion-staging.flywheelsites.com/wp-content/uploads/2019/05/DSC_0388.jpg" alt="" width="4928" height="3264" />FSP employees participate in a <a href="https://www.accion.org/building-and-deploying-user-centric-products">human-centered design exercise</a> in Chile</div>
For decades, Accion has worked around the world to help FSPs deliver the products that underserved clients need to access, use, and benefit from the formal financial sector. Our hybrid approach combines human-centered design, insights into emerging technologies, and effective business models to create financial services that accelerate social and economic progress.
Over the next 18 months, Accion, <a href="https://www.accion.org/accion-and-metlife-foundation-announce-expanded-partnership-to-advance-financial-inclusion/">in partnership with MetLife Foundation</a>, will apply this approach with five FSPs in Mexico and Chile. We’ll work alongside these institutions to develop viable products and services that reach underserved clients and improve their financial health. This process will include building the business case for customer-centric products; managing organizational change; and designing, testing, and implementing product innovations.
We’ll begin by using human-centered design, which links product and service design to customers’ needs and lives. By first understanding the challenges that low-income clients face and the goals they want to achieve, FSPs can create products and experiences that are available at the right moments, provide visibility into users’ finances, and take into account customers’ aspirations. Such products can lead to improved financial health, better decision-making, and more informed financial management.
While considering our clients’ needs and their goals, we’ll integrate behavioral science to create products and experiences that support healthy financial behaviors and habits. For example, behavioral scientists know that people tend to prioritize the present over the future and put off tasks that feel stressful, like budgeting, saving, and long-term planning. By taking this tendency into account and creating products that balance the management of day-to-day finances with future planning, we can promote clients’ financial health.
Ultimately, our understanding of low-income clients’ needs, the application of behavioral insights, and our focus on business considerations will inform the creation and deployment of new products that improve underserved clients’ financial health and that are sustainable in the market.
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To qualify for the program, FSPs developed product proposals that addressed low-income client needs using a customer-centric lens; each of their proposed solutions is tailored to improve clients’ financial health and advance the organization’s strategic business objectives. Our partners will adapt their proposals through several rounds of user research and ongoing support from Accion.
Below is a list of our five partners, their product concepts, and goals for improving the financial health of their customers.
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We’ll work alongside our partners to refine their initial concepts into customer-centric, market-ready products and services that help underserved families and small businesses improve their financial health.
Over the next 18 months, Accion and our partners will be working closely with customers, and with the FSP teams responsible for interface, application, operations, marketing and customer engagement to deliver an excellent customer experience. While we will focus on client behavior change, Accion and our partners understand that institutional change management is the real starting point.
For these solutions to promote clients’ financial health over the long-term, we will work with our partners to consider the business case for each product and the organizational changes needed to implement them. It’s only by combining our unique insights into client needs and our understanding of inclusive business models that our partners will be successful. It’s critical to look at longer-term profitability and customer lifetime value to ensure that our partners’ new products advance their long-term strategic goals; we’ll test customers’ willingness to pay for new services throughout their development and adjust product design to increase value to the customer.
These products represent significant new investments that will demand structural support, so we’ll also work to ensure that our partners have the right people, processes, and systems in place to launch and sustain the new products, helping with upskilling or capacity building as needed.
To create a financially inclusive world – to provide entrepreneurs with the means of hiring more employees, parents with the ability to save for the future, and communities everywhere with the tools they need to accelerate social and economic progress – we must develop financial products that clients trust, use, and benefit from. We’ll work alongside our Mexican and Chilean partners to create new solutions and services that help underserved families and businesses improve their financial health, and that realize the vision of a financially inclusive world. Follow us here as we keep you updated on our progress and process with our partners.
<img class="alignnone" src="http://accion-staging.flywheelsites.com/wp-content/uploads/2018/08/MetLife-Foundation.png" width="247" height="115" />This brief is a part of our <a href="https://www.accion.org/accion-and-metlife-foundation-announce-expanded-partnership-to-advance-financial-inclusion/">Building Financial Capabilities and Strengthening Institutions through Customer-Centered Innovations project</a>, supported by MetLife Foundation.
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“Financial health is achieved when an individual’s daily systems help build the financial resilience to weather shocks, and the ability to pursue financial goals.” Financial Health Network

Brief

<h2>The path to financial health</h2>
People around the world are continually aiming to improve their financial lives – they do so with whatever tools are available, whether formal or informal, and with whatever knowledge they have gathered. Every day, people work hard to grow their businesses, send their children to school, save, make ends meet, and troubleshoot during tough moments. Ultimately, they aspire for greater financial health and a better life for themselves and their families.
<img class="aligncenter" src="http://accion-staging.flywheelsites.com/wp-content/uploads/2019/02/CFSI-1.png" /><a href="https://cfsinnovation.org/">The Financial Health Network</a>, the  <a href="https://www.centerforfinancialinclusion.org/">Center for Financial Inclusion at Accion</a> and <a href="http://www.dalbergdesign.com/">Dalberg's Design Impact Group</a> developed a <a href="https://content.centerforfinancialinclusion.org/wp-content/uploads/sites/2/2017/03/FinHealthGlobal-FINAL.2017.04.11.pdf">framework of six indicators</a> for financial health in the developing world.
In order to help consumers improve their financial health, financial service providers (FSPs) can design products, tools and services that empower consumers to better understand and manage their finances and encourage them to improve financial habits. Focusing on financial health also has the potential to impact the FSP’s bottom-line: Gallup found that when customers feel that their bank <a href="https://news.gallup.com/opinion/gallup/176534/looking-customers-financial-table-stakes-banks.aspx">looks out for their financial well-being</a>, they are much more likely to be fully engaged with the bank.

However, in order for FSPs to successfully promote financial health, they first need to understand customers’ opportunities and obstacles to improving it.

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Achieving financial health in Mexico and Chile

metlife-foundation

MetLife Foundation logo

Michael Schlein

Article

When you grow up in a community, you understand it on a deeper level. You get to know the families next door, the businesses that work nearby, and the habits that characterize daily life.

For the last five decades, Accion has worked with over 110 partners in 50 countries, and in every instance, we’ve relied on our partners’ deep local knowledge of the needs, desires, and habits of their neighbors and clients. We may know something about global trends and innovations, but it takes a partner on the ground to help us tailor those products and services to meet the needs and solve the real challenges of our clients.

Increasingly, businesses are exploring how diverse perspectives and local insights like these drive innovation. In the introduction to <a href="https://www.mastercardservices.com/en/expert-insights/ceos-innovation-playbook">The CEO’s Innovation Playbook</a>, a report from Mastercard and Harvard Business Review Analytic Services that guides leaders to spark change, Ajay Banga writes that when an organization brings diverse insights and experiences together, it “end[s] up with a collective perspective that is both broader and deeper than any one perspective could be on its own.”

That’s why we work alongside leaders like these: they’ve grown up in the communities that they serve, know what problems must be addressed, and understand the differences that inclusive financial services can make.
<h3>Using AI, remote sensing, and automation to protect smallholder farmers </h3>
After growing up on a farm in Kenya, <a href="https://www.nytimes.com/2019/10/03/business/microinsurance-africa-thomas-njeru.html">Thomas Njeru </a>understood why so many of the world’s farmers are just one drought or disease away from devastation. "I remember during a drought year, some of my friends dropping out of school — they could not come to school hungry, and their parents could not pay the school fees. The majority of families in Africa are faced with the same precarious reality.” That motivated him to create <a href="https://www.accion.org/for-rose-in-kenya-crop-insurance-is-a-game-changer">Pula</a> with co-founder Rose Goslinga, which uses technology to provide smallholder farmers agricultural insurance and uses satellite data to help its clients gain higher crop yields. By combining artificial intelligence, mobile registration, remote sensing, and automated tools, Pula’s annual insurance premium costs farmers about $3 to $5 and helps them protect their crops and their livelihood.
<h3>Tapping into an Indian tradition to support small businesses</h3>
Growing up, Neeraj Bansal watched his entrepreneur father <a href="https://timesofindia.indiatimes.com/business/india-business/honey-no-money-dont-worry-credright-hain-na/articleshow/68118970.cms">struggle</a> to obtain capital and sustain his businesses. He also saw how India’s <a href="https://www.youtube.com/watch?time_continue=3&amp;v=hxvDtklQL8I">chit funds</a> — traditional lending groups similar to ROSCAs — used social trust and local knowledge to provide credit to entrepreneurs when banks wouldn’t. Today, India is home to roughly 5 million chit funds, some of which have been operating for years. They represent a wealth of high-quality user data that banks had overlooked. Neeraj co-founded <a href="https://www.accion.org/fintech-transforming-indias-chit-fund-industry-inclusive-finance">CredRight</a> to tap that information to help India’s micro, small, and medium enterprises (MSMEs) get the funding they need. By partnering with chit fund representatives and accessing member data, CredRight evaluates borrowers’ creditworthiness to provide MSMEs with inclusive finance quickly and inexpensively.
<h3> Helping people in informal settlements through insurtech </h3>
In South Africa, approximately <a href="https://www.ohchr.org/Documents/Issues/Housing/InformalSettlements/SERI.pdf">1 in 7 families lived in informal settlements</a> in 2016. In those communities, fire safety is a significant concern: between 2015 and 2016, <a href="https://www.cnn.com/2016/08/23/africa/lumkani-fire-detector-south-africa-2/index.html">fires</a> killed 32 people and damaged nearly 4,000 homes. After working on a solution to this issue while at Cape Town University, Francois Petousis, David Gluckman, and Paul Mesarcik co-founded <a href="https://www.accion.org/fire-insurance-provides-peace-of-mind-in-south-africa">Lumkani</a> to keep more South Africans safe. Lumkani provides residents in South Africa’s informal settlements with fire insurance and an internet-connected heat sensor that notifies all users if a fire is detected nearby. Eighteen months after launching, Lumkani demonstrated that, in 73 percent of cases, its technology helped <a href="https://www.accion.org/lumkani-uses-fire-insurance-to-protect-families-in-south-africa">prevent fires from spreading</a> beyond the first home.
<h3>Keeping corner stores stocked in Mexico and Peru</h3>
Neighborhood stores, or tiendas, are fixtures throughout Latin America. They’re essential for the people who live nearby as well as their local economies. But many of these mom-and-pop shops can’t get the financing they need to restock their shelves with snacks, drinks, and other goods when they need them. Dan Cohen helped create a company that solves this problem for storeowners and the vendors they work with: <a href="https://www.accion.org/five-small-business-owners-in-mexico-city-share-their-stories">Tienda Pago</a> provides entrepreneurs across Mexico and Peru with short-term working capital loans to purchase high-demand items. The company uses <a href="https://www.accion.org/how-banks-fintechs-and-corporations-can-expand-supply-chain-finance">supply chain data</a> to finance inventory payments, paying fast-moving consumer goods (FMCG) distributors directly; the distributors then deliver those supplies to the storeowners, who repay Tienda Pago via an electronic mobile payment platform.
<h3>Local needs and global goals</h3>
By living and working with their clients, these innovators developed new solutions that address specific needs from the ground up.

We should cultivate and support local innovation wherever we can: <a href="https://bankinnovation.net/allposts/biz-lines/payments/amazon-pay-launches-bill-inquiry-feature-via-alexa-devices/">Amazon</a>, <a href="https://www.businessinsider.in/finance/news/report-ant-financial-and-tencent-are-rapidly-growing-their-financial-services-ecosystems-heres-exactly-what-they-offer-and-where-we-think-theyll-go-next/articleshow/71696739.cms">Ant Financial</a>, <a href="https://www.nytimes.com/2019/06/18/technology/facebook-cryptocurrency-libra.html">Facebook</a>, <a href="https://www.cnbc.com/2019/10/30/sea-online-financial-services-to-generate-38-billion-revenue-by-2025.html">GOJEK and Grab</a>, <a href="https://www.cnbc.com/2019/10/28/uber-announces-deeper-push-into-financial-services-with-uber-money.html">Uber</a>, and many others are developing global super platforms that can immediately reach billions of people who have been left out of the formal financial sector. But to make the most of their platforms, these players should listen to and work with people already driving innovation in communities across the globe. These innovators know what it means to understand and address the fundamental, immediate human needs of the world’s underserved communities, including education, food security, home safety, and expanded economic opportunity.

When fintech innovation meets these needs, it makes an immediate impact on people's lives, but it also has long-term effects for families and communities. From ending hunger to achieving gender equality to promoting economic growth, <a href="https://www.uncdf.org/financial-inclusion-and-the-sdgs">financial inclusion is an enabler in more than half of the UN’s Sustainable Development Goals</a>.

That’s why supporting local innovation matters — because by understanding the unique needs of people in each market and creating solutions that fit their lives, we can finally build a safer, more equitable world for everyone.

Even in a world of global super platforms, local innovation still matters

María Belén Garrett

Ana Ruth Medina Arias

Business and financial training platform Ovante makes a difference for small business owners 

Maria Pico established her hairstyling business in Bucaramanga, Colombia, when she was 25. Today, a decade later, she finds herself wearing multiple hats — as an entrepreneur who is brimming with enthusiasm to grow her hair salon and as a mother who is eager to provide a comfortable life to her daughter.  

Over the years, Maria has built a loyal customer base and is usually booked with appointments. Nevertheless, she recently realized that growth was stagnating but wasn’t sure what she could do to take her business to the next level. While Maria had access to financial products that could help her invest in the business, as well as access to the internet to educate herself, she did not have the skills and training needed to effectively leverage these resources to boost the growth of her business. Maria’s case represents the plight of many micro-entrepreneurs whose aspirations are constrained by their lack of confidence in tools that can accelerate business growth. When Maria learned about <a href="https://www.ovante.org/">Ovante</a>, Accion’s fully digital and interactive business education program developed with support from FedEx, she knew it was for her. 

Ovante’s platform helps micro business owners learn critical business and financial concepts. They learn how to make smart decisions with their money, protect their businesses, and calculate their earnings, all while becoming more digitally savvy. Maria has learned how to better manage appointments, maintain budgets, track customer visits, and expand her customer base. Overall, the key lessons Ovante seeks to build are to:  
<ul>
 	<li data-leveltext="" data-font="Symbol" data-listid="4" aria-setsize="-1" data-aria-posinset="1" data-aria-level="1">Drive sustained business growth: Businesses have several cash flow sources, but these rarely become the income-generation source that business owners need to improve their lives. Ovante walks users through a step-by-step process to learn how to assess their business profitability and what to do to improve it. 
</li>
</ul>
<ul>
 	<li data-leveltext="" data-font="Symbol" data-listid="4" aria-setsize="-1" data-aria-posinset="1" data-aria-level="1">Plan for the long-term: Most microentrepreneurs have a daily or weekly plan for their businesses, but fewer have a longer-term vision for the month or the year. This impedes their ability to make better use of working capital loans or invest in inventory. Ovante helps them to review their money management habits and highlights how they could improve their business performance by setting longer-term goals and changing their behaviors to be more long-term oriented. 
</li>
</ul>
<ul>
 	<li data-leveltext="" data-font="Symbol" data-listid="4" aria-setsize="-1" data-aria-posinset="2" data-aria-level="1">Manage time and become more efficient: Business owners deal with an unending list of things to complete within a short time frame. They often find their business performance diminishing due to time constraints. Ovante helps users to manage their time better and provides recommendations of practices that could help them to be more productive and successful in their businesses. 
</li>
</ul>
<ul>
 	<li data-leveltext="" data-font="Symbol" data-listid="4" aria-setsize="-1" data-aria-posinset="1" data-aria-level="1">Branding and marketing through non-traditional channels: Most microentrepreneurs use traditional channels like word of mouth to expand their client base. Ovante helps users learn how to apply tools like social media marketing and branding to grow their customer bases — crucial factors for businesses like Maria’s. For instance, Microentrepreneurs learn how to start a Facebook page for their business, through which they can conveniently market their products and services. </li>
</ul>
Ovante uses interactive tools, including videos and techniques like gamification, to build users’ business capabilities. When her salon is quiet, or after locking up for the day and completing her household chores, Maria often finds a quiet corner to revisit and complete Ovante’s modules on her computer or cell phone. Ovante is enabling micro-entrepreneurs in Latin America to learn essential business skills from the comfort of their homes and apply the lessons to grow their businesses. Individuals who earlier struggled to use technology are increasingly becoming digitally savvy. According to reports collected by Accion’s technology provider <a href="https://www.colnodo.apc.org/">Colnodo</a>, nearly 92 percent of Ovante users say that it is their first time using a digital platform.  

[caption id="" align="alignright" width="440"]<img class="" src="http://content.accion.org/wp-content/uploads/2019/06/2018_Accion_Ovante_0074.jpg" alt="" width="440" height="293" /> Ovante helps entrepreneurs like Margarita develop their business skills and learn how to use financial products and services responsibly.[/caption]

Another entrepreneur, Margarita Viviescas, has worked as a florist, dressmaker, event designer, and masseuse for more than 20 years. Until she started using Ovante, Margarita’s exposure to digital technology was largely limited to using her smartphone to make phone calls and send text messages. By empowering Margarita to access information and improve her business in real-time, Ovante is providing her with exposure to digital technology. In discussing why flexibility matters to her, Margarita exclaimed, “I think it is very helpful that Ovante is digital because you can use it anywhere! It also solves the problem of limited availability of time because there is no set time to use this platform, which makes it more convenient to use.”  

Ovante helps thousands of entrepreneurs like Maria and Margarita, who face a myriad of business and household responsibilities, to better manage their lives. As of December 2019, Ovante has reached more than 15,050 low-income entrepreneurs, of which 81 percent are women. Recently, Ovante was selected as a winner of the <a href="https://www.worldsummitawards.org/2019/12/10/meet-the-40-winners-of-2019/">World Summit Awards</a> (WSA) in the category of learning and education for 2019. The WSA is a unique awards system, selecting and promoting local digital innovation which contributes to the achievement of the UN Sustainable Development Goals. It is an international platform for cutting edge examples of how Information and Communication Technology can positively affect communities, and only 40 solutions from 25 countries earned an award. 

Over the next 18 months, Accion plans to scale Ovante to multiple countries across Latin America and markets like India, where Accion has a significant local presence. As we continue to drive Ovante’s expansion, we hope that end-users will continue to build their business, financial, and digital capabilities and will further incorporate digital tools into their daily lives and ultimately into their businesses.  

 

Arisha Salman also contributed to this article.

Bridging the digital divide to help Latin America entrepreneurs

Justin Matheson-Turner

How one entrepreneur overcame Peru’s small business financing gap with Mibanco’s support


Freddy Mayta Quispe has a passion for natural products, specifically traditional Andean goods. He values the benefits these products have for health and wellness and wanted to share them with his community. “I love to use and consume these natural products. They don’t have preservatives — this is all-natural. It is very good for your health. And that is why I am dedicating my life to distributing them,” says Freddy.

Freddy also values his independence and knew he wanted to chart his own destiny. But when he began putting together his business plan, Freddy hit a hurdle in accessing the funding needed to get his idea off the ground. “I was looking for options, but no one wanted to give me a loan because I was looking for a significant amount — it wasn’t small — and they weren’t giving it to me.” Despite his great ideas and passion, Freddy faced a financing gap experienced by many micro-and-small entrepreneurs. The <a href="https://medium.com/accion/technology-keeps-small-businesses-well-stocked-and-growing-in-latin-america-6b358bcbbeba">Inter-American Development Bank</a> estimates the funding gap for Latin American medium, small, and micro-enterprises to be $250 billion.

[caption id="" align="alignright" width="451"]<img class="" src="http://content.accion.org/wp-content/uploads/2019/01/2018_Accion_MiBanko_Day1__1446.jpg" alt="" width="451" height="300" /> Freddy is working towards his goal of opening a supermarket specializing in Andean natural products.[/caption]

Luckily there are financial service providers that have made it their mission to fill the gap and meet the needs of small business owners like Freddy. In Peru, Accion partner, Mibanco, specializes in understanding the needs of entrepreneurs. They offer advice and loans that allow businesses to grow sustainably. Mibanco business manager, Roberto Gallardo Bejarano, says, “Here you have a company that has a purpose, and that purpose is to affect people’s lives. The financially inclusive part is giving them a chance — seeing their progress and how you can improve on that. So it makes you feel complete, and that, for me, is priceless.”

Mibanco could see the potential in Freddy’s business plan, and they did give him a chance. With advice and loans from Mibanco, Freddy has expanded his business and been able to provide a better life for his wife and two sons. But he still wants to achieve more, “Thanks to MiBanco, I have a house, I have a roof over my head. And I can give comfort and all these good things to my family, but there is still a long way to go and many goals I would wish to reach.”

Ultimately, Freddy dreams of opening a supermarket specializing in Andean natural products. With his drive to achieve his goals and a trusted partner like Mibanco, Freddy sees unlimited potential.

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Fresh from the Andes: An inspiring small business

Jeffrey  Campbell

Financial service providers can serve more customers by leveraging data and technology

How does a traditional bank go digital to serve more customers? Recently I visited Lagos, Nigeria, and La Paz, Bolivia, to see — and help drive — that process. In Lagos, <a href="https://www.accionmfb.com/">Accion Microfinance Bank</a> hopes to triple the number of people it serves through a digital-first model for acquiring new clients and improve internal processes. In La Paz, Accion is working with <a href="https://www.bancosol.com.bo/">BancoSol</a> to establish an innovation hub — a unit tasked with bringing better digital products to market, using a data-driven approach. Both projects are part of <a href="https://www.accion.org/mastercard-and-accions-partnership-to-unlock-millions-of-underserved-microbusinesses">Mastercard's ongoing partnership with Accion</a>.

For the last 14 years, I’ve worked with <a href="https://www.mastercardservices.com/en/solutions/test-learn">Mastercard</a> to fulfill the mission of bringing smart, data-driven decision making to the banking, retail, consumer packaged goods (CPG), hospitality, and automotive sectors. We help companies test ideas like “should I dramatically overhaul my stores and brand?” or “should I offer a 30 percent promotion, 35 percent, or buy one, get one free?” Getting these questions right can mean significant impacts on top and bottom lines.

In August, Mastercard gave me the opportunity to take on a new mission for three months: bringing a similar approach to solving big questions with data, analysis, and testing to Accion’s <a href="https://www.accion.org/how-we-work/advise/accion-global-advisory-solutions">Global Advisory Solutions</a> team. We are working with Accion’s partner organizations to leverage analytics to drive financial inclusion.

During my travels with Accion, I had the opportunity to speak with Accion Microfinance Bank and BancoSol’s senior leadership teams about their use of data and technology in building out their digital strategy. I also gave a presentation to each team’s leadership on how to conduct testing and analytics, and how it can help organizations achieve their growth ambitions.

I spent time with clients of each bank in their homes and at their places of business to learn more about how they use financial services. I was surprised at how accessible financial technology is for many entrepreneurs — one vendor's stall in Lagos was no bigger than my cubicle but featured a Point-of-Sale (POS) machine for credit cards. Even though that vendor was equipped to receive digital payments, they were hesitant to make electronic payments and deposits of their own. This disconnect reflects how much less customers trust their banks in Nigeria compared to customers in the U.S. One takeaway from speaking with customers in Lagos: we have a big task ahead in giving underbanked people reason to trust that digital banking will be safe, reliable, and easy to use.
<blockquote>We have a big task ahead in giving underbanked people reason to trust that digital banking will be safe, reliable, and easy to use.</blockquote>
In Bolivia, the challenge is less about trust-building and more about increasing people’s comfort and literacy around digital tools. Many entrepreneurs told us that they have a digital product but aren’t using it.

Like customer needs, degrees of digitization vary dramatically. At Accion Microfinance bank, the team is working to build a data warehouse to make analytics and reporting less manual. At BancoSol, the data warehouse has existed for several years and is impressive. It captures critical elements into a data server and then extracts commonly used information into reports automatically. It rivals the systems in place for banks in the U.S., and there are plans in place to make it even more powerful. BancoSol’s next goal is to leverage this well-captured data more effectively. That’s one of the mandates for the new innovation hub, and something we will be supporting them to implement.

In many ways, the challenges facing microfinance institutions look a lot like the ones facing the commercial banks that I work with at Mastercard. In both worlds, companies are looking to understand their customers' wants and needs and create a niche in a rapidly evolving market. They're both working to take down the overhead of branches and field staff while trying to expand reach digitally.

My visits were educational and eye-opening. It’s amazing to be part of an effort to expand the benefits of the global financial system to people who have not had them historically. The opportunity to speak directly to customers about their relationship with their financial providers was a good reminder that the customer should always be at the center of any initiative. Upon returning to Mastercard, I will be reminding my clients of this as well.

I am excited to support the Accion team to identify the role of data in making digital banking more accessible. From risk analysis to customer segmentation to operations and payments, when we leverage data, we can make financial tools more available — and more useful — to everyone.

Data is crucial for driving  inclusive growth

Apollo Agriculture supports smallholder farmers in ways old and new

Smallholder farmers in Kenya — like smallholder farmers everywhere — work very hard, and live precariously, always facing challenges from drought to floods to commodity market fluctuations. Margaret Auma Oyoko, who grows maize and raises cows, when asked to describe her day says simply, “When I wake up, I pray to God to help me in my activities like farming, feeding the cows, and other household duties.”

&nbsp;

[caption id="attachment_20230" align="alignleft" width="500"]<img class=" wp-image-20230" src="http://content.accion.org/wp-content/uploads/2019/12/Kenya_Nakuru_0030-2-1024x684.jpg" alt="Alfred in maize field" width="500" height="334" /> Alfred appreciates how healthy his crops are with Apollo’s fertilizer.[/caption]

<a href="https://apolloagriculture.com/">Apollo Agriculture</a>, an Accion Venture Lab portfolio company, was founded to help farmers like Margaret thrive in the face of their many challenges. When farmers become Apollo clients, they receive not only high-quality seeds and fertilizer but also advice to help them farm more effectively. 

Alfred first heard about Apollo from a friend who is also a farmer. He reports that he and several neighbors have all had positive experiences with Apollo so far. “Their fertilizer is very rich, which meant my crop yield was very high. After harvesting and selling my maize, I was able to pay the school fees,” he says, adding, “I’ve also learned so much more about agriculture. They teach us a lot and show us how to do farm work.”

[caption id="attachment_20232" align="alignright" width="500"]<img class=" wp-image-20232" src="http://content.accion.org/wp-content/uploads/2019/12/Nakuru_0023-1024x684.jpg" alt="Susan shows an Apollo agent her produce." width="500" height="334" /> Susan shows an Apollo agent her produce.[/caption]

Susan Wangui Wanjiru also learned about Apollo through a friend, and while like Alfred, she appreciates the quality of its products, she is especially impressed by its tech-enabled systems. She first signed up as a customer via text message and then an agent came to her property and assessed her farm. Says Susan, “The beauty of it is that Apollo does not give out cash to anyone, not even the agents. You send it directly to them [using M-Pesa]. You then get your balance as a text message.” For a busy farmer and mother, the convenience is invaluable.

Summing up his Apollo experience, Alfred says, “Before, I struggled to get farm inputs. The next problem was finances, as you have to buy everything with cash. It was also difficult to find people who could teach you something new. But now it’s better with Apollo.”

Seeds, fertilizer, mobile money: Kenyan farmers get the supplies they need

Archana Kejriwal

Financial literacy and capability programs support a growing middle class in India — now these programs are going digital

For families to get ahead, they need access to financial products and services. However, many people in India don't understand how to use these tools well, so they <a href="https://repository.lboro.ac.uk/articles/Conceptualising_financial_literacy/9494978">avoid them and avoid planning for the future</a>. This leaves them vulnerable to predatory lending, overselling, and fraud, and it can lead to crippling debt and poor financial management. Financial education can make all the difference by helping people to build <a href="https://www.centerforfinancialinclusion.org/what-is-financial-capability#targetText=Financial%20capability%20is%20the%20combination,access%20to%20appropriate%20financial%20services.">financial capabilities</a>.  Armed with the knowledge, skills, and self-efficacy needed to make the best money management decisions available, individuals can finally reach their economic potential.

For roughly two decades, Accion has included education and training services as important components of its financial inclusion work. As part of its client education programs in India, Accion has partnered with <a href="https://www.axisbank.com/">Axis Bank</a> to deliver programs inlcuding Mass Awareness Campaigns and the Money Plan Program. The former focuses on spreading awareness of basic financial concepts and the latter on creating awareness about the importance of keeping track of debt, savings, and expenses. Women are the main beneficiaries of these programs, which focuses on developing their decision-making skills to effectively drive women’s empowerment.
<h3>Mass Awareness Campaigns </h3>
Mass Awareness Campaigns focus on spreading financial literacy to low-income households across India, primarily in rural areas. The program uses tools like street plays, drama, and magic shows to teach all aspects of people’s financial lives, including earning, spending, saving, borrowing, and investing. It spreads awareness of good spending habits, monthly budgeting, identifying appropriate institutions, and avoiding risks. For many clients, this program is crucial for building initial awareness, inspiring financial conversations among family and neighbors, and driving them to seek out additional training. More than 15,000 individuals have participated in these campaigns, and many have gone on to take part in the Money Plan Program.
<h3>From awareness to the Money Plan Program</h3>
The Money Plan Program is a three-day in-depth workshop which focuses on building a deeper understanding of critical financial concepts. It focuses on improving the financial capacity of low-income women by giving them the tools to maintain their personal and household accounts efficiently. Through a set of modules, participants learn about financial planning, cash flow and budgeting, savings, debt, investment, insurance, and banking.

The initial results of the impact of program are promising. A survey of 9,000 women showed that it promoted significant behavior changes, especially in terms of financial discipline and budget planning. After the workshop, respondents reported a 27 percent increase in savings and an 18 percent increase in the use of bank accounts for saving. Interestingly, it wasn’t only attendees who benefitted. Respondents shared that after the program, their spouses also engaged in the financial planning exercises and in joint decision-making.
<h3>The road ahead for financial education programs</h3>
While the initial impact has been positive and women have been excited to use interactive tools for building their financial capability, scaling the programs has been challenging. They require large human resource investments, both in terms of time and money. Additionally, the programs do not permit real-time collection of data, which makes supervision and monitoring time-consuming and costly.

India is the world’s second-largest smartphone market and <a href="https://www.gsma.com/mobileeconomy/india">is expected to add over 330 million mobile subscribers by 2020</a>. Many of the new mobile and internet users have experience learning on digital platforms. This gives us the opportunity to build people’s financial capability through online and mobile channels. Mobile-based delivery of information, available whenever and wherever the learner needs it, would reach communities at greater scale than in-person programs currently can.

Accion has already rolled out such tools in Latin America.  The platform <a href="https://www.accion.org/these-women-are-growing-their-businesses-and-their-confidence">Ovante</a> is helping entrepreneurs build and enhance their business skills, grow their enterprises, and adopt healthy habits for using financial products and services. Users access the platform on their mobile phone or computer and receive information and tools to improve their business in real time. Based on the experience in Latin America, Ovante will be tailored for the Indian market and will aim to provide low-income microentrepreneurs with the tools they need to run their businesses and support their families and communities.

Arisha Salman contributed to this article. 

&nbsp;

What's next for financial education in India

On Thursday, families across the United States will sit down together for Thanksgiving. It’s my favorite holiday, and not just for the food. It’s a special moment that allows us to reflect on the things we’re grateful for and express our gratitude.

One of the things I’m most grateful for is the people, institutions, and partnerships that supported Accion over the last year. The work that we do alongside our partners allows us to help farmers improve their resilience, help parents pay for their children’s education, and build a world with more opportunities for everyone. From providing better crop yields to promoting economic growth to helping women gain autonomy, <a href="https://www.uncdf.org/financial-inclusion-and-the-sdgs">financial inclusion enables the UN’s Sustainable Development Goals</a> and creates a safer, more equitable world.

With your support, Accion has continued to work toward making full financial inclusion a reality. Together, we welcomed new leaders, created new partnerships and continued demonstrating how inclusive financial services can catalyze progress. In 2019, we:
<ul>
 	<li>Worked with Apollo Agriculture to <a href="https://www.accion.org/learning-new-skills-helped-this-longtime-farmer-thrive">teach smallholder farmers across Kenya</a> the best ways to use new fertilizers, plant their seeds, and use financing to grow larger crops.</li>
 	<li>Expanded <a href="https://www.accion.org/fintech-for-inclusion-why-accion-is-betting-big-on-startups">Accion Venture Lab’s work</a> harnessing <a href="https://www.accion.org/six-vital-trends-changing-the-future-of-fintech">emerging fintech innovations</a> to help people manage their daily lives, navigate unseen challenges, and capitalize on new opportunities.</li>
 	<li>Helped <a href="https://www.accion.org/these-women-are-growing-their-businesses-and-their-confidence">female entrepreneurs across Colombia grow their businesses and confidence</a> through a new interactive digital platform that teaches core business skills and promotes better financial habits.</li>
 	<li>Welcomed the Center for Financial Inclusion’s new Managing Director, <a href="https://www.centerforfinancialinclusion.org/q-a-with-mayada-el-zoghbi-cfis-new-managing-director">Mayada El-Zoghbi</a>. Mayada has been at the forefront of inclusive finance; she’s the right person to begin CFI’s next chapter protecting customers and researching the big, unanswered questions that we must answer to create a financially inclusive world.</li>
 	<li><a href="https://www.accion.org/the-faces-behind-mexico-citys-mercados-publicos">Connected Mexico City’s mercados públicos with the consumers that rely on them</a> through CÍVICO, a digital platform that helps Latin America’s entrepreneurs modernize their businesses and access financial services for the first time.</li>
</ul>
Those are just a few of the many highlights from a remarkable year: your support helped countless people and businesses around the world and will allow us to continue this important work. To everyone who gave or partnered with us in any way, thank you.

What you do for Accion means so much to so many: with 3 billion people still left out of the global financial sector, we have work to do. We’ll continue relying on you to help us create a world where everyone can meet their day-to-day needs, save for the future, and help their children learn and grow.

Thank you again, and happy holidays.

What I'm grateful for

Digital financial services platform Destacame leverages technology to streamline processes, reach new users, and provide customer service  

“Everything is based on technology,” says Camila Valdés who serves as the chief data officer for Accion partner <a href="https://www.destacame.cl/">Destacame</a>. The online platform enables users in Chile and Mexico to manage their financial lives, access free digital financial health tools, and see appropriate financial service offerings. From back-end development to the way users engage with the platform, innovative technology enables Destacame to understand and serve its customers better, and it will continue to be crucial as the fintech startup grows.

[caption id="attachment_17142" align="alignleft" width="500"]<img class=" wp-image-17142" src="http://content.accion.org/wp-content/uploads/2019/01/2018_Accion_Destacame_Day1__0352-1024x768.jpg" alt="Destacame employee Nel Pérez" width="500" height="375" /> “Technology used in the proper way can make a huge difference in people’s lives,” says Nel Pérez.[/caption]

Nel Pérez is Destacame’s chief technology officer, and he’s the perfect person for this job. Even as a child, Nel was tech-obsessed, focused on learning everything he could about computers and programming. “It was love at first sight with technology,” he says. Despite his abiding infatuation, he emphasizes that his role is not about employing technology for technology’s sake — it has to have a purpose: “It’s not about the technology — it’s about the needs we have that technology can help solve.” Internally, this means leveraging data analytics, cloud storage, and other solutions to keep all of Destacame’s processes running smoothly.

Technology is also the vehicle Destacame uses to connect with its users externally since they can access the service from their own computers or mobile devices, wherever they are. This ability to interact with users regardless of distance is crucial for Destacame’s mission and growth. “Technology allows us to have more of a range, so we can reach the community, whereas before it was impossible because it was not cost-effective. It also allows you to attend to each person’s needs individually. So it’s a service that suits everyone,” says Camila.

[caption id="attachment_17156" align="alignright" width="501"]<img class=" wp-image-17156" src="http://content.accion.org/wp-content/uploads/2019/01/2018_Accion_Destacame_Day1__0909-1024x682.jpg" alt="Destacame employee Virginia Chacón " width="501" height="334" /> Virginia Chacón discusses how Destacame builds customer relationships using technology[/caption]

And technology’s not just useful for reaching new users — it also assists Destacame in building existing customer relationships. “It helps us have a very close relationship with users,” says Virginia Chacón, Destacame’s head of operations. “We can even use Whatsapp to contact our users.” Staying in touch digitally helps Destacame provide customer service and make sure users can all receive the right messages at the right time to take advantage of credit-building opportunities, access services, and build their financial health.

As Destacame continues to grow, the fintech startup is finding even more ways to leverage technology to improve its platform, and José Luis Birrer, Destacame’s product manager in Chile, helps guide that process. Unlike his colleague Nel, José Luis never planned to work in technology, but after interning at a tech company, he found a sense of purpose in the work: “Technology allows people to use data in a better way — better products and better access to services.” He designs new products and implements improvements for existing ones with two factors in mind: first, solving users’ problems, and second, making sure it’s profitable so that Destacame can continue to scale and reach more customers. To inform its development, Destacame analyzes data to understand its users better and build products that meet their needs. “It’s about getting to know our clients so we can see what they need and how we can help fulfill those needs,” says José.

[caption id="attachment_17148" align="alignleft" width="500"]<img class=" wp-image-17148" src="http://content.accion.org/wp-content/uploads/2019/01/2018_Accion_Destacame_Day1__0516-1024x682.jpg" alt="José Luis Birrer, Destacame’s program manager in Chile" width="500" height="333" /> José Luis Birrer, Destacame’s program manager in Chile[/caption]

To help fulfill customers’ needs, Destacame is <a href="https://www.accion.org/achieving-financial-health-in-mexico-and-chile/">currently working with our Global Advisory Solutions team</a> on providing even more robust services. The project, supported by MetLife Foundation, will expand Destacame’s platform to include a financial health dashboard that clearly assesses users’ financial health and sets a roadmap to help them achieve their long-term plans. The platform will also recommend additional products, services, and tools for paying down debt, starting a business, saving for school, and more — these recommendations will evolve along with each user’s financial situation, helping them to take the right steps at the right time to live a financially healthy life.

“Technology used properly can make a huge difference in people’s lives,” says Nel, summing up why technology is so crucial for Destcame’s mission. By always putting users’ needs at the center and emphasizing financial capability-building, Destacame is making the most of technology and setting an example of how inclusive fintech can improve lives.

Fintech fuels inclusive growth for Destacame

Mibanco uses human interaction and financial technology to serve MSME clients in Peru

Facing a <a href="https://www.smefinanceforum.org/data-sites/ifc-enterprise-finance-gap-0">$17 billion gap funding gap</a>, Peru’s micro, small, and medium enterprises are often left without the capital they need to grow or even make ends meet. Often the businesses that are the most underfunded are small, rural, and women-run.

This important segment of Peru’s economy is where Accion partner, <a href="https://www.mibanco.com.pe/">Mibanco</a>, specializes. Mibanco has years of experience in providing financial services to small businesses and emphasizes building long-term relationships with its clients. “Micro and small businesses are the heart and spinal cord here in South America. They make up 90 percent of businesses here. And even though they are spread out, they are the base of business and the economy,” explains Mibanco branch manager Roberto Gallardo Bejarano. Mibanco recognizes that supporting MSMEs powers large scale economic growth. 

[caption id="" align="alignleft" width="511"]<img src="http://content.accion.org/wp-content/uploads/2019/01/2018_Accion_MiBanko_Day2__0059.jpg" alt="" width="511" height="340" /> Mibanco is a pioneer in using technology to streamline processes and make their services even more accessible.[/caption]

Supporting these critical businesses creates ripples throughout communities and helps build a more vibrant economy. Mibanco client Tarsila Apaza has seen the growing impact of Mibanco as more of her fellow business owners and neighbors have begun working with the bank. “My colleagues around here also work with Mibanco so sometimes when I go to pay at the bank I see them there and I’m like “hey, you’re also here!” So yes, they have helped many of us around here,” she says.

Mibanco’s success in serving small — and often rural — businesses relies on its network of agents that go out to the field to connect with clients. Mibanco has also been a pioneer in using technology to streamline processes and make their services even more accessible. Through a digital app, agents can quickly input customer data during their field visits and manage loan disbursement and payments. Coupling technology with human interaction allows Mibanco to better understand their clients and provide them with more effective services. “We are working with business people — people who need to be at their businesses, and don’t want to take time to go to the bank. So we want to go to them,” says Roberto. 

[caption id="" align="alignright" width="536"]<img src="http://content.accion.org/wp-content/uploads/2019/01/2018_Accion_MiBanko_Day2__0495.jpg" alt="" width="536" height="357" /> Roberto Gallardo Bejarano, a Mibanco branch manager, pairs customer service with innovative digital products to serve MSME clients in Peru. [/caption]

The goal is to provide resources and insights in addition to financial services that enable small businesses to grow responsibly. Most clients begin with small loans and build up to larger amounts as their relationship with Mibanco deepens. “They start with small credit and over time they have grown to be able to ask for more credit,” says Jorge Pucurimary Gutierrez, a Mibanco manager. 

For microentrepreneurs, it is critical that they have the knowledge and resources to grow sustainably. By starting with small loans and building to larger amounts, business owners learn how to manage their finances and grow their enterprises. Mibanco is serving a traditionally excluded, but immensely important, segment of Peru’s population. Small businesses drive the economy and by providing relevant products, Mibanco is helping families to do better financially and to build better futures.

How to reach underserved Peruvian small businesses

“This business is part of my family,” says small business owner Joaqium


Joaquim owns a garment business in Mozambique, and it’s a family affair. “I started the business myself,” he says. “I then got married, which was nice because my wife was also in this kind of work, making clothes. So we put our hands together and started working together. My son is at school, studying things that relate to the business.” The feeling extends to his staff; as he puts it: “The people working here are not employees. I consider them family, because we’re all helping each other.”

[caption id="" align="alignright" width="506"]<img src="http://content.accion.org/wp-content/uploads/2019/11/Socremo_Clients_0010.jpg" alt="" width="506" height="337" /> Joaqium examines material at his family-owned garment shop in Mozambique.[/caption]

Back when Accion portfolio partner Socremo Bank was getting established in Joaquim’s area, he wasn’t sure he needed a loan. “I found Socremo because they were going around looking for people to make business with. They came three times, but I wasn’t interested. Then they sent me an invitation to come to their branch and explained who they were, so I got a loan and started working with them,” he says. Now, he’s glad he did. “I think they are a great bank, and I know I am only where I am now because of Socremo. The bank made a huge difference for me, my family, and the community,” he says. 

Joaquim is looking forward to continuing to grow his business, which again he puts in terms of relationships. As he says, “This business is part of my family, so if I make it bigger, my family will also grow.”

Stitching together family and entrepreneurship in Mozambique

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