Archive for the ‘India’ Category

Why the Mobile Phone Might Not Be as Inclusive as You Think

January 8, 2013

Originally posted at Next Billion. Leo Tobias is a Technology Program Manager at Grameen Foundation.

Mobile Phone TransactionFinancial inclusiveness is a core tenet of our work at Grameen Foundation. Utilizing mobile phones for financial services has gained a lot of traction as a sustainable and scalable solution to serve the 2.5 billion people who do not have access to formal banking services. But does this solution really enable us to reach all of these people?

As part of a pilot program to implement mobile money at one of our partner organizations, a survey was conducted to gather basic knowledge about people’s access to mobile phones and their usage of mobile money and other financial services. While 98 percent of members interviewed have access to a mobile phone, only 78 percent owned their own mobile phones.

So what’s the problem? A previous study conducted by Grameen Foundation at Cashpor, a microfinance institution (MFI) in India, revealed there are significant access, convenience and security issues associated with customers not having their own handset or the knowledge to operate the technology themselves…

To read this full post, visit Next Billion.

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Three Stories (and Lessons) about Saving through the Mobile Phone

November 20, 2012

Julia Arnold is a Program Associate for Grameen Foundation’s Microsavings initiative. If you have any questions for Julia about her time in India with the members of Cashpor, she will answer them here in the comments section.

In July, on behalf of Grameen Foundation’s Microsavings initiative, I went to Cashpor Microcredit in Varanasi, India, to conduct research on mobile phone use among its savings and credit clients.  The microfinance institution (MFI) began offering savings services via mobile phones in July 2011, providing a vital financial service to its clients to which they would not otherwise have access.  Building assets through a safe, reliable savings account helps the poor plan for the future and mitigate the risk of small, unreliable incomes.

Though we understood that a majority of Cashpor clients had some access to a mobile phone before the MFI began offering the savings services, there is global evidence that poor women have limited access to and literacy with mobile devices.  We wanted to know if the mobile phone requirement in Cashpor’s program limited the ability of its clients, all of whom are female, to access the savings services. (more…)

Day Ten: Save, Hope, Live and Love

November 20, 2012

For the 12 days leading up to Thanksgiving in the U.S., we’re featuring 12 stories from six different countries we work in, as a way of saying, “Thank You” to our supporters, who make our work possible. We hope that you enjoy seeing the difference that you’re making in the lives of poor people around the world, every day.

Santosh Daniel, of Mumbai, India joined Grameen Foundation February 2010 as a Project Manager leading oure microsavings initiative. Prior to joining Grameen, Santosh had sixteen years of experience with ICICI bank, Kotak Mahindra Bank and ACCION, specializing in lending to urban poor.

I wanted to work for Grameen Foundation to help lend credibility to this microfinance model being used successfully to reach the poor – to learn and overcome the immense challenges. It’s creative work, and it’s a very uplifting feeling to witness the impact of our actions reflected through the smiles the clients we serve. I enjoy being a part of a very active and vibrant organization in which is defining and influencing the international development landscape in India.

Santosh regularly meets with savings groups in the villages, helping connect poor women to savings accounts through a mobile phone.

Grameen Foundation supports Cashpor, a microsavings program in partnership with ICICI Bank, to use mobile phones to enable poor, isolated customers to withdraw and deposit their money without having to travel to a bank. We operate in seven districts in Utter Pradesh, with about 80,000 clients. Until now, these women didn’t have access to a bank account, because they live in villages where there are no bank branches. Furthermore, they don’t make enough money to open conventional accounts, which require minimum balances and deposit/withdrawal amounts.

In the past, if these women had some extra money, they would keep it around the house or bury it. Otherwise, it would be spent on non-essential and impulse purchases, or taken by their children, or even eaten by rats. They didn’t have any options for an organized way of saving money. This account allows them to make very small deposits – even deposits of 20 rupees (about $0.40) are allowed – from their mobile phones, which are available for less than $10 in India. Most of the women are illiterate, so they are assisted by the center manager, who also collects and distributes the money at the end of the weekly meeting.

Work requires me to be in the field much of the time, visiting savings groups meetings about six times a month. The most challenging part of the job is patiently working with different stakeholders with divergent interests towards a common goal. Not all the factors influencing the project are controllable, but how close we can come to understanding and responding to the uncontrollable effectively defines our success.

With our technology and information-collecting expertise, we’re helping take this mobile-enabled savings to the rural villages where these women can enroll themselves through the mobile phone and start saving. Many of them are illiterate, so we also teach them financial literacy to help them understand the text messages. We are also getting them in the habit of saving money, which allows them to make a plan. Our initiative has brought them closer to their dreams of being able to save, hope, live and love.

Help even more poor women reach their dreams through access to savings accounts and other services by supporting Grameen Foundation today.

Our 12 days of Thanksgiving series stories were collected and edited with the help of Bankers without Borders® volunteer Nicole Neroulias Gupte.

You can read the rest of our series here: Part 1 | Part 2 | Part 3 | Part 4 | Part 5| Part 6| Part 7 | Part 8 | Part 9 | Part 10 | Part 11 | Part 12

Day Nine: A Savings Account to the Rescue

November 19, 2012

For the 12 days leading up to Thanksgiving in the U.S., we’re featuring 12 stories from six different countries we work in, as a way of saying, “Thank You” to our supporters, who make our work possible. We hope that you enjoy seeing the difference that you’re making in the lives of poor people around the world, every day.

Rajkumari Buddhu lives in Kaurouta, a village in Uttar Pradesh, in northern India. She shares a small mud-thatched hut with her husband, four children, two daughters-in-law and grandchildren. The family’s livelihood comes from weaving clothes and selling them at the local market, Rajkumari spins her wheel and makes small spindles of different-sized threads from larger spindles, forming the spools used in the weaving process. Here is her story, as told to local Grameen Foundation staff.

Rajkumari has always wanted an organized way to save the small amount of money that, though discipline, she had left over every week, but without access to a savings facility, she often spent it. When Grameen Foundation microfinance partner Cashpor introduced a savings program in her area in July 2011, Rajkumari quickly enrolled. Now she has a disciplined and reliable way of saving.

Rajkumari (shown here with her grandson) earns a living weaving thread, and has been able to help herself – and her family – in times of emergency, thanks to her savings account provided by Cashpor, helped by Grameen Foundation.

Just in the past year, she recalls tearfully, there have been three separate occasions that have made her feel grateful for Cashpor and Grameen Foundation:

  1. Rajkumari became sick with severe pneumonia and had to stay in the hospital. After the first few days of treatment, paid for by her husband and sons, the hospital insisted on an additional 4,000 rupees (about $75). Her family’s resources had totally dried up, but she realized that she had some money left in her Cashpor savings account. With the IV still attached to her wrist, she traveled on her son’s bicycle to the nearest Cashpor branch. It was almost 6 p.m., but to her great relief, she saw the center manager’s motorcycle still parked outside. She immediately went over to him and withdrew the entire 3,200 rupees in her account, then managed to borrow the balance from her neighbor and pay the hospital to continue her treatment.
  2. Rajkumari’s daughter-in-law, during the third trimester of her pregnancy, realized that her baby had stopped moving. She was rushed to the hospital and told that she needed an operation to save the baby and herself. Rajkumari’s family was not prepared for this sudden expense, but the money in her savings account again came to the rescue. After seeing the birth of her healthy granddaughter, Rajkumari felt proud that her small savings account helped save the lives of her daughter-in-law and her granddaughter.
  3. A less dramatic, but still meaningful, occasion happened when her twin daughters wanted to participate in the state-level Khabaddi athletic championship in Delhi, but they needed money to fund the trip. Rajkumari managed to help them with her small savings, and she now proudly displays the trophy and the certificate that her children won in the championship.

Though the Hindi meaning of her name is “princess,” life has never treated Rajkumari as one. Now, with the help of Grameen Foundation and Cashpor’s savings program, she is the queen of the house – managing household finances, helping with the family business and helping the family lift themselves out of poverty. Access to savings has helped usher in new hope to face the hardship and give wings to her aspirations.

You can help more families like Rajkumari’s lift themselves out of poverty when you support Grameen Foundation today.

Our 12 days of Thanksgiving series stories were collected and edited with the help of Bankers without Borders® volunteer Nicole Neroulias Gupte.

You can read the rest of our series here: Part 1 | Part 2 | Part 3 | Part 4 | Part 5| Part 6| Part 7 | Part 8 | Part 9 | Part 10 | Part 11 | Part 12

Three Key Lessons about Gender and Mobile Finance

November 7, 2012

The mobile phone is gaining widespread popularity as a means to bridge the “last mile” – a way of bringing information and financial services to hard-to-reach people who don’t have ready access to them.  To get a better picture of how to best deliver mobile services, we conducted a case study with our partner, Cashpor Microcredit, a microfinance institution based in Varanasi, India.

There are 300 million fewer women than men who own mobile phones in developing countries, and high barriers to entry remain for women. This study investigates some of these concerns, specifically whether women have limited access to savings services delivered via the mobile phone.

It finds that, though enthusiasm for the mobile phone as a way to deliver these services is justified, there is evidence that poor women have limited access to and lack literacy with mobile devices, creating a gap in their access to financial and other services delivered this way.

You can download the full report here, but we’ll share with you here the three key lessons:

1. Promoting mobile phone ownership among women is critical to ensure their access to services.

Women who own phones make more frequent savings deposits than women who borrow a phone. In addition, half of the women who borrow a phone reported that there are times when their access is limited, due chiefly to the primary user taking it with him for work during the day. These women’s ability to make a deposit depends on whether the phone is available to them during their weekly Cashpor meeting. Women who do not have access to a phone cannot save with Cashpor, which effectively excludes them from access to a safe and reliable place to save their own and their family’s money.

2. Providing mobile phone literacy training is essential among these women.

Of the 65 women we spoke with, only 23 were able to use the phone independently; of those women, 13 own a phone. The women who cannot use a phone independently reported asking their husbands, sons, daughters and neighbors for help to answer, hang up or dial the phone. Mobile phone literacy training would 1) ensure that women are empowered and feel a sense of ownership over the product; 2) demystify the mobile phone; and 3) enable knowledge transfer to children and grandchildren, ensuring that they are also able to take advantage of mobile phone-delivered financial services in the future.

3. The children of Cashpor clients know much more about mobile phones than their parents.

Women reported that their children – both boys and girls – knew how to use mobile phones and reported asking their children how to use a feature on the phone, typically how to make a call. Interestingly, only a few women reported that their children have classes in school with computers or cell phones. Most children are teaching themselves how to use the phone and are passing that knowledge along to their mothers.

Download the full report

“Financial Vandalism” in India, and a Way Forward

August 15, 2012

Alex Counts is president, CEO and founder of Grameen Foundation, and author of several books, including Small Loans, Big Dreams: How Nobel Prize Winner Muhammad Yunus and Microfinance are Changing the World.

I was invited to give one of the closing keynote addresses to the Sa-Dhan conference, something I had been preparing for at least since I travelled to India in early July to work on an upcoming book about the latest trends in microfinance.  I had intended to arrive in time for the inaugural session on August 7, but travel delays prevented that.  (Word to the wise: when travelling to India on the non-stop flights from Newark, plan to arrive in Newark long before your onward flight is due to depart.)

Upon arrival, I was told that the conference’s mood on the first day alternated between “somber” and “angry.”  Just a few days earlier, the Reserve Bank of India (RBI) had announced new regulations affecting microfinance.  Though these policies rolled back some harmful policies announced a few months back and helpfully clarified others, they also introduced a controversial new rule saying that microfinance institutions over a certain size would be subject to smaller margins than they were currently allowed between the rates they borrowed and lent at.  The whipsaw nature of Indian microfinance policy at the national level, coming on the heels of the debilitating and draconian law passed in the state of Andhra Pradesh in late 2010, had justifiably enraged many of the practitioners in attendance – particularly as there had been no warning or explanation for many of the policies announced over the last 12 months.

Grameen Foundation President and CEO Alex Counts (lefts) speaks about the Indian microfinance sector at the Sa-Dhan Conference held earlier this month in that country. With him on stage are Jayshree Vyas (center), Managing Director of SEWA Bank, who served as the moderator, and Sujata Lamba of the World Bank.

Grameen Foundation President and CEO Alex Counts (left) speaks about the Indian microfinance sector at the Sa-Dhan Conference held earlier this month in that country. With him on stage are Jayshree Vyas (center), Managing Director of SEWA Bank, who served as the moderator, and Sujata Lamba of the World Bank.

The second day did not get off to a good start.  Sa-Dhan executive director Mathew Titus announced that a senior government official had canceled his opening address.  However, as the day got going, the overall mood improved.  Royston Braganza, CEO of Grameen Capital India, organized and moderated an excellent panel on “Overcoming the Barriers to Resource Flows” to the sector.  (Grameen Capital India is a joint venture between Grameen Foundation and affiliates of two major banks operating in India.)

I attended Royston’s panel and then caught the end of a concurrent panel on “business correspondent” (BC) models for MFIs working in partnership with, and essentially as agents of, fully licensed banks.  Though some recent policies about the BC model have cast doubt on the viability of MFIs being able to work effectively with banks, it was an invigorating discussion.  Mukul Jaisal, Managing Director of Indian microfinance institution (MFI) Cashpor, talked about his experience pioneering this model for providing savings services (which the MFI has been able to implement with support from Grameen Foundation).


The India Microfinance Crisis, Reconsidered

August 1, 2012

Alex Counts is President and CEO of Grameen Foundation. He recently wrote this  post on his own blog. We have included an excerpt below, followed by a link to the full post. 

I have already written about my impressions of Bangladesh, so let me turn now to India. Much has been written about the microfinance crisis there. For my part, I have made public statements about it, transcribed and released of my debate with SKS founder Vikram Akula at the Asia Society (which took place at the outset of the crisis), and addressed the issue in the opening section of my chapter in New Pathways out of Poverty (the Spanish and French versions of which are freely available, as they are not protected by copyright). David Roodman gave an impressive account of the crisis in his book Due Diligencewhich I have reviewed (a review to which Roodman thoughtfully responded).

However, when I went to India I tried to free myself from preconceptions, and attempted to listen and observe with an open mind. I met with leaders of MFIs large and small, as well as other members of the ecosystem including consulting firms, industry associations, and the staff of Grameen Foundation’s wholly owned subsidiary Grameen Foundation India and our joint venture Grameen Capital India (both of which are organized as social businesses as per Professor Muhammad Yunus’ definition). Below is a list of eight things I learned that I did not know, or believe, before I arrived:

  1. Despite recent progress in terms of returning the sector to normalcy outside AP, and in advancing legislation that is flawed but still a net positive, I heard from multiple sources that that state government of Tamil Nadu is considering an AP-type of ordinance that would throw the Indian microfinance sector into a new and probably much deeper crisis. Stay tuned!
  2. At the height of the frenzied growth during the period 2007-10, many MFI field officers came to rely on so-called “agents” (also known as “ringleaders”) at the village level who took on many of the functions of staff. In effect, field staff were outsourcing their client recruitment and loan underwriting responsibilities. This was a ticking time bomb, as the MFIs effectively lost control of their own activities, most importantly in terms of their relationships with loan clients. The reasons for this probably include the lack of training given to the new recruits of fast-growing MFIs, and the impossibility of managing as many clients as staff were expected to serve (based on unrealistic targets that were the basis for awarding generous bonuses) using the traditional approach. It is not clear that MFI leaders were aware that this was going on, or whether they just turned a blind eye.
  3. I was aware that most of the smaller AP MFIs who do not have operations outside the state have effectively gone bankrupt. What I learned from sitting down with four leaders of these now defunct institutions – who predictably though plausibly claim to have been largely innocent of the abuses committed by the larger MFIs based in the state – is that two AP MFI promoters (i.e., founders) who were distraught by their life’s work being ruined have recently committed suicide, and more are feared.

Read the full post >>

A Productive Week in Asia

June 21, 2012

Shannon Maynard is Director of Bankers without Borders®, Grameen Foundation’s skilled-volunteer initiative. Maynard has more than 15 years of experience in nonprofit management and volunteer mobilization. Before joining Grameen Foundation, she served as Executive Director of the President’s Council on Service and Civic Participation, and managed strategic initiatives for the Corporation for National and Community Service, a federal agency. This post is the second in a four-part series; you can read her first post here.

While in Hong Kong, I start my days with the “international breakfast buffet.”  In my travels, I have actually grown fond of this tourist and business traveler’s treat. I can have a hybrid breakfast of dal and danish in Bangalore, pad thai and pancakes in Bangkok, or dim sum and doughnuts in Hong Kong.

The international breakfast buffet is particularly appropriate in Hong Kong, a truly international city to which everyone’s path seems to have spanned several global cities. As I begin the next leg of my travels, I leave Hong Kong reflecting on the many social-change agents I met. Just as my hybrid breakfast blends the best of multiple food traditions, these folks blur the lines between the social sector and corporate sector when it comes to fighting global poverty.

On Monday, I spent the day with the dynamic women of Grameen Foundation’s Hong Kong office – Sonia, Christina, Dilys and Sharada. Their careers have zig-zagged from banks and consulting firms to social enterprises and Grameen Foundation. They are all equally effective in their roles – which largely focus on cultivating corporate partnerships and donors for our work in Asia – because they know how to make Grameen Foundation’s work accessible to different audiences. They take the time to explain microfinance, social enterprise and other terms that we take for granted, and can do this easily because they truly understand how we are trying to improve the lives of the poor and poorest.

Shannon Maynard (left) meets with Grameen Foundation staff in Hong Kong.

Shannon Maynard (left) meets with Grameen Foundation staff in Hong Kong.

On Tuesday, I had the chance to kick off the Bank of America Merrill Lynch(BAML) CSR Lunch and Learn series.  I impressed by the sheer turnout (including a waiting list for the event!) as well as by the diversity in the room. Some of the most senior people in the Hong Kong office attended the event and were the first to inquire during Q&A about how their teams could get more involved with Bankers without Borders. I have no doubt we will find a way to put their commitment and skills to work in the near future. Melissa Moi, who recently left a prominent post with a well-known NGO in Hong Kong to join BAML’s Corporate Philanthropy team, has a clear vision for how skills-based volunteering can help further the Bank’s philanthropic objective of helping women and children in the Asian-Pacific region.


Making Progress Through Savings

June 14, 2012

Kimberly Davies is a program officer on Grameen Foundation’s Financial Services team.

Traveling to the field and talking with clients is the favorite part of my job.  I’ve worked in microfinance for five years and think daily about the poor women and families whom we support. Working with partner organizations and meeting clients face-to-face not only reminds me of why I’m in this field – it also helps me better understand the poor’s demand for financial services and the many challenges involved in providing those services.

It has been really exciting to see the progress of our microsavings project in India.  The first time I visited our partner organization Cashpor Micro Credit – a poverty-focused microfinance institution (MFI) in Varanasi, India – it was not yet offering savings products to its clients. This was partly due to complex Indian regulations requiring MFIs to work with banks to provide savings. Since then, Cashpor partnered with ICICI Bank and Eko Technologies (a tech provider that enables savings via the mobile phone) to launch a new savings product in the summer of 2011.

Microsavings accounts provide poor parents with a safe place to save for their children's future.

Microsavings accounts provide poor parents with a safe place to save for their children’s future.

Since the launch, Cashpor has added about 250 new savers every day, and currently has more than 60,000 savings accounts. Cashpor’s clients have spoken loud and clear about their desire to save. Clients told us during my last visit that they wanted their own safe savings accounts, but I wasn’t sure what the real demand truly was. It’s also challenging to offer convenient services to clients, because some do not have cell phones, most can’t read and many are even numerically illiterate. These challenges, on top of others, were things that I knew would take time to navigate.

However, the huge demand does make sense. A safe place to save is critical for families, because it helps them smooth consumption during times of sporadic income, or prepare for an emergency or a planned lifetime event. Of course, people want convenient tools to help them better manage their lives. In the United States, we have access to so many financial tools in our everyday life – various savings accounts we can access at any time, insurance, loans, locked CDs that yield a safe and consistent interest rate, etc. You name it, we have it. The poor want these same tools.

Truly moving out of poverty is a huge task. Though tools like the Progress Out of Poverty Index® can measure the likelihood that an MFI’s client base is poor and track its movement out of poverty over time, this is a complex thing to measure, because forces such as natural disasters and family illnesses can prevent people from moving out of poverty or cause them to slip back into poverty. These uncontrollable forces make the use of easily accessible and affordable financial tools – such as savings accounts – all the more important to the poor.

Again and again, I’ve seen with my own eyes and heard with my own ears how access to financial services has improved the lives of poor people and their families. I look forward to seeing Cashpor’s savings program grow even more over the next year, as they help more women and families in need.

Panel Explores the Power of the Mobile Phone in Fighting Poverty

May 14, 2012

Alex Counts is president, CEO and founder of Grameen Foundation, and author of several books, including Small Loans, Big Dreams: How Nobel Prize Winner Muhammad Yunus and Microfinance are Changing the World.

I first met Isobel Coleman, Senior Fellow for U.S. Foreign Policy and Director of the Civil Society, Markets and Democracy Initiative at the Council on Foreign Relations, through one of our greatest Grameen Foundation Board members, Lucy Billingsley.  When Isobel and I were introduced to each other, she was running a small program at the Council focused on women’s issues.  She has since grown it into a flagship initiative of this prestigious institution, and her reputation as a researcher and thought-leader has naturally grown along the way.

I was therefore very pleased when she invited me to speak as part of her Women and Technology series last week, alongside Ann Mei Chang, senior adviser for women and technology, Office of Global Women’s Issues at the U.S. Department of State (and formerly with Google), and Scott Ratzen, Vice President for Global Health at Johnson & Johnson.  The title of the session was “mDevelopment: Harnessing Mobile Technology for Global Economic Growth.”  We had a planning call with Isobel, Scott and Ann Mei the week before and I realized I was joining some extremely knowledgeable and articulate people.  To prepare, I read up on all of Grameen Foundation’s many programs that work to alleviate poverty by leveraging the mobile phone revolution, as well as some related research on inclusive business models.

Alex Counts makes a point while (from left) Isobel Coleman of the Council for Foreign Relations, Ann Mei Chang of the U.S. State Department and Scott Ratzan of Johnson & Johnson listen.

Alex Counts makes a point while (from left) Isobel Coleman of the Council for Foreign Relations, Ann Mei Chang of the U.S. State Department and Scott Ratzan of Johnson & Johnson listen.

The event was kicked off with remarks by Suzanne McCarren of ExxonMobil, which sponsors this speaker series.  Suzanne, whom I sat next to during lunch, explained why women’s economic development is a high priority for their company’s foundation, which has made more than $50 million in grants so far, according to my notes.  Then Cherie Blair, the former first lady of the United Kingdom and the founder of a foundation that bears her name, spoke.  She announced the release of an important new report titled, “Mobile Value-Added Services: A Business Opportunity for Women Entrepreneurs.”  I had met Cherie several times through Meera Gandhi, whose book Giving Back features the Cherie Blair Foundation for Women, as well as Grameen Foundation.



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