The Growing Global Need for Innovative Financial Solutions: Citi Foundation invites you to join an ongoing dialogue around financial inclusion
There’s a growing global need for innovative financial solutions. More than 2 billion people around the world lack access to financial services. High-potential businesses, in particular small and medium-sized companies and multi-bottom-lined enterprises, are too often hindered by inadequate access to capital, creating obstacles to economic opportunity. Similarly, information asymmetry and uncertainties about risk make it difficult for organizations to make lending decisions.
Innovation and collaboration are necessary to tackle these challenges. Together they can enhance client experiences, increase financing to growing enterprises, create tools to manage risk, and promote financial capability, inclusion and access to financial services.
As a funder working to expand financial inclusion and encourage innovations in finance that promote economic development, the Citi Foundation has seen a number of exciting innovations that have the capacity to make a major impact. Technology is reducing costs and changing the way financial services are delivered. Mobile devices make it possible for individuals and businesses to save, transfer money, and make payments in areas not served by extensive branch banking. Technology is also making it possible to determine credit scores and risk in countries where credit reporting infrastructure is limited or nonexistent, helping more businesses get the financing they need to grow, expand and create jobs.
Microfinance has evolved to provide a myriad of financial products in savings, credit and insurance, which meet the needs of different groups of people – from microentrepreneurs and smallholder farmers to students and aspiring homeowners – and enable them to seize opportunities and invest in their futures. Innovative financing mechanisms have even been used to promote global health. For example, the International Finance Facility for Immunization and the Pneumococcal Advance Market Commitments have enabled the GAVI Alliance to secure long-term funding for vaccines for developing countries, persuade manufacturers to expand their manufacturing capacity, and invest in R&D for new vaccines.
We envision NextBillion Financial Innovation as a knowledge platform, where a diverse group of experts and practitioners from a range of organizations can share their research or their work, and partake in discussions around financial products, financial capability research and technology. By sharing and learning from each other, we can draw inspiration, replicate and scale interventions that are effective, pilot new interventions, and connect with potential partners. These connections will help us achieve the shared goals of expanding financial services to the underserved, financing promising new businesses, and ultimately, improving the livelihoods of the poor.
The blog will launch with a series in which leaders from organizations like CGAP, Grameen Foundation, Innovations for Poverty Action and Intellecap contribute their insights on financial innovation. Its regular coverage will feature posts on the issues, innovations and organizations that are important to financial inclusion professionals, along with job and event listings, and in-depth coverage of conferences and other events.
We invite you to join the community, contribute, and participate in the ongoing dialogue.
Graham Macmillan is the Senior Program Officer for Financial Inclusion at the Citi Foundation. Hui Wen Chan is the Impact Analytics and Planning Officer at the Citi Foundation.