Mary Ellen Iskenderian MCS Regulatory Panel

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Mary Ellen Iskenderian MCS Regulatory Panel

  1. 1. Women’s World BankingPresident and CEO, Mary Ellen Iskenderian November 14, 2011 Women’s World Banking ®
  2. 2. Mission and Impact To expand the economic assets, participation, and power of low- Mission income women and their households by helping them access financial services, knowledge, and markets One day all women will be able to build a secure financial future Vision for themselves and their households • Largest network in microfinance, built over 30 years • 39 microfinance providers • 27 countries: 7 in Africa, 8 in LAC, 6 in Asia, 6 in EMENA Network • 26 million active clients, 80% women • $7 billion in outstanding loan portfolio • $3.5 billion in deposits • Average loan size of $1,200 2 Women’s World Banking ®
  3. 3. Savings: The Game-Changer• The poor can and do save through informal mechanisms; they need a safe place to save• What women clients want: • Commitment savings accounts for lifecycle needs: school fees, daughter’s wedding, housing (mimics benefits of ROSCAs) • Savings plans co-developed with MFIs • Marketing materials that is useful and understandable even if client is illiterate • Financial education: classroom, embedded in marketing, social soap and national communications campaign • Confidentiality: plastic cards with ID numbers instead of passbook accounts with balances clearly shown • Convenience: door-to-door collection, agent banking through neighborhood shops 3 Women’s World Banking ®
  4. 4. Adult Savings: Four Flagship Network Members SOLUTIONS Create over the next ten years innovative savings products and services for nearly seven million low-income people especially women in Latin America, Africa & Asia WWB TECHNICAL SERVICES Market Research, Product Design, Marketing, Sales Training, Customer Care and Alternative Delivery Channels RESULTS 520,000 voluntary savings accounts opened to date across partners Women’s World Banking ®
  5. 5. Young Women and Girls: A New Segment • Youth savings at MFIs in the Dominican Republic and Mongolia • The partnership presented an opportunity to expand savings to a new segment, increasing outreach in a new way • WWB is working with two network member MFIs to design, market and deliver savings products and financial education to girls and young women ages 7 to 24 • Results: Months since beginning of pilot 26 18 Nationwide roll out Gradually rolling Status 22 months ago out nationwide Accounts open 6,089 4,679 Average % of accounts transacting / 50% 39% month (last 6 months)* Average balance US$62 US$16 Financial education participants 17,143 2,533 Women’s World Banking ® 5
  6. 6. Making Savings Sustainable• Maintaining deposits for clients can be expensive for MFIs • Small account size • Frequency of transactions • High reserve requirements • Stringent KYC requirements• Regulators need to work with MFIs to enable lower cost approaches to taking deposits 6 Women’s World Banking ®
  7. 7. Alternative Delivery Channels• Alternative Delivery Channels (ADCs) can benefit MFIs and clients • Significantly reduce transaction costs for MFIs • Can open up new, lower-income and more remote markets• Regulatory issues • Regulators need to allow banking transactions to occur outside of branches• Implications for women • High potential for impact on women – 4.3 billion subscribers worldwide; 300 million fewer women than men – The convenience and lower cost of secure, confidential and appropriate products is a priority for women – Limited mobility, literacy, and capacity to control assets • Need to ensure technology is getting into the hands of women 7 Women’s World Banking ®
  8. 8. Youth Savings• The total global population of girls ages 10 to 24—already the largest in history—is expected to peak in the next decade • Girls have traditionally been overlooked by MFIs for a number reasons, their opportunities for economic independence are minimal • The accessibility of savings products and financial education programs tailored to low-income girls has significant implications for their economic and social empowerment • Girls as young as 10 regularly accumulate money, actively manage it, and want a safe place to save it• Regulatory considerations • Age requirements for savings accounts exclude youth from financial services• Gender issues • Girls less likely to be involved in activities where they can learn money management skills • Girls viewed as more expensive, generally not given opportunities to learn money and business management, earn money 8 Women’s World Banking ®
  9. 9. Regulations Can Unintentionally Create Barriers• Regulations, such as Know Your Client requirements and anti-terrorism measures, can hurt client accessibility • Proof of residency or proof of income are a hurdle for low-income people, particularly women • Many low-income women, especially those living in rural areas, do not have ID cards – Unique ID program (India) • Initiatives like “no frills accounts” with simplified KYC requirements are welcome • Regulators can help with clear guidelines that minimize uncertainty about how the standards will be interpreted 9 Women’s World Banking ®
  10. 10. On-lending: Benefits for MFIs• Savings are an alternative form of capital for MFIs • Local currency and lower cost • “Community” capital vs. external capital • Diversified and stable source of funds • Shifting funding mix towards deposits 10 Women’s World Banking ®
  11. 11. Growing Microfinance Representation within RegulatoryBodies Ela Bhatt Georgette Jean-Louis Appointed to the Board of the Appointed to the Haitian Central Bank’s Reserve Bank of India Board of Directors 11 Women’s World Banking ®

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