> Posted by Beth Rhyne
I participated in an exercise on imagining the future of microfinance with the members of the Microfinance Network today, led by Dave Ellis of the The Brande Foundation. Dave asked the participants, a group of about 30 CEOs and other senior leaders from microfinance institutions, to think about what they want for the microfinance industry in 10, 15, or even 50 years from now. Wild ideas welcome.
Among the dozens of ideas tossed out, a surprising number involved education. One person wanted to focus on youth and assist young people to develop an entrepreneurial mindset. Another suggested creating ways for clients to learn from each other, even across borders. Elementary education, vocational and skills training, education for girls, scholarships, business education, and financial education all surfaced as the stuff of dreams among people operating microfinance institutions.
Of course there were many suggestions more directly related to finance, like deriving a fail-proof credit scoring method, moving to a cashless payments system, and Sharia-compliant microfinance. I’m setting those aside, because I expected to hear about such things. What I did not expect was that so many microfinance operators nurse private dreams related to education.
What turns these financial service providers into education dreamers?
First, I think they hear it from clients. Many clients tell financial service providers about their aspirations for education, if not for themselves, definitely for their children. That has to be one source of education dreaming. But I think there is something more.
My hypothesis is that education is the constraint that becomes most noticeable once access to finance is provided. MFI leaders see clients every day who are no longer financially excluded but who are not moving out of poverty, at least not very fast. When they ask themselves what holds those clients back, they see that clients lack the know-how to build their businesses, or the skills to practice a trade, or the confidence to try something new. They believe that education has the potential to move those clients from the incremental gains that many clients make through microfinance to the breakthrough gains that are much less common. The education constraint may not surface in the daily flow of a microfinance executive’s business, but ask him or her to think into the future, and it pops right out.
For me it was telling that among the people who were talking about education were several from Middle Eastern countries who have been living through the Arab Spring, where the energy of youthful protesters has riveted attention on the challenge of building for the future.
So, if education is a secret, unspoken, or unrealized dream among many microfinance providers, how can they begin to act on that dream? It is a question well worth exploring.
Image credit: Andreruas
Have you read?
CFI Unveils Key Survey Findings in ‘Opportunities and Obstacles to Financial Inclusion’ Report
Smart Campaign e-Learning Module Wins Global Giveback Competition!
Vampires: Can They Make Financial Education More Fun?