This latest Dialogue was written by e-MFP’s Sam Mendelson with support from Award consultants Katarzyna Pawlak and Ewa Bańkowska, and e-MFP’s Gabriela Erice and Daniel Rozas, and presents the housing programmes of the ten semi-finalists across several sections. Entitled Building New Foundations in Housing Microfinance, it looks at the innovations underway in what has for too long been a niche product, but which is growing in importance as MFIs respond to the fact that so many of their financial services are used for housing anyway. Now, they increasingly see the opportunity to innovate in providing a range of financial products and non-financial support to help clients improve their homes, addressing issues of safety, security, health and income-generation in the process.
Building New Foundations in Housing Microfinance opens with ‘The Challenge of Housing’, and outlines the factors which have kept housing microfinance so relatively peripheral in the past, even in the face of immense demand, and provable positive impact on clients of access to finance for quality housing. The second section is on the European Microfinance Award itself, and outlines the selection process, the eligibility criteria, and the factors that the adjudicators would look to in evaluating the housing programmes of the applicants. The third section presents the three broad ways that the semi-finalists helped clients improve the quality of their housing: providing finance for housing (via housing microfinance loans, micro-mortgages, savings and insurance), providing support for housing (via Construction Technical Assistance, client, staff or builder training, or provision of legal support), and providing social benefits through housing (by improving clients’ security, health, safety and environment, through the vehicle of housing finance).
Interspersed throughout these three categories of support, Building New Foundations in Housing Microfinance presents case studies of the ten semi-finalists and the innovation within each of their housing finance programmes.
The final section of the Dialogue distils the innovations among the varied initiatives into seven factors for success, including: a genuine commitment to Technical Assistance; use of partnerships; flexibility in products; income-generation opportunities; new approaches to collateral; new approaches to calculating household income; and – especially in the case of the eventual winner, Cooperativa Tosepantomin of Mexico – a holistic, demand-driven and multi-tiered response that reflects the complexity of the challenges being addressed.
Thanks from everyone at e-MFP to all the applicants, the members of the Pre-selection and Selection Committees and the High Jury who evaluated the applicants, and the consultants and e-MFP team who oversaw the Award process and this publication. And stay tuned for an upcoming multi-author book entitled Taking Shelter: Housing Finance at the Base of the Pyramid, which will build on the work in the Dialogue and provide a much-needed ‘deep dive’ into the housing microfinance landscape.
author: e-MFP
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