Author: Eugénie Constancias.
Entrepreneurs du Monde celebrates its 25th anniversary this year in style, with one of its microfinance institutions, Yikri of Burkina Faso, winning the European Microfinance Award 2023 on Inclusive Finance for Food Security & Nutrition. e-MFP reached out to hear more.
e-MFP: EdM celebrated its 25th anniversary this year, congratulations! Could you tell us a bit about how that journey has transpired - some milestones along the way, and how EdM has evolved in its focus and work?
Entrepreneurs du Monde (EdM): Thank you! The NGO EdM was born in June 1998, with a clear mission: to help particularly vulnerable women and men to improve their living conditions on their own, by creating or developing an income-generating activity. To achieve this, EdM has been setting up and supporting local organisations and over the last 25 years the NGO has expanded its activities in Africa, Asia, Haiti and even France without ever losing its identity. Starting out operating in the social microfinance sector, we gained a very precise picture of the budget and needs of vulnerable people we supported. That is why we decided to address energy poverty, professional integration of young people or entrepreneurship in agricultural settings. Let's take a look at a few milestones:
Back in 1998, EdM started by supporting Inter Aide's social microfinance programs: UPLiFT in the Philippines. In the early 2000s, we took over the management of programs initially carried out by the NGO Initiative Développement: Alidé in Benin, ID Ghana in Ghana and Palmis Mikwofinans in Haiti.
In 2005, the teams' day-to-day contact with vulnerable families enabled them to understand the impact of energy poverty, and the team launched the first pilots of future energy access organisations. In parallel, a number of disillusions prompted the NGO to rethink its modus operandi. We decided not to support existing MFIs, but to create new organisations from scratch, by recruiting and training local teams, and supporting them until they were autonomous. This new approach relied on jointly defined vision and mission and the implementation of rigorous social microfinance methodology. At the same time, a new partnership with the French Ministry of Foreign Affairs provided fresh impetus.
On January 12th, 2010, the earthquake in Haiti disrupted the actions of the NGO and its employees. Our in-depth knowledge of Port-au-Prince’s neighbourhoods and populations led our teams to cooperate with major international NGOs. In 2010, we started our impact investment activities by creating Microfinance Solidaire, a fund dedicated to providing loans to our network of organisations that could not yet attract investors. Investisseurs Solidaires came later in 2021 to take equity stakes.
From 2010 to 2015, in India, Cambodia, Vietnam, Ghana and Benin, social microfinance institutions showed good social results while achieving financial sustainability. In 2019, we decided to prioritise developments in rural areas, because smallholder farmers are the first victims of climate changes and are key to ensure food security for all.
Thanks to an effective methodological approach, strategic partnerships and rigorous management, Entrepreneurs du Monde has been able to consolidate its activities and earn the recognition of its peers. Today, we are active in 12 countries through 23 social enterprises mainly in the social finance sector, serving +180,000 beneficiaries – 85% are women with an average loan disbursed at 269 €.
e-MFP: You’re noted in particular for your focus on gender equity and mainstreaming. How has the sector evolved over the last couple of decades on this particular topic; where have there been significant advances, and where has it even regressed, or with much work still yet to be done?
EdM: EdM fully endorses the objectives of social justice and believes that taking greater account of gender equality issues will contribute to the fulfilment of our mission. We had been reflecting on gender issues for years and have continued in a more active way since 2017. Through are network of institutions, we were serving more than 85% women beneficiaries and wanted to make sure we were in line with our mission of empowering people. Adopting a ‘Gender and Development’ approach meant taking stock of the fact that unequal power relations prevent equitable development and the full participation of women. ‘Gender mainstreaming’ implies both the integration of gender into the design and delivery of products and services and taking it into account in the internal dynamics of the institutions, in order to bring about a profound change in power relations. This strategy echoes e-MFP’s 2022 Award publication that went ‘beyond how financial services providers serve women clients, and also encompassed how they ensure a workplace that is conducive to women’s ambitions, leadership and talent, and how they can lead by example in changing the norms that underpin gender inequity’. For those who would like to know more about Entrepreneurs du Monde’s gender mainstreaming approach, we have recently edited a document that highlights our eight key learnings.
From our perspective, we have seen significant advances over the last couple of decades with regard to gender equality. While progress has been made in some areas, challenges and disparities still persist.
Advances include:
Increased Access to Financial Services: Efforts to promote financial inclusion have led to more vulnerable people, women in particular, having access to financial services than ever before. The Global Findex 2021 saw the long-stagnant gender gap in developing economies decline from 9 to 6 percentage points in terms of account ownership.
Client-Centric Products: Beyond a myopic focus on outreach, it is worth mentioning that financial institutions have started developing products tailored to the specific needs of women in particular, recognizing their unique financial goals and constraints. In-depth analysis of the gendered context and of different segments of women and men helped design better products and services for both vulnerable men and women. At EdM, the social microfinance methodology (group methodology with individual liability) we promote includes features to address the needs of vulnerable women who have limited education levels, mobility, awareness of their rights, etc. and capacity to provide collateral.
Non-financial services: They are a key element for institutions seeking to empower people; training on income generating activity management, social awareness-raising sessions, and individual counselling are part of our social microfinance methodology. Complementary to financial products, those services are crucial to the rolling out of our theory of change. Empowerment considers both practical needs and strategic interests (advancement of social status, equal rights and opportunities, control of economic resources, participation in decision-making, etc.) of different segments of vulnerable people and differentiated roles of women and men.
But we should not be satisfied with the progress made so far. Setbacks can easily happen when our attention wanders. Fostering equal rights and opportunities for everyone in all aspects of life and of society does require the ongoing awareness and commitment of the inclusive and responsible finance community. In particular, there are several key challenges to remain alert to:
Addressing Gender-Based Violence: Gender-based violence both stems from and reinforces gender inequality. It is the most brutal manifestation of inequality and is a major human rights issue that endangers the life trajectories of women, girls and gender minorities in multiple ways, with a wide range of negative consequences not only for them, but also for their communities. Additional efforts should focus on fair and respectful treatment of inclusive finance clients in a setting where there is an asymmetry of power relations between those lending money and collecting repayments, and clients who owe money or are waiting for a disbursement. It is also about creating safe and supportive working environments for employees.
Digital Gender Divide: Digital financial services are potential drivers in promoting gender inclusive finance. But while these services have expanded access, digital gender gaps are not reducing as illustrated by the recent Mobile Gender Gap report by GSMA. Women have less access to smartphones, internet connectivity, and digital literacy, limiting their ability to utilise digital financial tools.
Legal and Regulatory Frameworks: Some countries have implemented policy and regulatory reforms to promote gender-inclusive financial services (i.e. monitoring sex disaggregated data, and promoting measures to eliminate discriminatory practices). Yet many things remain to be done to promote equal opportunities for women and men in the financial sector. Ensuring the enforcement of gender-inclusive policies and regulations is crucial. Governments and financial services providers need to better work together to create an enabling environment for better women's economic participation.
e-MFP: Yikri from Burkina Faso was announced as the winner of the European Microfinance Award (EMA)2023 on Inclusive Finance for Food Security and Nutrition (and Anh Chi Em in Vietnam, another EdM MFI, was a semi-finalist). Could you tell us about these two organisations, EdM’s role in their creation and development, and perhaps some of the other organisations you support?
EdM: Yikri and Anh Chi Em deploy social microfinance for poverty alleviation. Through a group methodology with individual liability, they provide products and services that are accessible to the most vulnerable groups, those excluded from conventional microfinance. Within groups, beneficiaries have access to a savings account, loans without collateral or security, and economic training (accounting, sales, stock management, etc.), technical training (agro ecology) or social training (prevention of disease, domestic violence, civil rights, etc.).
Anh Chi Em operates in Dien Bien province – a mountainous area in the northwest of Viêt Nam – with 4 branches and more than 6,000 beneficiaries. About 90% of them are women belonging to ethnic minority groups, and their main income comes from agricultural activities. Outside group trainings, Anh Chi Em supports its beneficiaries through counselling and market linkage. A specific focus is made on agriculture to build up beneficiaries’ competences to fight against and adapt to climate change, increase their crop productivity, and limit the risk of animal disease. The institution also enhances beneficiaries’ knowledge on sustainable agriculture and the preservation of the traditions of ethnic minorities: sustainable rice production, waste transformation by redworms, traditional weaving, and organic cotton production.
Yikri operates in Burkina Faso, a country with among the highest global levels of food insecurity as well as long-term socio-political violence. The institution currently helps almost 40,000 people. It has seen that over an average support period of three years, the number of its beneficiaries in extreme poverty is cut in half while their monthly net income is doubled. The 2023 EMA was a fantastic opportunity to recognise the institution’s work toward food security and nutrition. Yikri field officers are trained to recognise the warning signs of malnutrition in mothers and children and refer them to associations offering subsidized milk programs. Yikri has a subsidised agricultural loan coupled with training on sustainable agri-practices, including increasing crop production while reducing environmental impacts. The institution has also started "field schools" to demonstrate recommended farming practices, as well as value chain training that connects farmers with input suppliers and buyers.
EdM creates social microfinance institutions such as Anh Chi Em and Yikri. We provide technical and financial support to build sustainable and autonomous organisations. Entrepreneurs du Monde equips these institutions with appropriate operating procedures and management tools and strengthens their social and environmental performance. We also put in place registered local entities and create stable governance. From a financial standpoint, EdM covers institutions’ operating deficit until they achieve sustainability while our Impact Investing funds answer their loan and equity needs.
e-MFP: Where do you see yourselves in another 25 years from now, what would be your hope for EdM’s role and purpose then?
EdM: Our main aspiration is to broaden our impact by reaching out to more vulnerable people and addressing more effectively all their needs. We recently defined our strategy for the next three years and plan to serve 300,000 vulnerable people by the end of 2026, compared with 180,000 at present.
To achieve this, our approach is to continue to create and support social enterprises in the field of microfinance and beyond. The ecosystem or organisations created by EdM (the NGO and the Impact Investing Funds) can enable these social enterprises to scale up and become influential players within their countries. Moreover, expanding our activities in new territories and domains is crucial to extend and sustain EdM's impact on vulnerable people. In 2024, we are launching activities in Liberia and Forest Guinea. We are also implementing new projects: supporting internally displaced people in Burkina Faso with Yikri, fighting against climate changes effects in Senegal with Fansoto and promoting menstrual health in partnership with Assilassimé in Togo.
Convinced that the fight against poverty through entrepreneurship is a collective challenge, we consider it essential to join forces to build a social and solidarity economy dedicated to the financial inclusion and empowerment of vulnerable people.
About the Author:
Eugénie Constancias is Social and Environmental Performance Manager for Entrepreneurs du Monde. She leads the provision of technical support to reinforce the attainment of social and environmental objectives within the NGO’s affiliates in Asia, Western Africa and Haïti.
Photos: Entrepeneurs du Monde/Yikri
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