YAO-NY core member Michelle Mak shares with us this report from last night’s panel at the Microfinance Club of New York.
Last night, YAO-New York members (and YAO-Boston visitors) met Ken Vander Weele, the CEO of the Opportunity International Global Leadership Team, at a Microfinance Club of New York panel, “Africa: The Microfinance Landscape.” Ken was part of a panel discussing challenges and opportunities in Africa, along with Donna Katzin (executive director of Shared Interest, a social investment fund with a focus on South Africa), Gil Crawford (CEO of MicroVest Capital Management), and Henri Dommel (director of Inclusive Finance Unit of UNCDF), moderated by J. Skyler Fernandes.
Among the opportunities discussed was the use of “branchless banking,” or mobile banks. These branches that operate out of vans have weekly routes, regularly stopping in rural areas to help customers save time and money they would otherwise use to travel long distances to make deposits at a branch. There have been other unforeseen benefits of mobile banking as well. Recently, during a drastic flood, Ken shared how the government of Malawi used Opportunity’s mobile banks to distribute subsidies to the people.
Another opportunity that Donna Katzin shared that was particularly compelling was the impact of additional training being offered to microfinance borrowers. She cited a particular situation in South Africa where borrowers received mandatory education about HIV/AIDS. Donna asserted that this training contributed to an improved repayment rate of 100% and dramatically reduced violence against people living with HIV/AIDS by 50%.
Donna’s comments reminded me of what Dan Yu from Opportunity China said recently about the training given borrowers in China. In addition to financial training, Chinese borrowers are also offered seminars on building family and personal values–holistic training to really transform lives, not just manage loans.
The panelists also discussed challenges on the microfinance landscape. They mentioned that there were high transaction costs due to the lack of population density and infrastructure throughout the continent. Also, finding qualified upper management in bank branches was cited as a challenge in a time of high management turnover. This is evident as “experienced and educated management” was the second biggest concern in the July 2009 Banana Skins survey of the microfinance industry, published by the Center for the Study of Financial Innovation.
Overall, last night’s panel was an exciting and informative event, and YAO was especially proud to have been there to support Ken Vander Weele. We are also excited to collaborate and build up microfinance awareness with other organizations with the same vision! Join us next Tuesday, June 15, at the Central Bar for an event featuring friends of YAO-NY, including Mark Narron (from Deutche Bank’s Community Development Finance Group), Sarah Buitoni (from Women’s World Banking), and Opportunity’s very own Daniel Yu (from Opportunity China) to discuss the current trends and challenges in today’s microfinance landscape!