Microfinance for Bankers and Investors: Understanding the Opportunities and Challenges of the Market at the Bottom of the Pyramid
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Double Bottom-Line Business…Socially Responsible SuccessAs an industry with annual growth rates of 30 percent over thepast six years, microfinance is becoming one of the best avenuesfor achieving what every investor wants: sustainable investmentopportunities for long-term growth and dramatic increases inmarket share.Technological advances make it cheaper to reach more and morecustomers. The purchasing power of low-income people is increasing.These and other factors make the time ripe for the private sector toinvest in the growth of the millions of people at the bottom of thepyramid.Microfinance for Bankers and Investors is the first guidebook forentering and profiting from this emerging market. This practicalroad map offers: Facts and figures demonstrating the outstandingopportunities in this sector Success stories from Citibank, Visa, Sequoia Capital,and other major companies Best practices and key insights from today’s top playersin microfinanceThe impressive global growth of microfinance is one of the fewbright spots in today’s difficult financial-sector landscape. Microfinancefor Bankers and Investors provides businesses an opportunity toengage in a double bottom-line business and provides the insights theyneed to tap into a market that has yet to reveal its full potential.Elisabeth Rhyne is managing director of theCenter for Financial Inclusion at ACCIONInternational, where she works to bringtogether leaders in financial services to addresschallenges facing the microfinance industrytoday. ACCION International is a leadingmicrofinance organization that providesmicroloans, business training, and other financialservices to low-income people startingtheir own businesses. Rhyne is the author offour previous books on the subject, includingMainstreaming Microfinance.
Preface viiIntroduction xiiiPart 1 Understanding Clients, the Market, and the Opportunities1 The BOP Market Up Close (and Personal) 32 Who Serves the BOP Market-and Who Doesn't? 113 Four Critical Challenges in the BOP Market 184 Products for the BOP Market 275 Three Products: Insurance, Housing Finance, and Remittances 34Part 2 Models and Corporate Choices6 Corporate Choices 477 Commercial Banks as Microlenders 578 Partners at the Last Mile: Retailers, Banking Agents, and Insurance Companies 669 Models of Financing Inclusive Finance 77Part 3 The Emerging Industry of Inclusive Finance10 Building the Infrastructure for Inclusive Finance: The Enabling Environment 9511 Credit Bureaus and Credit Scoring 10312 Last-Mile Technologies 11113 The Technological Base: Payment Systems and Banking Software 12014 Building the Market for Investing in Microfinance 126Part 4 Socially Responsible Returns15 Approaches to Social Responsibility 13916 Client Protection and Proconsumer Inclusive Finance 14817 Measuring the Social Bottom Line 158Cases 1 Banking ModelsICICI Bank: Shaping Inclusive Finance in India 167Citigroup Fosters Commercial Relationships with Microfinance Institutions 175Banco Pichincha and the Service Company Model 181Banco Bradesco: Twenty-First Century Postal Banking 188Cases 2 New Players: Retailers, Insurers, and TelecomsBanco Azteca: A Retailer Surprises Mexico's Financial Giants 195Vodafone: A Bold Move into Financial Services for Kenya's Poor 204G-Cash: Filipinos Text Their Way to Mobile Banking 209Cases 3 Industry DevelopersVisa: SocialBenefit Systems That Benefit Everyone 219Temenos: Creating Core Banking Systems for Microfinance 226Creditinfo: First Credit Bureau in Kazakhastan 231Cases 4 Financing ModelsMF Analytics and Citibank: The Securitization of BRAC Loans 239Credit Suisse: Bringing Compartamos to the Market with a Successful IPO 245Sequoia Capital: Private Equity and Indian Microfinance 252Cases 5 Social ResponsibilityANZ Bank: If the Mountain Will Not Come to Us, Then We Must Go to the Mountain 261Equity Bank Goes to Schools 266Triodos Bank and the Global Reporting Initiative 272Acknowledgments 279Endnotes 281References 299Index 317
