We may project what could be going on referring to current trend. • In 2017 the micro finance sector shall face the following challenges:
UNDERCAPITALISATION (the capital base is currently inadequate),
DIGITALISATION (sustainable, transparent and affordable service),
MANAGEMENT (review and revision decision making process).
- Emerging topics: Facing peer competitors, Negotiating with digital providers, Review style of management, Expand business, Launch a new product, Check market’s position and within the institutional & organisational country framework.
For MFI innovation isn’t an option, but a need.
2016 has been the year of handing over the baton from Millennium Development Goal (MDG 2000-2015) to Sustainable Development Goals (SDGs 2016-2030). Let us say that we aren’t sure that the old racers – micro lenders, micro financiers – have assimilated the new economic development’s rules of the game and have taken into account the power of the new racers who aggressively entered into the lane: the technologists.
Besides, new racers are warming up for competing in the arena of development finance: e-money issuer, financial cooperative, nonbank deposit-taking institution, nonbank financial institution, non-financial firm, crowd funders and all those in the category of the alternative finance.This is the official list of the competitors, which has been released by Basel III Committee beginning this year ( http://www.bis.org)along with the guidelines for countries’ supervisors for a fair competition; actually the GVTs have been invited to make available an enabling environment, which should be in line with the UN Agenda for SDGs (http://www.un.org/ga/search/view_doc.asp?symbol=A/RES/70/1&Lang=E).
Among the other sponsors who have collaborated for fair games,there are: WB-CGAP (http://www.cgap.org/publications/new-funder-guidelines-market-systems-approach-financial-inclusion,FSD Africa (http://www.fsdafrica.org) and others.
We have elaborated on the matter and worked out a Logical Framework, which can be a reference for ground work at both macro and micro interventions. The former to deal with a country institutional and organizational framework and the latter to cope with management of financial inclusion at individual grass root organizations; see: Five Questions about Financial Inclusion: http://www.emergingmarketsesg.net/esg/2016/08/26/five-questions-about-financial-inclusion-special-interview-with-dr-ascanio-graziosi-rome-italy-august-26-2016/.
Continua a leggere “From MDGs to SDGs: the risks of new legends and myths”
Suggestions to step in micro finance market https://www.linkedin.com/pulse/open-letter-fintech-ascanio-graziosi?trk=prof-post
Nowadays FinTech people are living great moments also for the market perspectives, having some $ 3,7 trillion opportunities (https://cfi-blog.org/2016/10/17/digital-financial-inclusion-seizing-a-3-7-trillion-opportunity/ ). We congratulate Technologists for the achievements and add a word of caution, being among the digitalization’s supporters we follow the ongoing movement. ……
……….. A CONCRETE PROPOSAL. Continuing our reasoning and taking the segment (a), we don’t say that money transfers and remittances should be free of charge; we do say that the service should be sustainable for the provider, accessible for the potential client and affordable for the user. Technologists and Financiers should find out the way to not overcharge the transfer of small amount of money presumably made by people working away from their own places and sending money to those who are in need. If we don’t find out modalities to minimize the commission, we will penalize the poor and mislead the purpose of financial inclusion. This is a technical matter that may be overcome elaborating on the statistical data; it may be assumed, for example, a cheap commission for small amount or linking it to the frequency of the transactions in a given period.
Dr. Ascanio Graziosi, Owner, FINANCIAL AND ECONOMIC INCLUSION