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Week one presentation


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Week one presentation

  1. 1. Introduction to Financing<br />Microfinance 101: Week ONE<br />Robert Gailey, Point Loma Nazarene University<br />WELCOME!<br />
  2. 2. 2<br />Brief Outline for Tonight <br />Introduction of Mr. Ali – learning about his business<br />Introduction of participants<br />Exploring how household financing works – group activity<br />What are some different approaches to financing and how does microfinance fit in?<br />Inspiration from Grameen Bank and Dr. Yunus<br />Outline of remaining weeks of class<br />Question Time<br />
  3. 3. 3<br />Introductions <br />State your name<br />Your institutional affiliation if you have one<br />Your first exposure to microfinance<br />What you hope to get out of the course<br />
  4. 4. Opening Questions<br />4<br />Why do people need financing?<br />What things/events do people finance?<br />What mechanisms exist for people to access financing?<br />
  5. 5. 5<br />Rutherford (2000 + Summer 2009)The Poor and Their Money<br />
  6. 6. 6<br />Old Chinese Proverb: A Fishing Analogy<br />Give a man a fish<br />(Traditional relief)<br />or<br />Teach a man to fish?<br />(more progressive development)<br />but<br />He still needs the TOOLS to fish and ACCESS to the water<br />
  7. 7. Difference between MED and MF<br />What is the economic objective of an MED/MF Intervention?<br />To build a business/enterprise: For start-up, expansion, or transformation.<br />To provide lump sums of money: For people to use for a variety of needs/wants<br />Which tools are available to meet the economic objective of the MED/MF intervention<br />Financial Tools: Involve some form of cash transaction<br />Non-financial Tools: Do not primarily involve a cash transaction<br />7<br />
  8. 8. MF and MED Tool Matrix<br />Economic Objective<br />Non-Financial Tools<br />Financial Tools<br />Microfinance Institutions (MFIs), Business ROSCAs and ASCAs, Business Insurance, Pre-Entrepreneurial Business Grants (such as Trickle Up Program), moneylenders.<br />Business Development Services (BDS), Livelihood and Vocational Training, Networking/Mentoring.<br />Helping a Business/Enterprise start, expand, or be transformed (from micro to small-scale or small-scale to medium-scale).<br />Helping an individual or family meet their needs/wants for Lump Sums of Money for use in emergencies, life-cycle needs, opportunities, and cultural obligations.<br />Emergency, cultural, and life-cycle ROSCAs and ASCAs, Post Office Savings accounts, Deposit Collectors, Money Lenders <br />Health education, literacy education, and other non-financial forms of information dissemination.<br />8<br />
  9. 9. Typology of Financial Services<br />Major Distinction<br />Financial Services<br />Methodologies<br />Grouping<br />Group Lending<br />Individual Lending<br />Loan fund generated within group<br />Loan fund provided from outside source<br />Source of funding<br />Size of groups<br />Village Banking<br />(e.g FINCA)<br />Solidarity Group <br />Lending<br />Accumulation<br />ASCAs<br />ROSCAs<br />Non-time-bound ASCA<br />Time<br />Time-bound ASCA<br />Latin America Model<br />Grameen Model<br />Ownership<br />9<br />
  10. 10. Primary Goals of Microfinance Institutions (MFI)<br />Breadth of Outreach (how many people served)<br />Depth of Outreach (how poor are people served)<br />Length of Outreach (serving people for many years)<br />Positive Impact (long-lasting and substantive)<br />10<br />
  11. 11. Vision of many MFIs<br />Providing many poor families with access to affordable financial services.<br />Creating indigenous sustainable institutions that can meet the long-term financial needs of their communities.<br />Improving social conditions—better health, sanitation, nutrition, education.<br />11<br />
  12. 12. 12<br />Outline for Rest of Course <br />Week 2: Focus will be on Microfinance Institutions, interest rates, key debates, <br />Week 3: Focus on local microfinance institutions – International Rescue Committee, Accion, CDC Finance – introduction and information<br />Week 4: Hearing from the clients, clubs, and investors – meet staff and clients from La Maestra, college clubs, and San Diego Microfinance Alliance, and local individuals who are invested in microfinance<br />
  13. 13. 13<br />Concluding Remarks<br />Questions/Remarks<br />Please turn in your tags<br />Come hungry next week – Client of Accion – Happy Joe Luck Kape<br />