I am currently working on gender, economic empowerment of women, women in agriculture, access to finance (credit, saving), entrepreneurship, youth inclusion, etc as an independent consultant with organizations including IFAD, ICCO, Oxfam Novib, Fair & Sustainable, etc
Dear colleagues,
Thank you for inviting us for this discussion!!
For food and nutrition security to be ensured, resources need to be at the hands of women. With DT Global we recently completed a Scoping Mission for EU Ethiopia. This study has also benefited much from another earlier comprehensive study (for CRS/USAID Feed the Future) titled ASSESSMENT OF CHALLENGES, BARRIERS AND OPPORTUNITIES FOR WOMEN, YOUTH AND PEOPLE WITH DISABILITIES IN ACCESS TO AND USE OF FINANCIAL SERVICE PROVIDERS, 2020.
https://assets.fsnforum.fao.org/public/discussions/contributions/Report…
Indeed, creating the ACCESS TO CREDIT to poor women was considered for long (since Grameen bank’s earlier years three-four decades ago) to be the most effective approach to empower women, ensure food and nutrition security . … HOWEVER in most recent discussions at FinEquity (@UNCDF/CGAP) the importance of ensuring women’s ‘’control’’ of such resources are more emphasized. … There are research outcomes highlighting the fact that women who are not sure of having control on her newly earned income (or even the newly accessed loan) are very RELUCTANT TO APPLY FOR LOAN, even when the service is available nearby, and easily accessible!! See an interesting recent discussion at CGAP/FinDev
https://www.findevgateway.org/blog/2022/06/how-do-savings-contribute-fi…
On the other hand,, women starting ‘’independent saving’’ can also give rise to mistrust and suspicion, and potential Intimate Partner Violence in many contexts where patriarchy is dominant. Efforts need to be made to promote mutual TRUST and ultimate collaboration. Gender transformative household methodologies such as the IFAD and Oxfam-Novib, Hivos supported GALS (Gender Action Learning System) are increasingly becoming appreciated in development interventions. More at Empower@Scale:
I hope this helps... and look forward to further fruitful discussion
Regards, Getaneh (Mail:- [email protected])
Dear colleagues
Thank you very much for this important discussion on – Reducing inequalities for food security and nutrition. …. One of the key resources to reduce inequality in access to food and nutrition is expanding access to finance to marginalized section of the population like rural women, youth, persons with disabilities, etc. As highlighted in the report, the challenge still remain!!
In many African countries like Ethiopia, the access to (formal) financial services (credit, savings, insurance, payments, etc) has been expanding for the last couple of decades -- particularly since the introduction of microfinance following the issuance of microfinance regulation 40/96 by the National Bank of Ethiopia (NBE). Yet the recent Global Findex database (World Bank) suggests that the percentage of adults (15+) with an account with a bank is just 35%. Only 11 % adults could borrow from a financial institution, and only 18% of adults reported being able to raise emergency funds from savings; others would turn to family and friends, or sell their assets. Though the agricultural sector, mostly represented by smallholder farmers, makes up a significant share of the Ethiopian economy, the sector represents only 11% of loan portfolios of financial institutions
In fact, the regulatory environment has been increasingly relaxed allowing especially MFIs to offer increasingly larger (and longer period) loans demanded by companies with the potential to create employment opportunities for others, including the introduction of alternative collaterals (movable collateral), agent banking, lease financing, etc,. Yet, institutions have been quite slow in adopting such modalities as they still enjoy a huge, untapped market, using their traditional (often group lending) modalities.
Business women are more likely to be affected since they are less likely to own properties which can serve as collateral, and enjoy much less connections with financial service providers, thus leaving the potential benefit from banking with them in-terms of unleashing their potential contribution to the economy, improving household welfare (including those of women) and their bargaining power. The youth also continue to have very little access as they (especially those from poor families), could not afford the material collateral, nor can they benefit from the mainstream Grameen style ‘’group lending’’ as they (especially those unmarried!!) enjoy the least social capital in many communities.
The focus of financial institutions has been largely on ''credit'', assuming that ‘’every one is a potential entrepreneur’’. As a result there has been scant attention to services like insurance and saving, otherwise valuable services for poor people leading vulnerable livelihoods. Evidences suggest that services like saving can be as important as (or even more important than) credit services for poor people. Especially for women facing ‘’patriarchal risk’’ safe and convenient saving devises can provide a secure mechanism to control income; and in fact such women who are not sure of controlling their hard-earned income could be reluctant to apply for an income generating loan – even when such services are available nearby, and easily accessible!!
There seem to be a lot of work to be undertaken at policy level, and making sure that well-intentioned policies are implemented on the ground). Strategies are also needed to work on patriarchal norms, which often dictate what are expected, valued and allowed for men/women, or boys/girls, as well as gender relations within the household. This requires more collaborative interventions among stakeholders.
See also discussion at
https://www.findevgateway.org/blog/2022/06/how-do-savings-contribute-fi…
Regards, Getaneh
Dear colleagues at FAO
Thank you very much for this great opportunity. We are currently engaged on a similar assignment of supporting agro-industrial parks, specifically on how they can strengthen the food system.
I would focus more on access to finance...
Learning from the past couple of decades on expanding access to finance to women, often using the Group Guarantee Lending Model (GGLM) pioneered by Grameen Bank in Bangladesh, there has been real progress on deeping the ''micro-credit'' service. There are many impact assessment reports, highlighting both positive, neutral as well as negative impacts. The conclusion seems that the actual impacts on poverty, food security, empowerment of women/youth, etc. are not what stakeholders (including donors) were expecting them to be. (See for example, MIT report by Banerjee, et al 2015 https://economics.mit.edu/files/10475... Given the huge, billions of dollars that have been flowing to such microcredit services (with very high expectation of immediate, positive impact on poverty), such reports even suggested re-consideration of alternative investment options for such money on other anti-poverty programmes (e.g health, education, etc).
Some of the factors contributing to the less than expected impact seem to include targeting errors. Financial institutions have been following ''blanket targeting'' assuming that every poor could be potential enterpreneur if they access finance. Especially for poor risk-averse people, in rural areas, including women, such financial services also need to be accompanied by proper business counselling, skill training, market linkages, etc., which were often absent...The commercialization derive (including high interest charges) of service providers have in fact been over-indebting households. Discontents in microfinance services was enhanced following the CGAP (housed in World Bank) report (2010): Andhra Pradesh 2010: Global Implications of the Crisis in Indian Microfinance https://www.cgap.org/sites/default/files/CGAP-Focus-Note-Andhra-Pradesh…, as well as reports, among others by the Guardian https://www.theguardian.com/society/2008/feb/20/internationalaidanddeve…. http://www.un.org/womenwatch/daw/csw/csw56/egm/Gobezie-RP-2-EGM-RW-Sep2… Such reports highlight many reported suicides (committed mainly by women) as a result of failure to repay institutional loan.
At household level, your report very well highlighted the increased labour burden on women, as they try to engage in small business, in addition to their household chores, not shared by their male counterparts... I believe the report should also highlight the increased Intimate Partner Violence many women face as a result of new access to finance (credit) from institutions which do not include some gender awareness for family members...Not all men do welcome their spouses being economically empowered through credit (much less to engage in household labour sharing activities), as they think this threaten their assumed power position with-in the household. Women often struggle to exercise control on credit, as well as on income generated...There is little effort to incorporate gender transformative interventions with such financial services.
One of the important instruments to ensure empowerment of women, enhancing their bargaining power with-in the household, is by enabling them to have control of such resources. In many contexts, especially rural areas of developing countries, enabling women to have control of resources (credit, generated income, etc.) is perhaps as important as (or even more important than) creating the access to credit. Many women who do not feel that they would have such a control would not use the credit (even if available at local level)... Institutional saving services were meant to provide such important tool of enabling women to exercise control. However, these services are very much under-provided by service providers globally (especially in rural areas)...Your report should also expand on this vital service.
Pension savings (saving for old age) are currently becoming even more popular in many countries where microfinance programmes are active providing such highly valued service for poor women. In Bangladesh, for example, wives are customarily younger than their husbands, and women tend to live longer than men. Women must anticipate a long widowhood, a cause of much anxiety. They hope that their children (especially their sons) will care for them, but are often not confident in such an outcome. If they could save up some money for old age, their widow hood could be more dignified. See blog http://cfi-blog.org/2015/05/27/would-you-like-a-pension-with-that/#comm…
I believe this also need to be highlighted, and advocated for.
I hope this helps!
Regards, Getaneh
Dear colleagues
Thank you for this very important Agri-PPP Guide. I strongly believe this will help plan effective collaboration.
I think there are two key issues for further discussion or elaboarion.
1) Since the participants can involve those from private sector (profit motivated) and those in Government, NGOs (often socially motivated), we need to decide the level of ''profit'' (and risk taking) that can be attained by those especially in the private sector, and to reach a concensus or mutual understanding on that level.... One challenge that we face in ruralfinance is the level of microcredit interest to be charged by banks and microfinance institutions (MFIs). As far as I know, so far, there is no consensus on a ''reasonable'' interest rate that need to be charged (though the components that should go into the computation are quite clear). Indeed, there are also those who strongly argue against ''any interest'' on credit delivered to businesses owned by poor people..... The confusion often gives rise to difficulties on collaborative efforts!!
2) How can we balance between ''INCENTIVE'' and ''MEASURES'' on those who fail to deliver as per commitments (see Box on page 11 on the Guide), especially for the private sector. May be the only MEASURE we can do on the private sector who fail to deliver is to remove the so-called incentive? What are the strategies to avoid potential crowding out of private sector actiors while doing so?
I think these are some of the key issues that need further discussion on the guide.
Getaneh ([email protected])
Thank you colleagues for managing this discussion on PPP. It is quite timely. ... PPP has potential for Leveraging Finance? YES. But for this to be reliased, I think there is a need for mutual understanding on access to finance, especially to the poor. I strongly believe that this is a highly misunderstood sector. For example microfinance institutions (MFIs) have expanded their operations in many African countries, now penetrating virtually every village, and reaching the very poor. They are playing a great role in supporting the poor access alternative financial services than the exploitative individual money lenders, pawn shops, etc. The beneficiaries (rather customers, clients) are appreciative of their existence, and regularly using the service. ... Unfortunately, so far, these financial service providers have been going alone, not integrtated with other service providers (e.g agric, health, value chains, etc), -- services which also target SAME poor!! This greatly limits their potential positive impact on their customers. ... Why no integration? Two answers: 1) The financial service providers do not bother much about to integrate with other service providers (or the potential positive impact on the poor). 2) The other service providers also do NOT bother about such integration, regardless of the potential impact. And, perhaps 3rd, the other service providers consider the financial service providers are just there to MAXIMIZE profit (as the Individual money lenders, which they said they are replacing!). Most important, there is no agreement, or consensus on the INTEREST RATE the financial service providers are charging. And there has not been any forum which gives attention to such issues.... Can this forum be the one to highlight on this very important issue... I look forward to hear from you all... Regards, Getaneh.
Dear colleagues, the microfinance sector is increasingly proving an effective way to reaching the very poor, and erradicating extreme poverty in a sustaineble way in many developing countries of Asia, Latine America and Africa. It opens access to small capital to the poor, even the very poor with no conventional materal collateral. In this way it facilitates the use of modern agricultural technologies that enhance producion and productivity. ... This is not limited to just available ''external resources'' in terms of credit to the poor. Better suited microfinance services also facilitates better financial management among the poor. Especially, such services can help the poor through modern ways of savings -- providing secure, convinient saving facilities where the poor can store extra income (whenever it is availabe) and availing it for use when it is needed. The poor can thus use such resources as need, for consumption, investment, meet emerhgenices, etc.
Indeed, there are growing evidences that the poor can finance most of their consumption and investment requirements from their own resources (without external credit!!) if suitable saving facilities are available... One example from Kenya (but there are many such cases recently) -- The biggest difficulty farmers adopting new technologies faced was not in ‘understanding’ the methods and their benefits, but in timing savings in order to purchase the fertilizer when they needed it. When financial tools were provided that solved this problem – cash proceeds collected from farmers at ‘time of crop sale’ and put in a ‘commitment saving’ account at a local bank -- fertilizer use and production increased.
The value attached to availability of flexible saving facilities is even greater by women, for whom secret accumulation of resources in a secure place provide additional advantage of stroing wealth, secure from many potential claims on (including from husbands). It has a great empowerment service, ...
Unfortunately, such demand-driven services are limitted in outreach in many contexts, especially in Africa!. Service providers have a lot of capacity challenges to meet real demands of the poor, especially the vey poor in rural areas (including those of women, youth, etc)
Oure earlier paper (from a comprehensive field assessment) is posted at CGAP/Microfinancegateway:
http://www.microfinancegateway.org/library/overview-practical-challenge…
Regards
Getaneh ([email protected])
Sr. Getaneh Gobezie
Hello all
Thank you for this initiatives..... I read previous contributions with great interest!
I appreciate especially the suggestions by Martin Nissen, and the reference to the (wrong focus) on ''single-targeted development approach''.....
Ultimately, the political will of governments to promote ''holistic development'' is critical, creating an enabling environment for all potential actors to play their roles effectively.... Engaging the private sector could be more emphasized here ... International NGOs like CARE (USA) have been investing heavily on innovative initiatives (@Feed the Future) to engage the private sector, especially to create employment opportunities for poor rural women, which ensures their ''control of income'' and bargaining power.... Linking entrepreneurial rural women with merchants in urban and semi-urban areas, such initiatives promoted a ''Microfranchising...''' Projects whereby women access consumable industrial goods (e.g iodized salt, soap, food oil, etc) in ''bulk'' which they would then distribute and sell in rural villages with small margin of profit. ... This enabled women not only to access demand-driven industrial items, but also can access it on credit bases (guarantees facilitated by the programme). ... It opened a new opportunity for earning income for women, but also enabled rural people to easily access such goods, sometimes also creating new demand for such goods.... Availability of such goods often promote inspirations among rural people, including more willingness to exert more effort of work to acquire income that would be needed to buy them (=Supply creates its own demand...??).... One key challenge reported in some African cases has been reluctance of the private sector to participate, or appreciate the BUSINESS CASE of such engagements.
Related report for Catholic Relief Service (CRS/USAID) is posted at
https://assets.fsnforum.fao.org/public/discussions/contributions/Report…
I look forward to hear more
Regards,
Getaneh ([email protected])