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Savings-Led Digital Finance: The Dawn of a New Era?
The digital lending market surpassed $300 billion in 2020, with significant growth among emerging markets customers who access “instant loans” from their mobile phones. But according to Philip Acton and Finn Tiedemann at DreamStart Labs Inc., there are growing concerns about the risky practices used by some of these digital lenders. They argue that one solution may come from a new generation of “savings-led” digital finance apps that use clients' savings capacity as a proxy for their ability to repay loans – a development they describe as an important milestone in digital finance.
- Categories
- Finance, Technology
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The Ins and Outs of Launching a Digital Savings Product in Kenya: Regulatory Guidance for Fintech Startups
Kenya is among the most advanced markets in the world in terms of fintech innovation and digital financial services. But according to Abby Butkus at BFA Global's Catalyst Fund, this innovation has yet to extend to digital savings, where the uncertain regulatory environment requires startups to be creative in their approach. She discusses four ways startups are approaching the regulatory process for their digital savings products, and shares a set of guides Catalyst Fund has released to aid founders in navigating the regulatory environments in Kenya and other countries.
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- Finance, Technology
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The Next Financial Inclusion Revolution: The Transformative Potential of Scaling Small Group Savings in the World’s Poorest Communities
Despite $52 billion invested in financial inclusion in 2019 alone, nearly 2 billion people – many of them among the world’s poorest – still lack access to formal finance. As Jeffrey Ashe at Grassroots Finance Action points out, these communities often turn to informal savings and credit groups to meet their financial needs – but there are many who are too poor and marginalized to be invited to be part of these groups. He explores a proposal that aims to expand access to informal savings groups to reach these financially excluded individuals around the world.
- Categories
- Finance
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Press Release: Bamboo Capital Partners Exits CONFIE After Triple-Digit Growth in Loans and Savings Portfolios
Bamboo Capital Partners (“Bamboo”), the specialist impact investor in emerging and frontier markets, today announces its successful exit from CONFIE, a Latin American microfinance investment holding company.
- Categories
- Investing
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Financial Inclusion During – and After – COVID-19: Three Takeaways From a (Very Different) European Microfinance Week 2020
The 2020 European Microfinance Week encapsulated much about the financial inclusion sector – the good, the bad and the simply confusing – as it navigated the historic challenges of the past year. Sam Mendelson at e-MFP shares three broad takeaways from the event, representing three key priorities for the inclusive finance industry as it seeks to adapt to the COVID-19 crisis – without overlooking other essential priorities.
- Categories
- Coronavirus, Finance
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Youth Saving and Spending During COVID-19: Tracking Young People’s Financial Activity in Nigeria
How are young people in Africa saving and spending money during COVID-19, when many of their previous sources of income have disappeared? Mahlet Alemayehu at L-IFT shares the results of a study in which 117 young people living in Nigeria kept a record of their savings and spending over several months. The data can help financial service providers anticipate how young people will need to use their accounts, and determine what other services they may need as they navigate the challenges of the pandemic.
- Categories
- Coronavirus, Finance
- Tags
- COVID-19, financial inclusion, research, savings, youth
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A New Mission for an Old Model: Unlocking Sustainable Water Through Savings Groups
To achieve universal access to clean water and sanitation by 2030, the world will need to quadruple spending to $150 billion per year. Given this financing gap, every investment in clean water counts. Yet according to Chris Prottas at The Water Trust, an estimated one out of three rural water points are broken across Sub-Saharan Africa, and the traditional community-led maintenance approach isn't working. He explores a promising solution: adapting the savings group model to provide sustainable water access.
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A Pandemic Response Based on Listening: Leveraging Customer Interviews to Understand COVID-19’s Impact in the Developing World
As COVID-19 spread around the world early this year, there was a flurry of data about its impact. But nearly all of it was gathered via online surveys, which omitted the 50% of the global population that lacks internet access. 60 Decibels responded by launching phone surveys with over 10,000 people in 13 developing countries to discuss their challenges and unmet needs. Kat Harrison discusses what they found.
- Categories
- Coronavirus, Impact Assessment
- Tags
- COVID-19, data, financial health, food security, interviews, NGOs, savings
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