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.

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Michael Schlein

Advances in digital technology will be key to reaching underserved populations as we confront unprecedented challenges.

Article

Before the COVID-19 pandemic changed our world, people like Laal Kumari Singh in rural India faced significant challenges to building a secure future. Laal relies on her cattle rearing business to feed her family, but she has struggled to access the financial tools she needs to save, grow, and protect herself from unexpected emergencies.

<a href="https://subk.co.in/" target="_blank" rel="noopener noreferrer">Sub-K</a>, an innovative microfinance enterprise in India, uses a digitally-enabled model and <a href="https://www.accion.org/instead-sending-people-bank-sub-k-brings-banking-people">a large network of agents</a> to reach underserved people in rural communities and connect them to banks. Before Laal became a client of Sub-K, her milk business owned five cows. Now, thanks to Sub-K’s efforts to serve her rural community, her herd of cows, calves, and buffaloes has grown to nearly 40, producing 30 to 40 liters of milk for her to sell each day. Because of Laal’s success, she’s been able to support her three kids: two sons and one daughter.

Millions of small business owners like Laal operate in India and around the world, each working hard to support their families and answer a need in their communities. When these enterprises thrive, so do the families and communities that depend on them. But amid the global economic uncertainty caused by COVID-19, these businesses are struggling to access capital and maintain operations, while the financial service providers who support them face <a href="https://www.accion.org/the-financial-engine-for-half-the-worlds-jobs-is-about-to-seize-up">a serious credit crunch of their own</a>.

Accion is a global nonprofit dedicated to creating a financially inclusive world. Today, we’re harnessing the power of digital technology to achieve that goal as we find, fund, and grow companies like Sub-K that are finding new ways to reach the underserved. Ultimately, we seek to support the three billion people who are left out or poorly served by the global financial system, and who are uniquely vulnerable to the effects of the pandemic.

As Sub-K’s success shows, advances in digital technology will be key to reaching underserved populations as we confront unprecedented and evolving challenges. While Sub-K is a more established partner of Accion’s, our seed-stage investing initiative Venture Lab partners with innovative fintech startups around the world.

Venture Lab’s portfolio companies have provided us with the means to harness emerging fintech trends in a sustainable, scalable way. Its partners have found new ways to protect millions of people with insurance for the first time; helped more consumers and businesses make quick, safe, digital payments; and pioneered ways to lend tens of millions to small businesses and their customers.

<a href="https://pintek.id/" target="_blank" rel="noopener noreferrer">Pintek</a>, a partner of Accion’s in Indonesia, is a financial technology startup aiming to democratize access to education in Indonesia through affordable and flexible credit for schools and students. Indonesia’s public universities have limited capacity, so Pintek helps the many low- and middle- income families in Indonesia <a href="https://www.accion.org/making-education-accessible-through-fintech">who turn to private schools</a> for education, but often struggle to afford tuition.

To help students and schools facing disruptions to learning due the pandemic, Pintek has partnered with edtech platforms and school management systems to help schools access financing for these products and develop their online learning capabilities. Pintek has also maintained active conversations with their customers, sending out surveys to understand their needs and how Pintek can assist. Pintek is also taking this time to improve internal processes and systems and upgrade their technology.

This progress has helped build financial resilience at a time when it’s vitally important. And if we build resilience now, we can ensure that future challenges – like natural disasters and other shocks arising from climate change – don’t devastate the global economy or push underserved populations deeper into poverty.

These pioneering startups also offer new ways to meet the UN’s sustainable development goals to help fight poverty, empower women and girls, and provide access to a good education. The sustainable development goals were important before the pandemic—achieving them is going to be more complex and more urgent.

Investing in these companies and their innovations can provide us with powerful new tools to create a safer, more equitable world.

How impact investing can build financially resilient communities

An interview with Community Investment Management’s Jacob Haar on VentureKast: Rebuild

Podcast

[embed]https://soundcloud.com/accioninternational/time-to-shine-for-innovative-fintech-lenders[/embed]

"Lending partners that have access to real-time data are at a significant advantage to provide credit in this market,” explains Jacob Haar, the Managing Partner at Community Investment Management and the first guest of our new VentureKast season, <a href="https://www.accion.org/series/venturekast-rebuild" target="_blank" rel="noopener noreferrer">VentureKast: Rebuild.</a>

We spoke with Jacob about the challenges that many lenders are facing as a result of the COVID-19 pandemic and how fintechs are uniquely positioned to respond to challenges and continue driving inclusive finance in this environment.

As an investor, Jacob highlights the value of “capital that understands how to lend to underserved customers, how to rely on innovation to lower costs, [and] align incentives with the underlying borrower that you are trying to serve.” Although this period has been immensely difficult for many lenders and their borrowers, the fintechs that capitalize on their innovation have the opportunity to help lead a fundamental shift to digital financial services. In other words, says Jacob, for fintechs “this is their time to shine.”

Please join our host and co-Managing Director of <a href="https://www.accion.org/how-we-work/invest/accion-venture-lab" target="_blank" rel="noopener noreferrer">Venture Lab,</a> <a href="http://content.accion.org/people/vikas-raj/" target="_blank" rel="noopener noreferrer">Vikas Raj</a>, as he interviews industry leaders every Thursday on how COVID-19 is impacting their work.

Time to shine for innovative fintech lenders

Victoria White

Economic recovery depends on the future of small businesses. Financial service providers have a critical role to play in ensuring low-income communities aren't left behind.

As the economic effects of the coronavirus pandemic hit cities and towns around the world, small business owners face major challenges, on both the supply and demand side, to keep their businesses running. These entrepreneurs are often risking their savings, and sometimes their health, to generate income to survive, and they need urgent support to keep going. Beyond providing essential goods and services in their communities, these businesses account for nearly half of the world’s jobs. If they collapse, global economies won’t be able to recover.

Financial service providers (FSPs) that serve low-income individuals and businesses need to act now to support families and communities. These providers must consider near-term challenges while positioning themselves for a very different future. Though we don’t know what the post-crisis world will look like, one thing is certain: given the speed at which the virus has spread and the depth of its devastation, a passive response from financial service providers is not an option. Once the immediate crisis has passed, the future viability of these institutions will depend on how quickly they can <a href="https://www.accion.org/how-three-financial-service-leaders-are-adapting-to-covid-19" target="_blank" rel="noopener noreferrer">adapt to new circumstances</a> and gain momentum that will drive efficiency and growth.

Accion Global Advisory Solutions is focused on building the resilience of financial service providers and their ability to support their clients who need their help to weather this crisis. Innovations in fintech and digital transformation will help financial service providers continue to offer needed services to their clients and remain viable themselves during these extraordinary times. We are working with our partners around the world to <a href="https://www.accion.org/responding-to-the-pandemic-guidance-for-financial-service-providers" target="_blank" rel="noopener noreferrer">help them navigate the crisis</a> so they can help their clients rebuild and relaunch their businesses.

[caption id="attachment_21265" align="aligncenter" width="800"]<img class="wp-image-21265" src="http://content.accion.org/wp-content/uploads/2020/05/chart.png" alt="Accion services to support MSMEs" width="800" height="352" /> Accion Global Advisory Solutions services to support MSMEs recovery from the COVID-19 crisis [/caption]

To fuel the recovery for low-income individuals and micro, small, and medium enterprises (MSMEs), we are working with our partners to:
<ol>
 	<li>Conduct data-driven client impact analysis: Quarantine measures have impacted businesses and industries in different ways. Retailers selling essential items like food and toiletries have remained open, whereas hairdressers, apparel stores, and restaurants, have been forced to close and suffer losses. Because the pandemic has impacted sectors differently, it is important to be sensitive and responsive to the unique needs of clients. <a href="https://www.accion.org/data-management-and-analytics-capabilities" target="_blank" rel="noopener noreferrer">Data-driven client impact analysis</a> helps FSPs respond to clients in a targeted manner — delivering relevant education, marketing messages, and innovative disbursal and collections strategies. Additionally, this analysis allows FSPs to understand how their portfolio will be impacted based on which segments of the economy they serve.</li>
 	<li>Develop a collections and delinquency management plan: Because of their reduced income, many clients are struggling to make repayments. It is critical to develop a customer-centric collections strategy and delinquency management plan. Evidence from past crises shows that the majority of clients want to repay loans to trusted FSPs and maintain a good relationship for future financial needs. Collections management should be clearly defined and follow client protection principles.</li>
 	<li>(Re)launch digital channels with vigor: In an environment of mandated social distancing and lockdowns, <a href="https://www.accion.org/aye-finance-tackles-msme-credit-gap-in-india" target="_blank" rel="noopener noreferrer">digital and alternative channels</a> — mobile, card, ATM, internet banking, and agent networks — have become even more important as they ensure that clients can still complete transactions. FSPs need their digital channels to be stable and robust enough to handle more transactions as clients turn to digital channels to repay loans and seek other financial services. Many of these clients will need guidance and training to build comfort and trust in digital channels, especially those that are first-time users.</li>
 	<li>Build a client engagement plan: Financial service providers should be a trusted partner to their clients. To provide immediate support, FSPs should relay important health and safety guidelines from local health authorities and share updates about their own response in a friendly and understandable way. They should also communicate information regarding loan moratoria and adjusted repayment schedules clearly and through a variety of channels. Providers can offer <a href="https://www.accion.org/margarita-prepares-her-business-for-the-digital-age" target="_blank" rel="noopener noreferrer">education, mentoring, and tools</a> to help microbusinesses rebuild or, in some cases, pivot and start a new business while embedding best practices to build financial health and resilience.</li>
 	<li>Assess liquidity requirements: Maintaining sufficient financial liquidity is vitally important for on-lending, operating expenses, and capital purchases. As the risk of defaults has risen, levels of portfolio-at-risk will increase. In many countries, FSPs have faced government moratoriums on client repayments, but not always been able to negotiate rescheduling their own borrowing, which exacerbates the liquidity pressures. These combined factors have triggered a more urgent need for <a href="https://www.accion.org/the-financial-engine-for-half-the-worlds-jobs-is-about-to-seize-up" target="_blank" rel="noopener noreferrer">debt liquidity from third parties</a>, many of whom are themselves facing liquidity pressures. Developing a cohesive funder strategy is critical to an FSP’s ability to manage through such shocks.</li>
 	<li>Embrace digital business models: The need for digitization of FSPs, to help reduce their operating cost and to support micro and small businesses remotely, is more apparent than ever. This includes the development of data-driven, technology-enabled products, channels, underwriting, and operating processes. Through <a href="https://www.accion.org/navigating-digital-transformation-is-complicated-so-we-made-a-map" target="_blank" rel="noopener noreferrer">digital transformation</a>, FSPs can build business models that serve existing clients better and help new clients through remote onboarding.</li>
 	<li>Reignite seized supply chains: <a href="https://www.accion.org/how-supply-chain-finance-can-help-microentrepreneurs-during-a-global-pandemic" target="_blank" rel="noopener noreferrer">Supply chains depend heavily on MSMEs</a>, both for production and sales. These MSMEs can constitute up to half of revenues for the largest consumer goods companies. Supply chains everywhere are being impacted by decreased demand from these businesses or suppliers’ inability to complete orders. While production will require concerted efforts of supply chain anchor firms, retail sales can be sustained through greater financing flexibility for merchants and their distributors. Supply chain finance offers a realistic and short-term means of extending funds using data and technology.</li>
 	<li>Support the digital transformation of microbusinesses: Given the massive impact this crisis is already having on the economy worldwide, there is an urgent need to reimagine how MSMEs — which account for <a href="https://www.un.org/en/events/smallbusinessday/" target="_blank" rel="noopener noreferrer">90 percent of businesses</a> in emerging countries — buy, sell, and operate. As digital platforms become ever more pervasive, businesses can leverage new tools to rebuild and relaunch. One way to enable the digital transformation of small businesses is through <a href="https://www.accion.org/the-digital-transformation-of-microenterprises-a-path-forward-in-a-post-covid-19-world" target="_blank" rel="noopener noreferrer">an ecosystem approach</a>: a marketplace for business opportunities, training for entrepreneurs to plan for the future and leverage these platforms, and the financial support to fund capital needs. E-commerce marketplaces and FSPs need to collaborate to identify MSMEs that could embrace new business opportunities, share data responsibly to build pragmatic data-driven risk models, and offer financial products.</li>
</ol>
In almost every crisis in the past, underserved <a href="https://www.accion.org/how-some-small-businesses-are-thriving-during-the-covid-19-crisis-in-india" target="_blank" rel="noopener noreferrer">MSMEs have proven themselves to be resilient</a>. They are hardworking and industrious, and they have little choice but to rebuild their livelihoods and thrive. But they don't have to do it on their own. For these businesses and the communities they serve, financial inclusion is more important than ever. Financial service providers have a critical role to play in mitigating the immediate effects of the crisis on low-income individuals and small businesses and building the financial health of their clients in the long run.

Accion is helping our partners to leverage digital technologies and respond effectively to help their staff, businesses, and clients to cope with the crisis and build resilience for the future. Accion Global Advisory Solutions stands ready to advise and assist as we collectively adapt to a new normal. <a href="mailto:GLASSupport@accion.org" target="_blank" rel="noopener noreferrer">Contact us</a> to learn more about how we help financial service providers put these strategies in action.

Eight ways financial service providers can drive economic recovery

Speakers

Three of our leading partners share their frontline perspectives on the response to the COVID-19 crisis, and how our work is furthering financial inclusion and resilience.

Webinar

[embed]https://vimeo.com/430045688[/embed]

Accion is proud of our work to help move millions of people out of poverty around the globe since we began operating in 1961. But we are gravely concerned that these gains may be compromised because of the current crisis. Before the COVID-19 pandemic, 3 billion people around the world lacked access to the basic financial tools they need to save money, seize opportunities, or protect themselves from sudden emergencies. Now these people are even more vulnerable. The way that we respond now can ensure they don’t fall further behind in a post-pandemic world. Watch this webinar to learn more.

Accion is working to respond and adapt to the challenges presented by COVID-19. We offer solutions that help people stay resilient during this difficult time and leverage digital technology to help financial service providers and small businesses continue to function and stay connected with their low-income clients. Philanthropy from institutions and individuals allows us to be pioneering and create demonstration models that encourage further action. Because we’re a nonprofit, we can take informed risks that for-profit entities can’t or won’t—especially amid a global crisis—and cultivate new products, markets, and policies that benefit underserved people.

Supporting inclusive recovery from COVID-19: A conversation with Accion and our partners

An interview with Flourish's Tilman Ehrbeck on VentureKast: Rebuild

[embed]https://soundcloud.com/accioninternational/return-to-a-better-tomorrow-flourish-ventures-tilman-ehrbeck/s-2hMaMmRbpfF[/embed]

In uncertain times, investors and entrepreneurs should "return to first principles," says Tilman Ehrbeck, Managing Partner at <a href="https://flourishventures.com/" target="_blank" rel="noopener noreferrer">Flourish Ventures</a>. "Start with your customers, what do they need, what are true pain points, and what can you do to help them to improve their lives.” On episode two of <a href="https://www.accion.org/series/venturekast-rebuild" target="_blank" rel="noopener noreferrer">VentureKast: Rebuild</a>, Tilman shares his customer-centric philosophy and explains how the acceleration of digital engagement has dramatic potential implications for financial inclusion – “both the need and the opportunity to get there.”

Impact investing "is more relevant than before,” says Tilman, who reminds us that even “in the best of times, it's hard to be a startup entrepreneur. And if you have a crisis like this on top, it’s really, really taxing.” Tilman shares insights about supporting portfolio companies, and he remains cautiously optimistic about the future of investing during the pandemic. The pre-COVID-19 normal had its shortcomings, explains Tilman, and there now exists an opportunity to “embrace the notion of ‘let's return to a better tomorrow” by optimizing technology and financial systems.

Please join our host and co-Managing Director of <a href="https://www.accion.org/how-we-work/invest/accion-venture-lab" target="_blank" rel="noopener noreferrer">Venture Lab</a> <a href="https://www.accion.org/bio/vikas-raj" target="_blank" rel="noopener noreferrer">Vikas Raj</a> as he interviews industry leaders every Thursday on how COVID-19 is impacting their work.

Return to a better tomorrow

Ashley Lewis

Field Intelligence removes obstacles for community pharmacies in Nigeria and Kenya so they can focus on providing their patients with quality healthcare

When people have access to the healthcare they need, their quality of life improves, they are better equipped to tackle challenges, and they are more prepared to seize opportunities to build a better future for themselves and their families. Pharmacies play a critical role in their communities by providing people with the medicine, vitamins, and other essentials that improve their well-being. But community pharmacies can be overwhelmed by the same problems that other small businesses face: unpredictable demand, difficulty tracking inventory, and cash flow constraints when stocking their shelves. The COVID-19 pandemic has exacerbated all of these problems. Field Intelligence, <a href="https://www.accion.org/this-company-is-making-healthcare-more-accessible-in-emerging-markets" target="_blank" rel="noopener noreferrer">a startup operating in Nigeria and Kenya and a part of Accion Venture Lab’s portfolio</a>, is addressing these challenges for pharmacists so that they can concentrate on treating their patients.
<h2>Getting vital prescriptions onto pharmacy shelves</h2>
Field uses a combination of data-driven supply chain management software and delivery services to supply community pharmacies in Kenya and Nigeria with the right products at the right time. These pharmacies use <a href="https://shelflife.co/" target="_blank" rel="noopener noreferrer">Shelf Life</a>, Field’s pay-as-you-go subscription service, to order medicine and other products for their shelves. Because Field doesn’t require Shelf Life users to pay for goods until after they’ve sold them, pharmacists don’t have to worry about securing cash upfront to order what their patients need. Ijeoma Cynthia Uzor of Arrow Aid Pharmacy in Lagos describes her experience with Shelf Life, saying, “A lot has changed with Shelf Life compared to my other suppliers. Like the cost of procurement has actually reduced because I do not stress myself trying to raise money to buy the products before I sell.”

Shelf Life also helps pharmacies cut costs by tracking the expiration dates of the prescriptions that they already have in stock. Rather than take a loss from these drugs if they expire before they can be sold, Field Intelligence takes them back without charging pharmacies. “Once you notice that drugs are approaching expiration date, you notify them, and they come and take them away. That’s another beautiful benefit you are getting from Shelf Life,” explains Ikechukwu Okwor, owner of Peak Choice Pharmacy in Mararaba, Nigeria. Ikechukwu saved 6.7 million naira in working capital in the first nine months of using Shelf Life to manage his inventory and avoided losses from expired medications.

Being able to pay as inventory is sold and avoid lost revenue from expired goods is especially helpful during the pandemic, when shifting customer demand has created a cash crunch for local businesses around the world. Pharmacies can keep up with the fluctuations in demand for what community members need without having to pay upfront to do so. ‘’The pandemic has added an urgency to the need for a rethink of operational tools and business capabilities available to community pharmacies, and we are at the fore of providing services to achieve this,” says Suleman Sule, Country General Manager and Pharmacy Director of Shelf Life Nigeria.

[caption id="attachment_21611" align="alignnone" width="750"]<img class="wp-image-21611" src="http://content.accion.org/wp-content/uploads/2020/06/Portrait-Peak-Choice-Pharmacist-4.jpg" alt="" width="750" height="500" /> Ikechukwu Okwor stands in his pharmacy in Mararaba, Nigeria. he has saved over 6.7 million naira in working capital thanks to Field Intelligence’s Shelf Life service.[/caption]
<h2>Keeping pharmacies open during the pandemic</h2>
Pharmacies are playing a critical role on the frontlines of the pandemic. Not only do they give communities access to the medicines and health products they need, but they also reduce the number of unnecessary doctor and hospital visits which lessens the burden on overwhelmed healthcare systems. Making sure pharmacies can provide for communities is essential, but they're facing many challenges during the pandemic.

On top of changing customer demands, the pandemic has created new disruptions in global supply chains, especially those related to medical supplies. Field Intelligence is actively recommending product substitutions when available so that their clients can stock alternatives for supplies that have become scarce. “This has been especially useful as we see an increase in demand for products these community pharmacies do not usually serve, like rapid diagnostics test kits, simple medical devices for homecare, personal protective equipments, personal hygiene products that are of great need during this period,” says Ajiffa Labor, Country Manager and Pharmacy Director of Shelf Life Kenya. Field Intelligence has also temporarily migrated as many clients as possible to longer supply periods to bolster inventories and reduce the amount of human contact that more frequent delivery schedules require.

Beyond continuing to supply pharmacies during these disruptions, Field Intelligence has taken other steps to support their clients during this time. When the coronavirus outbreak escalated in March, they rolled out an infection prevention campaign where they distributed handwashing stations and educational posters to over 150 pharmacies in under a week. They also began sending weekly newsletters to share guidance for pharmacies and updates on supply availability in the market and viable substitutes for products whose supply chains had been affected.

Whether or not a community is facing a public health emergency, pharmacies need to provide their patients with the medications they need to stay healthy. When pharmacists have a tool like Shelf Life that helps them operate their business more efficiently, they can be even more effective for the people that rely on them and better prepared to endure unexpected challenges.

Community pharmacies use new tech platform to keep shelves stocked

Liza Guzman

Microentrepreneurs around the world are reinventing themselves. How can financial service providers help them evolve?

Low-income microentrepreneurs across the globe have been forced to make an impossible decision: risk their health and safety to remain operational, or shutter their doors and risk their income and savings to ensure the health and safety of their family. For those who have kept their businesses open, COVID-19 has introduced a new world order where people are being asked to limit human interactions in favor of a more digital, remote way of living. But many microbusinesses around the world, which rely heavily on selling and marketing their products in person, as well as on physical storefronts and the use of cash, are unprepared to operate digitally. Small businesses account for nearly <a href="https://www.worldbank.org/en/topic/smefinance" target="_blank" rel="noopener noreferrer">50 percent of global GDP</a> and are vital to the communities in which they operate, and they need help to stay open in our new reality. Now more than ever, it is the responsibility of the financial inclusion community to ensure that technology is an enabler and not a new barrier to economic success.

We’ve seen that when micro and small enterprises have digitized at least part of their business, or reimagined their business altogether, they have been better off during the pandemic. Those who lack digital savviness haven’t been able to adapt as successfully. Many microentrepreneurs in the developing world are not active users of digital services for a variety of reasons, including access, age, cost, and lack of confidence in using new, unfamiliar tools. As digital capability increasingly becomes tied to economic activity, the digital divide will widen and further exclude the world’s poorest citizens. We must help microbusiness owners develop the skills they need to understand and confidently use digital tools to help them survive and succeed.

Financial service providers (FSPs) — who are already closely intertwined in the lives of microentrepreneurs — need to understand that digital transformation starts with their customers. This strategic clarity will allow them to execute a holistic and successful digital transformation that benefits both their organization and their customers. There is a stronger business case for investments in technology and digital financial services when customers become comfortable using these tools, market size will expand. During the current pandemic, FSPs have a clear opportunity to leverage adoption and usage of their digital financial products on the intention of their clients to actively look to be part of the digital world. Now is the time to relaunch those digital channels that have not worked well in the past, introduce digital products and services that can improve customers’ business opportunities, and embrace customer-centric product design processes.

For example, these institutions can help to enable cashless payments and quickly deliver relief funding to clients. They can also relaunch their banking apps and highlight the top benefits and features that are most relevant to their customers’ current challenges. They can use simple channels like WhatsApp for onboarding and customer support, and to offer interactive learning tools that build confidence and boost motivation for clients to embrace a digital transformation of their businesses. For example, Banco Pichincha is helping small businesses in Ecuador <a href="/helping-small-businesses-build-resilience-in-ecuador">restart their businesses using credit from a digital supply chain product and a new platform to accept digital payments</a> — tools we're helping them develop as part of our project with the Mastercard Center for Inclusive Growth. To complement the strategy, Banco Pichincha is giving clients access to Ovante, Accion’s digital platform designed to strengthen the managerial, financial, and digital capabilities of microentrepreneurs by incentivizing actual behavior change that helps them thrive in a competitive and digital world.

Whether on their own or through partnerships with edutech providers, these five key questions can guide financial service providers to support their clients as they transition to digital:
<ol>
 	<li>How can we mitigate the negative impact on clients’ financial health? Providers can give users key information to help them identify their most pressing financial service needs during the immediate crisis and learn what solutions are available to them, such as potential scenarios where restructuring their loan may make sense, the importance to put together a short-term budget for family and business, or ideas for reducing expenses. Support means not only giving information, but making sure clients understand and know exactly what they need to do first.</li>
 	<li>How can we enable and empower clients to be digital citizens? Building a digital foundation must go beyond a promotional campaign for digital products. FSPs must be intentional about building the awareness, knowledge, and confidence of their microbusiness customers so they have all they need to interact responsibly in the digital world. This should not only to help them access financial services like digital lending and online payments, but also to show them how these tools benefit their businesses. Depending on the user, basic information such as navigating web browsers, search engines, or downloading a mobile app may be necessary. Training on managing email, social networks, and maintaining data privacy is also critical.</li>
 	<li>How can we accelerate the learning, adoption, and usage curve of digital tools? The best teachable moment is when customers identify how a solution can improve their businesses, and therefore improve their income and family wellbeing. Once microbusinesses are comfortable with basic digital tools, many will require more advanced training on how to leverage digital promotions and sales, the benefits and costs of different payment platforms, and a better understanding of logistics and product distribution options Business needs and goals are good motivators to drive clients to adopt new tools.</li>
 	<li>How can we support clients to still thrive and project themselves and their businesses? Microbusinesses need resilience and motivation to re-envision their futures. It may seem unwieldy to provide the personal support clients need right now, but it is worth the effort, not only because of the value added to society in general but for future loyalty and positioning returns. Simple initiatives like sharing examples of how other MSMEs have successfully shifted gears, and pointing them to relevant sources of information in their market, can make them feel supported and help them to navigate today’s uncertainty. In the middle of a crisis, it might be difficult for some entrepreneurs to think creatively and therefore providing them with information on how to identify new market opportunities, including observing unmet demands for products or services within their communities can be a way to bring hope and motivation again.</li>
 	<li>How can we seize the moment to help customers to change their financial behaviors for good? When entrepreneurs reflect on what could have made the current situation easier to navigate, they can use that information to be more prepared for other crises. For example, acknowledging how an emergency fund would have reduced the stress of uncertain income might set the ground for a behavior change around savings in the future. FSPs can help clients to be more resilient by providing education and tools to build emergency savings for potential crises and learn techniques for goal setting and investing in their future. These strategies might resonate more now and lead to the adoption of more financially healthy practices.</li>
</ol>
The odds are against small businesses during this crisis: research in the U.S. indicates that <a href="https://www.govtech.com/em/preparedness/Small-Businesses-Are-a-Vital-Part-of-Community-Resiliency-but-Often-Overlook-Vulnerabilities.html" target="_blank" rel="noopener noreferrer">40 percent of small businesses never reopen after a disaster</a>, and 25 percent of those that do reopen fail within a year. To help these businesses survive, they need access to digital tools and support to build the capabilities needed to use these tools effectively. Financial service providers must step up to help entrepreneurs and ensure that they have the tools that they need to be part of the new digital world and seize opportunities to thrive and prosper.

Accion works with large and small FSPs to help build customers’ financial, business, and digital capabilities by incentivizing behavior change. If your company is experiencing challenges related to COVID-19 and building customers’ digital capabilities and you need personalized support from our team of experienced advisors, please <a href="mailto:GLASSupport@accion.org">contact us</a> to determine how we can support you.

Microbusinesses need help to cross the digital divide

Introduction

As we enter a new decade marked by a global crisis, our mission to reach underserved people and small businesses is more important than ever. We are working to ensure that more people can safely save money, build a business, or protect themselves in the event of a financial shock or emergency.
Accion works to empower people, small businesses, and communities who often lack the tools they need to access new opportunities and succeed. We find, fund, and grow companies creating new ways to meet the financial needs of the underserved—even as reaching these populations becomes more difficult and more urgent. We protect clients and encourage the industry to do the same. We work with partners around the world who believe in the importance of creating a financially inclusive world.

From the CEO and Board Chair

Dear Friends,
The world’s working poor are uniquely vulnerable to the COVID-19 pandemic. Typically, they live day-to-day, earning barely enough money to buy food for their families. They lack a safe place to save, or the means to protect themselves from financial ruin brought by a sudden illness or emergency. The pandemic has spurred real hardship and growing unease about the future.
The decades of progress we have made in reducing global poverty and expanding financial inclusion are at great risk. Accion’s work is more urgent and important than ever.
<blockquote>To protect the progress we’ve made, we must help people adapt to unprecedented challenges.</blockquote>
By building a financially inclusive world, we open doors to safety and opportunity for the three billion people who are left out of or poorly served by the global financial system. Basic financial services like credit, savings, and insurance are critical to helping the underserved cope with the harsh effects of the pandemic on the economy, businesses, and families. Accion is helping financial service providers expand access to these services and weather severe economic challenges by making investments, offering advice, and influencing the industry at large. In turn, we help microenterprises around the world continue to operate and sustain local economies.
Digital technology is key to advance this mission, especially as lockdowns and social distancing may continue for some time. Leveraging our many years of expertise, Accion is working to accelerate digital transformation among businesses and financial service providers and help them stay connected to their clients.
To protect the progress we’ve made, we must help our clients and their financial service providers adapt to unprecedented challenges. We are proud of how Accion has risen to this challenge, and we appreciate all your support that makes our work possible. Thank you.
Best,
<img src="http://accion-staging.flywheelsites.com/wp-content/uploads/2018/10/MES.png" /> <img src="http://accion-staging.flywheelsites.com/wp-content/uploads/2018/10/Diana.png" />
<img class="alignnone wp-image-19083 size-medium" src="http://content.accion.org/wp-content/uploads/2019/07/1_objectsBoard@2x-e1562793604796-300x215.png" alt="" width="300" height="215" srcset="https://content.accion.org/wp-content/uploads/2019/07/1_objectsBoard@2x-e1562793604796-300x215.png 300w, https://content.accion.org/wp-content/uploads/2019/07/1_objectsBoard@2x-e1562793604796.png 621w" sizes="(max-width: 300px) 100vw, 300px" />
Michael Schlein and Diana Taylor

Global impact

Confronting a global crisis

As 2019 came to an end, the outbreak of COVID-19 was just beginning. The pandemic has taken a devastating toll on the lives and livelihoods of low-income people and small businesses around the world. These populations are uniquely vulnerable—often relying on daily in-person interactions to get paid or buy food for their families, which often can’t happen during lockdowns. They often lack a safe place to save money or the means to protect themselves from financial ruin brought by a sudden illness. Small businesses around the world also face a potentially prolonged economic downturn with limited access to financing.

As the crisis unfolded, Accion immediately focused on supporting the resilience of our partners and the resilience of their clients. We leveraged our global insight and experience with digital transformation to help our partners safely maintain operations and aided their responses to ensure the safety of their staff, clients, and communities. We aggregated resources and shared lessons to help partners around the world prepare for unique and evolving challenges. We continue to explore connecting our partners with emergency funding and support as they face short- and long-term challenges related to the crisis.
Accion’s work to build inclusive, resilient communities through access to quality financial services is more critical than ever. Ultimately, we seek to transform this monumental test into an opportunity to build resilience against any challenges that may arise in the future.

In 2019, Accion connected people and businesses with the financial tools they need to manage their daily lives in difficult times and prepare for the future. In an era of economic disruption and uncertainty, these tools are critical to helping the underserved build resilience against emergencies and financial shocks.
<ul>
<li>Advise: We provided strategic guidance and technical assistance for financial service providers and fintechs reaching underserved and vulnerable populations. We offered specialized oversight through board governance.</li>
<li>Invest: Accion’s support helped companies test new models and create new ways to meet the financial needs of the underserved, even as reaching these populations became more difficult—and more urgent.</li>
<li>Influence: Our research and insights pushed the industry to better serve, protect, and empower clients facing a surge of unprecedented challenges.</li>
</ul>
By combining these elements, Accion supported underserved families and businesses facing unprecedented challenges—as well as the financial service providers striving to help them. Accion’s Global Advisory Solutions team helped its partners quickly leverage new technologies to overcome challenges, ensure quality services, and lower the cost of providing financial services at scale, helping more people benefit from the security offered by the formal financial sector. Seven partners around the world have now joined our ongoing project with the Mastercard Center for Inclusive Growth, which seeks to drive the digital transformation of millions of microbusinesses and the financial institutions that serve them.
Accion Global Investments supported inclusive, well-managed, and scalable organizations around the world amid widespread uncertainty and shifting business conditions. This team helped inclusive financial service providers around the world, like Dvara KGFS in India, strive to reach and cater to underserved populations. With 276 branches and more than 1 million enrolled customers, Dvara has brought financial services to rural clients across Chhattisgarh, Jharkhand, Karnataka, Odisha, Tamil Nadu, and Uttarakhand. Dvara also secured a new round of funding in 2019 that will enable it to pursue expansion into new places, strengthen its presence in existing places, and enhance its digital architecture to provide more customer-centric services in rural India.
Accion Venture Lab continued investing in and supporting innovative fintech startups that improve access, quality, and affordability of financial services for the underserved. Venture Lab added $33 million to its initial capital pool with the launch of a new $23M fund and an additional, separate $10M investment from Accion. The new fund brings together a group of third-party impact and commercial investors that share Venture Lab’s commitment to innovative fintech startups that leverage technology to increase the reach, quality, and affordability of financial services for the underserved at scale.
Accion continues to leverage a strategic partnership with Quona Capital, a venture capital firm that invests in growth-stage fintech companies in emerging markets, to develop the financial inclusion ecosystem around the world. For example, with support from Venture Lab and Quona, Konfio has become a leading small business lender in Mexico by using alternative data to better understand applicant behavior. Konfio started by offering unsecured loans to small businesses and now a offers a credit card, financial education, and insurance products to underserved clients.
Each Accion team continued pursuing opportunities with the greatest potential to create a financially inclusive world:

The Center for Financial Inclusion

The challenges facing financial inclusion due to the COVID-19 pandemic are unprecedented. With the new leadership of Managing Director Mayada El-Zoghbi, the Center for Financial Inclusion (CFI), an independent think tank at Accion, continues to produce data-driven insights that support the decision-making of key stakeholders in the inclusive finance sector. In 2019, CFI produced research, advocated for clients, and collaborated with stakeholders to help vulnerable households, businesses, and financial service providers recover from the crisis and build resilience. The foundations laid in 2019 enabled CFI to rapidly respond to the emerging COVID-19 pandemic both within its own research agenda and as a convening organization for the sector.

Client stories

<div id="attachment_21506" style="width: 685px" class="wp-caption alignnone"><img aria-describedby="caption-attachment-21506" class="wp-image-21506" src="http://content.accion.org/wp-content/uploads/2020/06/client-story-annual-report.jpg" alt="" width="675" height="450" srcset="https://content.accion.org/wp-content/uploads/2020/06/client-story-annual-report.jpg 1024w, https://content.accion.org/wp-content/uploads/2020/06/client-story-annual-report-300x200.jpg 300w, https://content.accion.org/wp-content/uploads/2020/06/client-story-annual-report-768x512.jpg 768w" sizes="(max-width: 675px) 100vw, 675px" />Gregoria Chile | La Paz, Bolivia | BancoSol client</div>
Financing from BancoSol helped Gregoria Chile grow and sustain her leather goods shop in La Paz, Bolivia. But it also her build a build a better life. “I‌ ‌started‌ ‌to‌ ‌work‌ ‌in‌ ‌the‌ ‌business‌ ‌after‌ ‌high‌ ‌school,” she says. “‌I‌ ‌also‌ ‌went‌ ‌to‌ ‌study,‌ ‌but‌ ‌I‌ ‌saw‌ ‌how‌ ‌much‌ ‌my‌ ‌mother‌ ‌was‌ ‌suffering‌ ‌economically.‌ ‌That‌ ‌was‌ ‌when‌ ‌I‌ ‌dedicated‌ ‌myself‌ ‌more‌ ‌to‌ ‌the‌ ‌business.”
Gregoria runs the business by herself, but her family counts on the income from her leather goods to eat, buy clothes, pay bills, and more. “‌BancoSol‌ ‌has‌ ‌helped‌ ‌contribute‌ ‌to‌ ‌the‌ ‌quality‌ ‌of‌ ‌life‌ ‌of‌ ‌my‌ ‌whole‌ ‌family,” says Gregoria. “‌With‌ ‌the‌ ‌loan‌ ‌that‌ ‌I‌ ‌took‌ ‌out‌ ‌I‌ ‌was‌ ‌able‌ ‌to‌ ‌buy‌ ‌materials‌ ‌and‌ ‌machinery,‌ ‌which‌ ‌enable‌ ‌me‌ ‌to‌ ‌start‌ ‌working.”
<img class="alignnone wp-image-21507" src="http://content.accion.org/wp-content/uploads/2020/06/annual-report-pic-4.png" alt="" width="675" height="453" srcset="https://content.accion.org/wp-content/uploads/2020/06/annual-report-pic-4.png 923w, https://content.accion.org/wp-content/uploads/2020/06/annual-report-pic-4-300x201.png 300w, https://content.accion.org/wp-content/uploads/2020/06/annual-report-pic-4-768x515.png 768w" sizes="(max-width: 675px) 100vw, 675px" />
Before the pandemic, many of BancoSol’s customers like Gregoria preferred to visit branches in person rather than use digital banking services. To bridge the digital divide, BancoSol quickly increased phone-based and social media support for those that need help managing their money digitally. These efforts have proven vital to keeping customers connected to supportive financial services in very uncertain and challenging times.
Gregoria views BancoSol as a friend who supported her when many others would not. “I’m‌ ‌thankful‌ ‌for‌ ‌BancoSol‌ ‌because‌ ‌they‌ ‌trusted‌ ‌me‌ ‌even‌ ‌though‌ ‌they‌ ‌saw‌ ‌that‌ ‌I‌ ‌didn’t‌ ‌have‌ ‌much‌ ‌capital‌ ‌or‌ ‌machinery,” she says. “‌They‌ ‌offered‌ ‌to‌ ‌give‌ ‌me‌ ‌that‌ ‌credit‌ ‌to‌ ‌grow‌ ‌my‌ ‌business.‌ ‌Thank‌ ‌you,‌ ‌BancoSol.”

<div id="attachment_21510" style="width: 685px" class="wp-caption alignnone"><img aria-describedby="caption-attachment-21510" class="wp-image-21510" src="http://content.accion.org/wp-content/uploads/2020/06/laal1.jpg" alt="" width="675" height="446" srcset="https://content.accion.org/wp-content/uploads/2020/06/laal1.jpg 1054w, https://content.accion.org/wp-content/uploads/2020/06/laal1-300x198.jpg 300w, https://content.accion.org/wp-content/uploads/2020/06/laal1-768x508.jpg 768w, https://content.accion.org/wp-content/uploads/2020/06/laal1-1024x677.jpg 1024w" sizes="(max-width: 675px) 100vw, 675px" />Laal Kumari Singh | Raipur, India | Sub-K client</div>
For people like Laal KumariSingh who live and work in rural India, accessing financial services can be a major challenge. Major bank branches are often located far away and getting approved for a loan raises its own hurdles. Rather than asking for people like Laal to travel, Accion partner Sub-K is bringing banking to underserved people through inclusive, digital-enabled financial services.
Sub-K, which means “for everyone” in Hindi, relies on an agent-assisted model that has helped reach millions of underserved people in India. Sub-K operates throughout India in 25 states with more than 100 cobranded branches and 13,000 agents — typically “mom and pop” shops or “kirana” stores. They’ve partnered with 10 banks to serve close to 4 million clients, and currently support 609,000 active borrowers with a portfolio of over $180m.
Sub-K, supported by Accion Global Investments and Accion Global Advisory Solutions, has also joined a partnership between Accion and the Mastercard Center for Inclusive Growth to expand access to the digital economy. Its services are vital for underserved populations to build a financially healthy and resilient future.
The credit provided by Sub-K allowed Laal to grow her cattle rearing business. “Before, I had 5 to 10 cattle, but today I have almost 30 to 40 of them,” she explains. “And the milk productivity surely has gone up. Today I now ship 30 to 40 liters of milk per day. That’s how my productivity has increased.”
Laal’s income helps support a family of five: 2 boys, one girl, and a husband. “Because I have more disposable income, I can contribute more to my children’s education,” she says. She also used income to purchase a shop in a neighboring town in Burundi. “Our family’s life has improved because now we have some kind of financial security.”
Laal plans to rely on Sub-K to expand her business and buy more and more cattle and buffalo. She doesn’t have specific plans for her family in the future, but she says, “whatever I earn, I will use it to help my family.”
<img class="alignnone wp-image-21511" src="http://content.accion.org/wp-content/uploads/2020/06/Laal2.jpg" alt="" width="675" height="438" />

Melissa Villanueva is a visionary small business leader on a mission “to create and empower authentic community spaces through coffee.” As the owner and CEO of Brewpoint Coffee in the suburbs of Chicago, Illinois, Melissa has led her business to success since she founded it with her husband in 2014.
<div id="attachment_21520" style="width: 685px" class="wp-caption alignnone"><img aria-describedby="caption-attachment-21520" class="wp-image-21520" src="http://content.accion.org/wp-content/uploads/2020/06/Melissa-Villanueva_hero.jpg" alt="" width="675" height="450" srcset="https://content.accion.org/wp-content/uploads/2020/06/Melissa-Villanueva_hero.jpg 4000w, https://content.accion.org/wp-content/uploads/2020/06/Melissa-Villanueva_hero-300x200.jpg 300w, https://content.accion.org/wp-content/uploads/2020/06/Melissa-Villanueva_hero-768x512.jpg 768w, https://content.accion.org/wp-content/uploads/2020/06/Melissa-Villanueva_hero-1024x683.jpg 1024w" sizes="(max-width: 675px) 100vw, 675px" />Melissa Villanueva | Chicago | Accion in the U.S. client</div>
Before starting Brewpoint, Melissa was unhappy at her corporate job. So she decided to quit and buy a coffee shop. Melissa explained that she embarked on this new venture “having the mentality that we need to get better every day, learn as we go, and be as engaged as possible.”
Melissa’s leadership has grown Brewpoint to three locations in less than five years. In looking to open the third shop, Melissa found that traditional banks were not able to provide the capital she needed. She came to Accion and received a loan to help remodel the location. Since then, Melissa has become an integral part of Accion’s community in Chicago, participating in Accion’s Neighborhood Entrepreneurship Lab Program and serving as a coach for other entrepreneurs.
Melissa is dedicated to her community in Elmhurst, Illinois and employs dozens of people from the area. As the COVID pandemic took hold in early 2020, her dedication grew even stronger. In addition to setting up a fund to support her employees, Melissa created an initiative that gives gourmet coffee to healthcare workers and also partnered with a local foundation to provide coffeeshop gift cards to local teachers. All of this community engagement came alongside innovative, digitially-enabled changes to Brewpoint’s business model that allowed the company to stay viable during a stay-at-home order.
It’s clear that Melissa’s original mentality has served Brewpoint Coffee well during both its growth and during the COVID crisis: she and her business have improved every day, learned along the way, and been incredibly engaged in her community.

Accion in the U.S.

In the United States, for more than 25 years, Accion has created economic opportunity by supporting small business owners with the capital, networks, and resources they need to grow healthy enterprises and contribute to thriving local economies. We empower women, minority, immigrant, and other under-served small business owners with microloans to help them start or grow their business. Working closely with local and national partners across the country, we also support entrepreneurs with one-on-one business advising, opportunities to grow their network, and digital educational resources to fuel their success.
&nbsp;

In early 2020, Accion’s efforts to help small business owners in the U.S. were bolstered by a strategic organizational combination between the Accion U.S. Network and Opportunity Fund, the country’s largest non-profit small business lender. The new combined organization, Accion Opportunity Fund, plans to spearhead the development of a national microlending strategy to meet the credit needs of small businesses—developing new products, establishing new partnerships, promoting research and financial education, and leveraging digital technologies and data analytics to support mission-driven lending.
In response to the COVID-19 crisis, in early 2020, Accion Opportunity Fund launched a small business relief fund with a goal of raising $50 million to reach the most vulnerable entrepreneurs, especially women, people of color, and immigrants, with loan payment relief, access to affordable capital, and educational resources on a range of business topics to help them navigate challenges during the crisis.
Accion is grateful to its U.S. partners, including the Boston Beer Company, Capital One, the Coca-Cola Foundation, Discover, FedEx, the Fidelity Foundation, Fifth Third Bank, JPMorgan Chase, the W.K. Kellogg Foundation, the Mastercard Center for Inclusive Growth, the MetLife Foundation, the Travelers Foundation, and the Walmart Foundation.

Your support is powerful

With your help, we will work to build a financially inclusive world—where every individual has access to high-quality, affordable financial services to help them weather economic downturns and reach their full potential. <a href="https://give.accion.org/page/contribute/">There are many ways to give.</a>

Accion 2019 financials

Accion’s most recent audited financial statements are available <a href="https://www.accion.org/financials">here</a>.

Board of Directors

You can view Accion’s Board of Directors <a href="https://www.accion.org/about/our-board-of-directors/">here</a>.

In 2019, Accion worked to build a financially inclusive world where everyone can access the tools they need to build better lives. As we enter a new decade marked by a global crisis, our mission is more important than ever.

Report

Cover image: As a farmer, Rose Kilonzo knows that a good harvest isn't a given. With farming advice and insurance from our partner Pula in Kenya, she has been able to optimize her crop yield.

Accion 2019 Annual Report

The Accion family is prepared to help underserved entrepreneurs overcome the challenges of COVID-19.

Perhaps more than ever, U.S. small businesses need our support—especially those owned and operated by entrepreneurs of color and women.

To that end, I’m excited to share that on Saturday June 20, from 4-10 pm EDT efforts to support underserved businesses are getting a major boost through a live virtual concert and fundraiser featuring some great bands, including 2 Chainz, Brandi Carlile, Brittany Howard, Leon Bridges, T-Pain, and more. All proceeds from the concert, “<a href="http://www.smallbiz.live/" target="_blank" rel="noopener noreferrer">Small Business Live</a>,” will go to Accion Opportunity Fund to provide grants to small businesses, with a focus on those run by entrepreneurs of color and women.

Artists will also place small businesses in the spotlight by performing onsite at local establishments and sharing personal stories about what that business means to them and their communities. Please tune in and share these details with anyone interested in viewing or making a donation.

Accion Opportunity Fund, the <a href="https://www.accion.org/opportunity-fund-and-the-accion-u-s-network-combine-efforts-to-drive-small-business-access-to-credit-and-advisory-services-in-the-u-s" target="_blank" rel="noopener noreferrer">newly combined</a> organization that brings together the former Accion U.S. Network and Opportunity Fund, is taking bold steps to address today’s challenges and help underserved entrepreneurs – entrepreneurs of color, low-income entrepreneurs, and women – access the capital and support they need to build thriving businesses. Over the past 30 years, more than 80 percent of Accion's clients in the U.S. have been entrepreneurs of color.

In response to the COVID-19 crisis, in early 2020 the Opportunity Fund launched a small business relief fund with a goal of raising $50 million to reach the most vulnerable entrepreneurs, especially women, people of color, and immigrants, with loan payment relief, access to affordable capital, and educational resources on a range of business topics to help them navigate challenges during the crisis.
<h3>More about Accion’s presence in the U.S.</h3>
Accion was <a href="https://www.accion.org/about/history" target="_blank" rel="noopener noreferrer">founded in 1961</a> to empower low-income people with the knowledge and tools to improve their lives. In the early 1970s, Accion staff in Recife, Brazil, began focusing on informal businesses as a means to achieve this goal. An Accion organization in Recife called UNO coined the term “microenterprise” and began issuing small loans with rates typically reserved for commercial customers. To our knowledge, these were the first loans that launched the field of microcredit.

In 1991, concerned about growing economic inequality in the United States, Accion brought its microlending model home by piloting a program in Brooklyn, New York. Accion aimed to help those who didn’t meet requirements for traditional financing (such as bank loans) because their requested amount was too small or because they had limited or damaged credit.

Accion has since worked to adapt its lending model to the social and economic needs of communities across the United States. We’ve served small businesses nationwide through four independent community development financial institutions (CDFIs) and a national office (the Accion U.S. Network, now part of the Accion Opportunity Fund) that invests in shared knowledge, innovation, and impact to benefit the entire network.

Since 1991, our Accion U.S. partners have provided more than 60,000 loans to enterprising small business owners and disbursed more than $500 million in capital. Additionally, Accion provides business advising and training services — both in person and through online educational resources — to tens of thousands of entrepreneurs each year.

<a href="https://www.accion.org/how-we-work/invest/accion-venture-lab" target="_blank" rel="noopener noreferrer">Accion Venture Lab</a>, Accion’s seed-stage investing initiative, has also helped expand financial inclusion and resilience in the U.S. by supporting innovative fintech companies finding new ways to reach low-income and underserved populations in a sustainable, scalable way. Venture Lab’s portfolio companies in the US have helped Americans with thin or damaged credit files access credit-building loans, connected self-employed workers with business banking accounts, and provided solutions for refinancing consumer debt.

I’m proud of all the work that Accion, our affiliates, and our portfolio partners have done to support struggling families and small businesses in the U.S. We remain committed to building a financially inclusive world and ensuring that low-income and underserved people don’t fall further behind as we recover from the pandemic. I hope you’ll join me in supporting small businesses in the U.S. by tuning in to “<a href="http://www.smallbiz.live/" target="_blank" rel="noopener noreferrer">Small Business Live</a>” on June 20.

How we are helping US small businesses recover, and how you can join

Libby Morley

Our financial service provider and inclusive fintech partners from around the world share how they adjusted to disruptions from COVID-19

Accion’s partners have always used innovative approaches to bring financial inclusion to underserved people and businesses in emerging economies. The coronavirus pandemic has put their spirit of innovation to the test as they must find new ways to continue serving clients while protecting their wellbeing and that of their employees.

We’re sharing examples of adaption from our partners around the globe that we hope will be helpful for all organizations to keep in mind when considering client and staff safety and business continuity during a time of constant changes.
<h3>1. Ensure staff has the equipment and education to do their jobs safely.</h3>
Our partner <a href="https://www.accion.org/this-company-is-making-healthcare-more-accessible-in-emerging-markets" target="_blank" rel="noopener noreferrer">Field Intelligence</a> is a startup operating in Nigeria and Kenya that uses data-driven supply chain management software and highly efficient distribution service to help pharmacies operate more efficiently. Their pharmacy clients remained open throughout the pandemic to provide necessary services in their communities. As a preemptive measure, Field Intelligence completed a handwashing and safety campaign to encourage 150 pharmacies to use safe practices that prevent the spread of the virus. They also supplied and trained all of their delivery staff on proper personal protective equipment usage. By tapping into their existing network, they were able to quickly provide training to their staff. These steps were critical for keeping essential workers safe over the past few months. As many countries begin to reopen and ease restrictions, businesses should prioritize safety above all else and provide the training and equipment that staff and clients need.
<h3>2. Enable staff to provide customer support remotely.</h3>
<a href="http://apolloagriculture.com" target="_blank" rel="noopener noreferrer">Apollo Agriculture</a>, another startup in Kenya, partners with small-scale farmers to help them access everything they need to maximize their profitability, from financing and insurance to farming products and optimized advice. These <a href="https://www.accion.org/this-agricultural-fintech-empowers-the-farmers-who-feed-the-world" target="_blank" rel="noopener noreferrer">farmers are facing great challenges</a> during the pandemic and Apollo empowers them to be productive and sustainable. To continue providing customer support to farmers, Apollo faced a major challenge: transitioning their call center of over 150 people to remote work. Most of their call center agents did not previously have internet or a computer in their home. Despite these challenges, Apollo successfully transitioned the entire team to remote operation and equipped all staff with reliable internet in a matter of days — all during their busiest time of year and the COVID-19 crisis. As remote work may continue for some time, staff need to be fully equipped to work remotely to make these solutions sustainable in the long-term.
<h3>3. Innovate to meet customer's needs digitally.</h3>
In Bolivia, <a href="https://www.accion.org/transforming-finance-low-income-people-bolivia" target="_blank" rel="noopener noreferrer">BancoSol</a> — a regulated commercial bank dedicated to serving micro and small entrepreneurs — knew that their customers needed urgent services to stay afloat during the pandemic and that digital tools would be crucial for reaching them. BancoSol launched a pilot of a remote lending program and is also working on revamping their existing mobile application to serve more clients digitally. Additionally, tellers are encouraging clients to sign up for online banking services and begin using them to minimize face-to-face contact and continue to be able to manage their businesses and connect with customer service representatives. So far, results from BancoSol’s initiative have been encouraging — in the first ten days of their efforts, online transactions increased by five percent, and transactions have continued to rise since then.
<h3>4. Make a plan to keep your team safe and productive in the long-term.</h3>
As China has reopened its economy and more people have returned to work, conversations with our partner <a href="https://www.accion.org/giving-customers-a-reason-to-trust-digital-finance-in-china" target="_blank" rel="noopener noreferrer">Grassland Finance Limited</a> have given us a glimpse into what many of our other partners may experience in the coming weeks and months. Grassland shared with us that their staff is:
<ul>
 	<li>Practicing social distancing in the office. Staff continue to work in shifts and will do so until the situation improves.</li>
 	<li>Wearing protective masks and regularly monitoring for symptoms to ensure those coming into the office are healthy.</li>
 	<li>Avoiding in-person team activities and unnecessary travel.</li>
</ul>
For Grassland and other partners, the need to increase digital capacity to adapt to immediate challenges and to move into a new normal is a key theme. Seah Hooi Koon, Grassland’s COO, shared, “The disaster also showed again the importance of building up the digital capability of both our company and of our clients, and this will be key in our strategy going forward.”

Digital capability, adaptability, and a spirit of innovation will continue to guide companies forward as the situation evolves around the globe. At Accion, we will continue to stay in close contact with our partners to learn from them as they adapt and to provide resources to help them increase digital capabilities, keep staff safe, and continue to serve their clients.

Four examples show how businesses can stay safe and effective right now

Kathleen Yaworsky

Leading organizations must wield data and analytics to move their businesses online

Digital transformation — the use of digital technology to help businesses work better — has been top-of-mind for many financial service providers (FSPs) over the past several years, and now the COVID-19 pandemic has added new urgency. Many even equate digital transformation with survival in a <a href="/covid19">post COVID-19 world</a>. Despite the need to bring businesses online as soon as possible, digital transformation cannot occur overnight. It requires a holistic approach that supersedes any one product, business function, or initiative. When done well, it transforms an organization to be more insight-driven, agile, and efficient.

Data capabilities play an essential role in an organization’s digital transformation. Data can inform optimization strategies that increase efficiency and revenue. Data itself can also be monetized creating entirely new business models where data assets become products. Especially today, when FSPs must make unprecedented and rapid decisions, adjust business strategies, segment customers to understand portfolio risks, rethink credit models, and enable remote engagement with customers and staff. Unfortunately, the <a href="/are-you-unleashing-the-full-potential-of-your-data">data foundations</a> of financial providers are rarely robust enough to enable them to quickly adopt a digital business model.

To support FSPs as they work to build their data capabilities, Accion has developed a <a href="https://dtsurveydev.accion.org/data-maturity" target="_blank" rel="noopener noreferrer">Data Maturity Framework</a> to provide a clear and consistent tool for organizations to assess their current maturity, set benchmarks, and plan a roadmap of strategic data initiatives that support digital transformation and priority business goals. The Data Maturity Diagnostic was designed to supplement the Digital Transformation Framework by evaluating the data capabilities required to advance to each Digital Transformation Maturity Stage. The Data Maturity Diagnostic can also be used as a standalone tool to assess the data capabilities needed to achieve other goals, such as:
<ol>
 	<li>Determining the status of the organization along the data maturity continuum. By looking at the status of specific parts of your business, you can identify areas for improvement and assess where most progress has already been made.</li>
 	<li>Setting your data strategy — a plan for how you will use data to achieve your priority business objectives — and defining specific maturity targets for each area. These targets will be relevant to your market, customers, budget, and organization capabilities.</li>
 	<li>Benchmarking against peers. Comparing the state of your data capabilities to your peers can be valuable for your investors and donors.</li>
 	<li>Defining and prioritizing your organization’s many strategic data initiatives.</li>
 	<li>Articulating to your staff how strategic data initiatives support your digital transformation vision, provide context, and measure progress.</li>
</ol>
[caption id="attachment_21325" align="alignnone" width="704"]<img class="wp-image-21325 " src="http://content.accion.org/wp-content/uploads/2020/06/data-maturity-diagnostic-results-1024x576.jpg" alt="Accion's Data Maturity Diagnostic " width="704" height="396" /> Data Maturity Diagnostic results help financial service providers assess their data capabilities and identify areas of improvement.[/caption]

Any digital customer experience requires quality, curated data that is readily consumable as close to real-time as possible. For example, let’s consider a digital marketplace lender. In order to acquire, underwrite, disburse, and service loans remotely, multiple systems need to integrate and work together to provide a seamless customer experience — both on the front-end for customers to get what they need, and on the back-end for staff to do their jobs. This requires capacity and integration across the entire data value chain: from identifying the right strategy, to giving the right people access to the data they need in an easy-to-use format, to developing and operationalizing models and algorithms that solve priority business problems, all while adhering to the highest standards of responsible data governance.

At Accion, we’re using our Data Maturity Framework in all these ways and more to understand, map, and accelerate the building of digital capabilities so we can enable the transformation journeys of <a href="/helping-small-businesses-and-communities-thrive-with-digital-financial-services">our partner FSPs</a> and their customers. To be truly customer-centric, assist their customers in their recovery, and <a href="https://www.accion.org/data-is-crucial-for-driving-inclusive-growth">drive inclusive growth</a>, institutions must become data-centric first. Learn more about our <a href="https://dtsurveydev.accion.org/data-maturity">Digital Maturity Framework here</a>.

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