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Author: Inez Murray. In the second in a series of blog contributions throughout the year to complement the European Microfinance Award 2022 on 'Financial Inclusion that Works for Women' , Inez Murray from the Financial Alliance for Women discusses the opportunity represented by the female economy and how financial institutions can best serve it. She overviews the business case for serving the women’s market by highlighting aggregate performance from the Financial Alliance for Women’s members. Although a lot of progress has been made, women are still disproportionately excluded from the formal financial system and make up more than half of the world’s unbanked population. There is also a significant opportunity to serve those women that are banked, more deeply. The female economy is a bigger than the GDP of China and India combined, but the financial services industry is still only beginning to unlock its full value. Financial institutions can positively impact their bottom lines and build a loyal customer base by serving the women’s market well. Women are controlling more of their own wealth and influencing most household purchasing decisions including where to bank. They are creating new businesses at greater rates than men; over a third of the world’s businesses are owned or operated by women. Women exhibit strong behaviors as customers—they are great savers and a reliable source of liquidity, are more likely to pay back their loans, and are loyal customers who stick with institutions that treat them well. The Challenge We know that most women are underserved by their financial services providers and many don’t have access to formal financial services at all. Those that do are largely dissatisfied. Women often want different experiences with their financial services providers than men do. They are careful decision-makers and prefer to have more information and more time to decide on significant financial actions but are more open to financial advice. They self-report less financial know-how and so want business and financial education. They are less networked and want to be connected. Above all, they want a relationship with their financial services provider, one that solves for their lifecycle needs. These preferences require a customer-centric approach that allows them to thrive and their businesses to grow. Financial services providers are data-driven organizations, but not always when it comes to women. Collecting quality gender data at each stage of the sales funnel is necessary for designing effective financial products and services. It is also necessary if regulators are to design truly gender intelligent financial inclusion policies. The Opportunity – A Win-Win Approach Learning from peers works. Nearly half the Financial Alliance for Women members have grown their women’s markets programs to the intermediate or advanced stage since joining the Alliance. Part of this is their ability to report sex-disaggregated data on their performance with women customers on a yearly basis. Our latest report shows very positive trends: Average loan sizes and deposit balances for women had reached 80 percent of men’s, far higher than their relative size in years past. Even as their loans sizes grew relative to men’s, women customers continued to pay back loans at greater rates, a fact we have seen each year regardless of loan type. Over 60 percent of retail and business banking revenue comes from women-centered financial offerings. The average non-performing loan rates are 1.5 percent for women clients across all segments – 53 percent lower than the rate for men. All proof that serving women with the holistic value proposition they need to succeed—access to finance, information, education, networking and recognition—is a win-win. Let’s Build on This Momentum We hope these insights encourage financial services providers around the world to emulate our Members and become the providers of choice for women. Whether you’re a financial services provider executive or work to promote financial inclusion, there are many ways you can get involved. Become a member of the Alliance and take advantage of our global clearinghouse for best practices and a unique platform for peer learning. Check out our resources library , which offers a wealth of information on how financial institutions can better serve the market. Spread the word by reposting to your social networks about the value of the Women’s Market. Only through action will better financial services for women become a reality. About the Author: Inez Murray is CEO of the Financial Alliance for Women and a recognized global expert in understanding consumer demand among low-income people for quality financial services. In this article, Inez discusses the opportunity represented by the female economy and how financial institutions can best serve it. She overviews the business case for serving the women’s market by highlighting aggregate performance from the Financial Alliance for Women’s members. The Financial Alliance for Women is an international consortium of financial institutions dedicated to championing the female economy. Its members work in more than 135 countries to build programs that support women with access to capital, information, education, and markets and are being recognized for their leadership role in driving the industry forward, all while growing their businesses in a sustainable way.

Author: Marina Dimova. In the third in a series of blog contributions throughout the year to complement the E uropean Microfinance Award 2022 on 'Financial Inclusion that Works for Women' , Marina Dimova from Women’s World Banking describes the importance of ‘women-centered design’ and outlines Women’s World Banking’s proprietary, five-phase approach to making financial products and services work for women. The Problem Although nearly 250 million women in developing countries finally have some form of access to financial services, 742 million women – three times that many! – still have no access at all. To put this staggering number into perspective, if these women made up a country, it would be the 3rd largest country in the world. Furthermore, there are an additional 246 million women with inactive bank accounts, underscoring the fact that access to financial services does not always equate to usage. These last 742 million women are the most difficult to reach for several reasons: they are typically located in rural areas with no connectivity or access to mobile phones and constitute the least educated and poorest demographic in their respective regions. So, while those 250 million women are certainly cause for celebration, as Mary Ellen Iskenderian, President and CEO of Women’s World Banking puts it: “ The global average hides the starker reality of the situation women face in many countries. In some countries it will take over 100 years to reach full inclusion without intervention .” We cannot afford to wait 100 years to reach full inclusion. Unequal access to technology will continue to expose an already-vulnerable population of women to even more risks in the long term. To give just one example, the gender gap in smartphone ownership has widened to 18%, up from 15% in 2021, which translates to 315 million fewer women than men owning a smartphone. [1] To reach full financial inclusion for women, we must act now. Why Design for Women? Women’s financial needs are unique. For example, in emerging markets, unbanked women are 25% less likely than men to say they could use an account self-sufficiently. [2] And so, the financial solutions and products geared towards women should be just as unique as their needs. While this idea is not new, the financial inclusion community has only recently begun evaluating how products are designed from a gender lens perspective. The emerging consensus has been that “one-size-fits-all” in fact means “one-size-fits-men.” To bring a gender lens to designing financial products, Women’s World Banking has revamped the design process we use to better suit women’s needs, so that women, especially low-income women, are empowered to be part of the solution. This philosophy is what the financial inclusion community has begun calling “gender-intelligent design.” The move towards gender-intelligent design has already produced several helpful resources, such as FinEquity’s “ Incorporating Gender-intelligent Design in Financial Services .” However, one significant gap remains: a holistic, practical approach on implementing gender-intelligent product design. The Solution – The Women-Centered Design Approach At Women’s World Banking, we believe that when women leverage financial tools that are built to serve their specific needs, they can bring about the positive economic, social and political change needed in our fast-paced, volatile world. To that end, we developed a women-centered design approach, a proprietary methodology to guide the development of financial products and services for the 742 million women around the world with little to no access to formal financial services. In essence, the women-centered design approach is a product development process that is inclusive, iterative, and adaptable to a constantly changing environment. The process features five key phases: In the Define and Diagnose phases, we define the problem that the solution aims to address and utilise customer research and business analytics techniques to understand its root causes. In the Design and Test phases, we develop the solution’s components and pilot them in a live environment to identify areas for further improvement. Finally, in the Scale phase, we create a product rollout roadmap and deploy the product at scale. One characteristic that sets our approach apart is that it designs for two crucial stakeholder groups: women customers and financial services providers . Both groups are equally important for the long-term sustainability of the financial products aimed to drive women’s financial inclusion. Designing for women customers lets us put the woman at the center, understand her needs and ultimately develop products that work for her and allow her to manage her financial life with ease and confidence. Similarly, designing for financial services providers helps us address their specific business and operational needs, while accounting for the financial viability and scalability of the solution. And for financial services providers, there are clear benefits to utilising women-centered design. Implementing this approach allows providers to gain a clearer picture of where women customers are on their financial journey. This valuable insight makes it easier for providers to build products that empower women to take control of their financial lives, with the added benefit of boosting product adoption and usage rates. Case Study – Activating the Use of a Digital Wallet among Factory Workers in Cambodia Over the past few years, Women’s World Banking’s team has engaged financial services providers and financial inclusion practitioners in workshops and programs to share and teach our women-centered design approach. We also leverage the women-centered design approach in our solution development advisory work. One such project is Women’s World Banking engagement with Network Member WING Cambodia to develop a solution to activate the usage of Wing’s digital wallet among women factory workers in Cambodia. The women-centered solution that was developed and deployed is an account education and ‘learn-by-doing’ initiative that utilises a training session as the main touchpoint to teach women factory workers about their account and how to download and use the Wing app to conduct key use cases of interest to women customers, such as saving and sending money to family members. What You Can Do to Empower Women Customers All of us in the financial inclusion ecosystem have roles to play in helping close the gender gap in financial services. We invite financial services providers around the world to commit to designing and deploying financial products that work for low-income women customers. And better serving women as customers can mean tapping into a $700 billion revenue opportunity . Here are some ways you can contribute to women’s financial inclusion and leverage women-centered design right now: Join Women’s World Banking’s Global Network , the only financial services providers network focused on serving the low-income women’s market through facilitating insights-to-action and women-centered product design. Register to attend Women’s World Banking Making Finance Work for Women Summit on February 15-16, 2023, in Dubai, to engage with industry leaders and investors and explore what’s next for women’s financial inclusion. Subscribe to our mailing list and stay up to date on the latest developments in women’s economic empowerment, such as the launch of our women-centered design publication in Fall 2022. [1] GSMA Gender Gap Report, 2022. [2] World Bank, 2022. About the Author: Marina Dimova is the Global Head of Financial Industry & Network Advocacy at Women's World Banking and a recognized designer with expertise in developing, implementing and scaling innovative solutions for social impact. Marina leads Women's World Banking Global Network of financial services providers to build a strong peer-learning community that shares best practices and knowhow and supports Network Members along their respective journeys to women's financial inclusion, but also is a strong voice and champion for women's financial inclusion for the financial industry. Women's World Banking designs and invests in financial solutions, institutions, and policy environments in emerging markets to create greater economic stability and prosperity for women, their families, and their communities. With a Global Network reach of 61 financial services providers in 33 countries serving more than 136 million women clients, Women's World Banking drives impact through its scalable, market-driven solutions; gender lens private equity fund; and leadership and diversity programs.

Authors: Bobbi Gray & Piyush Singh. In the fourth in a series of blog contributions throughout the year to complement the European Microfinance Award 2022 on 'Financial Inclusion that Works for Women' , Bobbi Gray from Grameen Foundation USA and Piyush Singh from Grameen Foundation India describe the opportunities mobile money can offer to women entrepreneurs, and the persistent sociocultural barriers that prevent them ‘coming forward’. Around the world, women do between two to ten times more care work than men [1] , with countries like Ghana and India on the extreme end. Time poverty and caretaking responsibilities are indicated as particular barriers that constrain women’s economic participation. Female entrepreneurs interviewed by Grameen Foundation in Northern Ghana note that household chores are “ time consuming, making our business less productive ” and the nature of household chores “ makes it difficult to [take] up certain businesses ,” limiting both when women can work, as well as the types of businesses in which women can participate. Sociocultural gender roles that expect women to address the caretaking and household workload increase economic inequality amongst men and women. These constraints to economic participation limit women’s financial inclusion as well, for the very same reasons. As one female entrepreneur shared, “it’s the culture of the people to always ask permission from your husband or head of family before going to any place. The reason for the request must be made clear,” except in the case of an emergency such as death, fire, or health. “Women are unable to fully access financial services because of the time spent on waiting for permission from their male counterparts.” Female mobile money agents have been highlighted as a solution for helping women access and effectively use digital financial services. Female mobile money agents located in their own communities can reduce the time and cost it takes to travel to make financial transactions, overcome constraints for requesting spousal permission, improve women’s trust of digital financial services and help women overcome limited financial and digital literacy by building their confidence in use of financial services through hands-on support. On the one hand, the solution seems easy: increase the networks of female mobile money agents. On the other, female mobile money agents are entrepreneurs and face the same social barriers as other women do when starting up a new business and accessing services. As one female mobile money agent in Ghana explained, “unlike my male colleagues I go home early and that affects my turnover.” Another female agent shared, “In simple terms, my failures and success usually depend on the level of support I get from my husband.” Recently, Grameen Foundation, along with its implementing partners in Northern Ghana, hosted a webinar to share the results from its gender and inclusion analysis and a rapid needs assessment that is informing the design and implementation of a 2.5 year initiative that seeks to recruit and train female mobile money agents, leveraging the MTN mobile money platform as a stream of business. While the MTN representative noted that becoming a mobile money agent is simple (a person simply needs to come forward; submit business registration and identification requirements; and meet the necessary liquidity investment) the MTN agent network remains primarily male-dominated. MTN shared during an interview, “We don’t have a lot of females working as an agent. If you see a woman working in the business, she is not the owner. She’s doing it for someone else.” The reality is that, for many women wanting to become a mobile money agent, the process breaks down at the “coming forward” stage. Women’s ability to identify their own strengths, to find time during an already-packed day, and the requirement for spousal permission and support means few women self-identify and come forward. One female mobile agent shared, “my husband and I collectively made the decision, his role was to give the go ahead and to give the assurance that he will support in terms of the initial investment to start the business. It is difficult to get all those documents, so we mostly rely on relatives or husbands to facilitate the registration.” These findings suggest we cannot underestimate the importance of recruiting “the family” when recruiting for female mobile agents, particularly in rural communities where social and gender norms are at their most conservative. A debate has played out across Grameen about how to engage men in recruiting and growing a network of female mobile money businesses. While there is deep concern that a spouse could take over a mobile money business, the truth is that husbands and wives (and other family) often run these types of businesses together when you ask them. Therefore, not involving a spouse during recruitment of female mobile agents could result in no woman coming forward at all. In fact, in India, a few BCNM institutions have shared that whenever their employees call a female agent to discuss the business, it is mostly the husband, father or brother who answers the phone call, and it is only after the initial conversation and screening by the male family member that the female agent finally is allowed to speak to the BCNM employees. Such instances make the process even more painful and time consuming for the BCNM institutions to recruit a female agent. Hence, household-level dialogues with the male and female members at the time of agent recruitment and onboarding, and onward, can ensure that female agents can garner household support for their new role, anecdotally resulting in increased retention and success over time. Moreover, improved training of male BCNM employees to engage male household members of the female agents in a gender-sensitive manner can also improve female agent recruitment. As we look forward to celebrating the finalists for the European Microfinance Award 2022 on 'Financial Inclusion that Works for Women' , these experiences in India and Ghana remind us that it is not just the design of the products themselves that matter for women, but the means through which they are marketed and delivered. When this involves female entrepreneurs in their capacity as mobile money agents, we must not underestimate the supporting environment they need as well, to be successful business owners and conduits for women’s access to digital financial services. Picture credits: Grameen Foundation USA and Grameen Foundation India About the Authors: Bobbi Gray is Senior Research Director at Grameen Foundation USA. She has more than 18 years of experience in designing, implementing and coordinating research and evaluation on financial, health and agricultural programs for underserved communities across Latin America, Southeast Asia and Africa. Much of her recent research and programmatic experiences include understanding the barriers and opportunities to women’s economic empowerment and developing programmatic and evaluation tools for the same as well as studying the unintended impacts of women’s economic empowerment initiatives on the lives of women and their families. Bobbi holds a Master of Public Administration degree in International Management from the Middlebury Institute of International Studies at Monterey and a B.A. in French and Spanish from Texas Tech University. Piyush Singh, Project Director of Innovation in Digital Finance with Grameen Foundation India, has more than a decade of experience working as a Consultant, Strategic Alliance head, and Product and Project Lead in the FinTech and Financial Inclusion domains. He has diverse experience of working in Digital payment, remittance, E-Governance, Microfinance Industry, Financial literacy, Business Correspondence, Mobile Money, and Pre-paid instruments. He has also worked on different layers of India Stack, Aadhaar, and other traditional and emerging Payment systems. He has done his masters from Xavier Institute of Management, Bhubaneswar (XIMB), and executive course from Columbia business school. He is a certified Digital Banking and Design Thinking Practitioner, along with certifications in Blockchain and Artificial Intelligence & Machine Learning for business. He is a thought leader in the Fintech and Financial inclusion domain and gets frequently invited to speak at national and global events. [1] https://www.oecd.org/dev/development-gender/Unpaid_care_work.pdf

Author: Myka Reinsch Sinclair. In the fifth in a series of blog contributions throughout the year to complement the European Microfinance Award 2022 on 'Financial Inclusion that Works for Women' , we have something a bit different: Myka Reinsch Sinclair reviews Alex Counts’ latest book ‘Small Loans, Big Dreams: Grameen Bank and the Microfinance Revolution in Bangladesh, America and Beyond’ , which tells stories of how financial inclusion has, for decades now, leveraged small but crucial gains to released women’s dormant economic potential and tackle global challenges. With the European microfinance community focusing special attention on women’s financial inclusion and celebrating the impressive work of the 2022 European Microfinance Award finalists, the publication of an updated edition of Alex Counts’ Small Loans, Big Dreams: Grameen Bank and the Microfinance Revolution in Bangladesh, America and Beyond could not be better timed. As an inclusive finance practitioner with over two decades of experience working at the level of communities, financial institutions and the broader sector around the globe, I found this book particularly inspiring as we look toward new horizons in women’s financial inclusion. By illustrating the tangible and intangible benefits of microfinance for women and their communities across two distinctly different contexts, the book inspires me to look more closely at how the powerful network effect of millions of financially included women can be leveraged to address major global challenges facing the world today. Small Loans, Big Dreams was initially published in 1996 during the decade leading up to the 2006 Nobel Peace Prize award to the Grameen Bank and Muhammed Yunus. This latest edition not only retraces the birth and evolution of the Grameen Bank and its pioneering methodology, but also offers thoughtful analyses of the evolution of the microfinance sector and women’s economic empowerment over recent years. By describing what he witnessed on the ground with women’s groups and Yunus’ team in Bangladesh during the early years of Grameen Bank, as well as through investigative research of several female entrepreneurs who were early adopters of microfinance in a notoriously poor inner-city neighborhood in Chicago, Counts revisits the roots, promise and challenges of the movement that “started a revolution in the banking and anti-poverty fields”. Through his update chapters, we get to examine the critiques, accomplishments and crises the sector has weathered over the years, alongside the ups and downs of individual women in Bangladesh and the United States—and the broader societal changes that have both resulted from and influenced the practice of women’s financial inclusion around the world. Often reading like a novel, the book plunges us into the worlds of microentrepreneurs in rural Bangladesh and urban Chicago, where we get to witness the lives, dreams, fiascos and triumphs of poor women microfinance clients through their own voices. We get to see not only the nuanced impacts that a stepwise series of small loans has on their individual livelihoods, but also the far-reaching and less measurable effects of the women’s collaboration amongst themselves, at times even after they have stopped being microfinance clients. Whether in a developing country or a world industrial power, these close-knit groups of marginalised women clearly value the opportunity to work together “in an environment where their economic (rather than domestic) responsibilities are the center of attention.” Although the original Grameen Bank model of group solidarity loans for women has since given way to more individualised lending and banking approaches for women, many successful microfinance institutions have found ways to maintain the upside of small group cooperation and the far-reaching effects this can have on the surrounding community. Throughout his book, Counts’ stories of the women’s interactions with their peers reveal the invaluable moral support, problem-solving, encouragement, networking and information-sharing that enable them to gain confidence, skills and economic resilience. We witness how one group successfully counsels a member to shift her energies toward higher production and sales of her delectable cookies so she can land enough extra cash to get her loan out of arrears; we see how group members step in when needed to babysit one member’s toddler or provide quick manual labor so another member can meet a production deadline. We also watch women compare market information, introduce a fellow member to a new supplier, and pool funds to afford a shared retail booth at a festival and place a bulk order at a discount. As Counts puts it, the groups become almost like “boards of directors” for the members’ nascent microenterprises. These mutually supportive business-oriented relationships that the women build among themselves over the course of their microfinance journey prove invaluable not only to the women’s confidence and morale, but also to the profitability of their businesses and their financial performance with the microfinance institution. Drawn into the lives and plights of poor microfinance clients in two distinct geographic and cultural contexts, we also begin to perceive surprisingly comparable benefits that go beyond household-level economic gains to improve race relations, social prejudice, women’s roles and domestic violence in their communities. In Bangladesh, for instance, we see how the biweekly interactions of women across ethnic and religious barriers leads a Muslim woman to realize the injustice of community discrimination and stand up for her Hindu neighbor’s basic rights. In Chicago, we witness the courageous, win-win idea of an African American woman who negotiates the sale of her products in a Korean grocery—thereby attracting black teens to the store, boosting her own sales and adding to the grocery’s profits, while building bridges across traditional race divisions. Later, when one Chicago woman’s repeated encounters with domestic violence can no longer go ignored, her group finds a way to imply to her abusive partner that she will no longer receive loans if the beatings continue—and they stop. Next, we cheer for a Bangladeshi woman who initially defers to her husband and covers her face reflexively with her scarf during bank meetings but who gradually emerges as her business thrives—eventually meeting with a male interviewer to confidently present her microenterprise operations while her husband stands by wordlessly at her side. Finally, when Yunus points out their power in numbers, Grameen women stream to the polls and end up voting down the party that would have curbed their new-found access to self-determination. While practitioners in the sector continue to innovate and expand access to appropriate financial services for women, it is important for us to keep in mind the unique value that microfinance offers to unite women, bridge socioeconomic and cultural divides, and enable them to influence broader societal change. While we work to render microfinance services as efficient and streamlined as possible—increasingly via digital technology from afar—how can we also maintain this invaluable opportunity for connection and collaboration? Without overburdening financial institutions, how can the inclusive finance sector build in mechanisms for this kind of exchange at the grassroots level and ensure that the network effect of microfinance can increasingly provide a platform for addressing other pressing challenges, like climate change and persistent social inequalities? As the inclusive finance sector matures, we are seeing more organisations seeking to add value for clients and their communities through initiatives and alliances that link women’s financial inclusion with other vital services. Counts describes for example how GrameenPhone piggybacked on the extensive network of trusting relationships between Grameen Bank and its clients to roll out an airtime rental business to poor women across Bangladesh, thereby offering a lucrative microenterprise opportunity as well as critical connectivity for poor villages; such a network would have been virtually impossible to build from scratch. By the same token, Grameen Shakti and others around the world are now leveraging networks of microfinance clients in villages that still lack electricity to make solar panel investments accessible and affordable—allowing millions to skip straight to clean energy while improving their daily life, productivity and educational prospects. It is inspiring to see the finalists for the European Microfinance Award in women’s financial inclusion also demonstrating the viability, business value and social impact of linkages to services such as health insurance, business training and domestic violence prevention, among others. As we prepare to gather for European Microfinance Week and honor the European Microfinance Award 2022 finalists at the forefront of making “Financial Inclusion that Works for Women,” the new edition of Small Loans, Big Dreams allows us to revisit the origins of the microfinance movement in women’s financial inclusion, and to delve into stories of how women have benefited from microfinance and its broader ripple effects in their communities. In light of the growing scale of women’s financial inclusion and current innovations as demonstrated by the European Microfinance Award finalists, it is inspiring to imagine the potential of women’s financial inclusion over the coming years to enable more women to build viable livelihoods, feed and educate their families, and even influence positive change on other pressing issues facing the world today. About the Author: Myka Reinsch Sinclair is an Independent Consultant in the inclusive finance sector. She has two decades of experience in economic development and inclusive finance with a focus on women, youth and smallholder farmers in Africa, Asia and Latin America. Myka spent six years at Freedom from Hunger (now part of Grameen Foundation), where she worked closely with microfinance institutions to implement Credit with Education and led a Gates-funded initiative to design innovations to address the health-related needs and defaults of women microfinance clients. She has also worked in inner-city economic development finance in the US. Her leadership roles have included CEO of Ayani Inclusive Financial Sector Consultants, Vice President of Programs at Freedom from Hunger, and Content Director for ADA’s 2019 edition of African Microfinance Week. Myka’s current initiative, the Teranga Tribune, is a multi-media magazine focused on inspiring and raising global citizens. Myka has served on the board of the Center for Agriculture and Rural Development (CARD MRI) Development Institute in the Philippines since 2011. She has been a member of e-MFP and collaborated with e-MFP’s Youth Financial Inclusion Action Group to co-author the publication Youth Financial Inclusion: Promising Examples for Achieving Youth Economic Empowerment . Photo: Myka with a Musoni women’s group in Kenya

Authors: Célia Fernandez & Amelia Greenberg. Kicking off our guest blog series of the year, e-MFP members Cerise+SPTF present the new SPI Online platform, giving the background to its development and the evolution of social performance management in the financial inclusion sector. It’s been more than 20 years since Cerise+SPTF built the first version of the SPI (Social Performance Indicators) audit tools in collaboration with purpose-driven organisations from the inclusive finance industry. Cerise and its founding members built the first version of the SPI audit tools in 2001, in collaboration with microfinance institutions and sector professionals. Our objective? To help financial service providers achieve their social missions. Once SPTF developed the Universal Standards for Social Performance Management (USSPM), Cerise updated the SPI to be aligned with the Universal Standards, and since then we review and update both resources jointly. In 2020, Cerise+SPTF created a digital version of the SPI. To date, over 800 unique organisations around the globe have used the SPI, and many integrate SPI evaluations into their ongoing performance monitoring. This year, Cerise+SPTF has launched a new version of SPI Online that offers free-to-use resources and assessment tools aligned with the most updated version of the Universal Standards for Social and Environmental Performance Management, which now include a mandatory seventh dimension on environmental performance management. (Note: Dimension 7 of the Universal Standards and the e-MFP GICSF-AG’s Green Index 3.0 are fully aligned at the concept level of the standards and essential practices.) SPI Online is a free, one-stop platform for anyone with an interest in managing social and environmental performance–financial service providers, impact investors, regulators, auditors, and other types of social businesses. Experts and newcomers to social and environmental performance can find the adapted audit tools and the technical resources to help them turn intentions into impact . SPI Online audit tools also measure compliance with a range of leading international standards including the Sustainable Development Goals, the UN Global Compact, and standards developed by the ILO and OECD. On January 31st, Cerise+SPTF hosted a webinar called “SPI Online Showtime” to share the new online platform with our global community. 320 participants joined live, from every major stakeholder group and from all over the world. This high level of participation shows momentum for social and environmental performance management (SEPM), which is guiding our common journey toward a “ better, stronger, greener impact in emerging economies ” ( Monique Cohen , Chairwoman of Cerise). Many stakeholders shared their appreciation for how the SPI audit tools have helped their organisations, and our sector, to be more sustainable and to create benefits for clients. You can watch the replay here . "Our joint venture Cerise+SPTF has become the reference for social and environmental performance management in the space of financial inclusion and purpose-driven businesses. We apply a fully integrated approach including setting and promotion of standards, assessment, and improvement of practices, reporting, benchmarking and practice demonstrations." - Loïc de Cannière, Chairman of SPTF, Impact Investment Professional at Incofin. The SPI Online platform gives access to training, news, co-funding, a database of experts ( SEPM Professionals Network ), an exhaustive resource centre (library and guide for auditing and implementing SEPM), and a technical help centre with answers to users’ frequently asked questions. Anyone can sign in on SPI Online to access the suite of 7 tools and start auditing. "Ultimately there is a collective responsibility to use the best tools in the market because if investors and other stakeholders are using it then ultimately the financial service providers have a tool where they present their information in a standardised way to a platform that becomes available to many stakeholders. The more stakeholders that are using that, the more beneficial it becomes for the FSPs, and the better the data becomes for benchmarking and trends." - Frank Streppel, Head of Global investments at Triodos One innovation on the new SPI Online platform is the suite of complementary assessment tools. The most comprehensive assessment tool is the SPI Full, but Cerise+SPTF also created six other tools, each using a different subset of the indicators in the SPI Full, to allow financial service providers to focus on the management practices that are most relevant to their current goals. Using a common set of indicators reduces the users' reporting burden with a common framework and complementary functionalities. Each tool generates specific social and environmental dashboards to summarize gaps and strengths and identify the actions for improvement . One innovation on the new SPI Online platform is the suite of complementary assessment tools. The most comprehensive assessment tool is the SPI Full, but Cerise+SPTF also created six other tools, each using a different subset of the indicators in the SPI Full, to allow financial service providers to focus on the management practices that are most relevant to their current goals. Using a common set of indicators reduces the users' reporting burden with a common framework and complementary functionalities. Each tool generates specific social and environmental dashboards to summarize gaps and strengths and identify the actions for improvement . Audit Pathways and Tools The suite of tools is designed for 3 pathways to assess, manage and report: The Universal Standards Pathway The Client Protection Pathway The Green Pathway 4 tools are dedicated to the Universal Standards Pathway : With the ESG risk tool, you will measure ESG compliance and better manage social and environmental risks. The tool is aligned with the current European regulation (SFDR) and key international standards, such as the International Labor Organization standards for decent work. The tool ALINUS is designed as a due diligence tool across the seven dimensions of the Universal Standards, to let investors screen, monitor and report the social and environmental practices of their investees. With ALINUS, you get 3 reports: ESG Risk for reporting, ALINUS for your investment committee, and CP Commit to guide your investees on Client Protection. With SPI5 Entry , you will take the first step on your social and environmental performance management journey. And going further, SPI5 Full includes all indicators of the Universal Standards and all indicators of Client Protection. You will get a comprehensive social and environmental performance assessment. 2 tools focus on the Client Protection Pathway : With CP Commit , a sub-set of ALINUS, you will have an overview of the fundamental practices of client protection and a first step on the Cerise+SPTF Client Protection Pathway With CP Full you get a comprehensive assessment of Client Protection Standards, so you can identify which gaps you must fill before going for a Client Protection Certification. 1 tool is dedicated to environmental performance management, as a Green Pathway: The Focus Green tool assesses specifically the 7th Dimension of the Universal Standards, co-developed with the e-MFP Green Inclusive and Climate Smart Finance Action Group . In the coming month, Cerise+SPTF will draw on the power of data , ramping up the SPI Online platform with new functionalities to serve the needs of purpose-driven organizations–in the short run, a module for analysis, with options for customised benchmarks to compare the results with your peers. Cerise+SPTF will also provide new webinars & FAQs to guide SPI Online users, experts or newcomers, in handling the assessment tools and going one step further in their journey to achieving a positive impact. Replays of live demo sessions are already available here . Our thanks to everyone who has joined us in this journey. We hope the SPI Online makes it even easier for you to do the work you want to do, and we look forward to our continued collaboration. Help us spread the word about SPI Online and the Universal Standards: Communication Toolkit Stay informed by joining our mailing list Learn more by visiting the SPI Online website . Written by Célia Fernandez, Head of Communication at Cerise Edited by Amelia Greenberg, Deputy Director of the Social Performance Task Force (SPTF) About the Authors: Célia Fernandez leads all internal and external communications, including social media, and also manages internal administration for Cerise. As part of the SDG Project (LabODD in French), Célia facilitates working groups and gives training on outcomes measurement. She holds a master’s degree in human rights and humanitarian action from Sciences Po Paris. She has 5 years’ experience in project management for NGOs in Morocco, as well as experience as a Quality Manager (ISO 9001 Standard 2015 version). She speaks French and English. ​ Amelia Greenberg is the deputy director of the Social Performance Task Force (SPTF), where she has worked since 2010. Among her responsibilities within SPTF, Ms. Greenberg manages the Responsible Inclusive Finance Facility for Sub-Saharan Africa, oversees updates to the Universal Standards for Social and Environmental Performance Management, plans SPTF annual meetings, leads SPTF’s outreach in Francophone regions, and runs both the Outcomes and the Responsible Digital Financial Services working groups. Prior to joining SPTF, Ms. Greenberg spent two years working in strategic consulting for nonprofit organizations, and before that, worked for six years as an economic consultant. Ms. Greenberg has master’s degree in international relations from The Johns Hopkins University, with specializations in international economics and international development, and a bachelor of arts from Brandeis University, where she graduated summa cum laude with a double major in economics and French literature. Ms. Greenberg speaks English and French.

Author: Myka Reinsch Sinclair. Kicking off a series of guest blogs on the topic of the European Microfinance Award 2023 – Inclusive Finance for Food Security & Nutrition – EMA2023 consultant (and e-MFP member) Myka Reinsch Sinclair outlines the scale of the challenge, and the role that financial inclusion organisations can play in combatting food insecurity and malnutrition. The negative trend in food security Despite impressive growth and innovation in inclusive finance strategies to reduce poverty, the fundamental problem of world hunger is still on the rise. Food insecurity currently affects at least 10% of people worldwide, disproportionately impacting the global South. According to the World Food Programme , “828 million people go to bed hungry every night. The number of those facing acute food security has soared… [and] a total of 49 million people in 49 countries are teetering on the edge of famine”, with 2022 expected to register “a food crisis of unprecedented proportions, the largest in modern history”. The FAO pointed out in its 2022 State of Food Security report that global food insecurity had grown by 150 million people since the onset of the COVID-19 pandemic. Considering the full range of food insecurity and malnutrition, experts estimate that as many as two billion people remain undernourished worldwide. Based on this current trajectory, global experts (including FAO, IFAD, UNICEF, WFP and WHO) predict that fully 8% of the world’s population will still be coping with hunger in 2030, the year by which the 2015 UN Sustainable Development Goals had targeted to end world hunger altogether. The recent, strong uptick in hunger has been attributed to a combination of climate change (leading to environmental disasters that undermine agricultural production), economic shocks (including acute supply chain disruption from the COVID-19 pandemic), geopolitical conflict (including the war in Ukraine, where a significant portion of the world’s wheat and corn is produced), and the increasing chasm between rich and poor around the world. Inclusive finance and food security & nutrition The shocking scope of world hunger today, the urgent need for efficient and effective strategies to address it, and the potential of microfinance to make a difference have inspired the theme for the 2023 European Microfinance Award: Inclusive Finance for Food Security & Nutrition . When I began working nearly two decades ago with Freedom from Hunger (now part of Grameen Foundation), we focused explicitly on addressing the root causes of hunger through microfinance. We collaborated with banks, microfinance institutions and NGOs promoting savings groups to develop multi-sectoral, financially self-sustaining approaches to equip poor women and their families to overcome chronic hunger and poverty, and we saw promising results. As the financial inclusion sector has matured, the appetite for such holistic, value-adding strategies has only grown. The time has never been better to leverage the scale, impact, and ingenuity of the financial inclusion sector to help tackle the urgent social development challenge of hunger and malnutrition. Although improving food security has never been a direct focus of financial inclusion, hunger and malnutrition are of course integrally linked to poverty. Poverty is at once a major cause and result of food insecurity. Microfinance can therefore affect all four dimensions of food security: availability, access, utilisation and stability of “sufficient, safe, and nutritious food that meets [people’s] food preferences and dietary needs for an active and healthy life,” ( The International Food Policy Research Institute ). To wit, without economic resources: farmers cannot produce high-quality crops to eat or sell (availability); households cannot afford to buy enough nutritious food to feed their families (access); low levels of education, unaddressed health problems and poor sanitary conditions can impede people’s ability to select and absorb healthful nourishment (utilisation); and people are less able to cope in the face of political unrest, climate disasters or seasonal food shortages (stability). As a tool for addressing poverty, then, financial inclusion has a vital role to play in enhancing people’s economic wherewithal to ensure adequate food and nutrition for themselves and their families. Conceptualising food security – and ‘hidden hunger’ It is important to understand that food security occurs on a continuum . People can be persistently food insecure (regularly and repeatedly unable to access and utilise sufficient nourishment), chronically or seasonally food insecure (facing periodic shortages, usually due to predictable circumstances), or can experience ‘transitory’ food insecurity due to an unexpected event, such as drought or war. Moreover, hunger is not just about the availability of and access to food; malnutrition falls on the food security spectrum, and it is also serious. Sometimes called the “ hidden hunger,” malnutrition can occur when there is inadequate caloric intake (insufficient quantity/frequency of food) – especially during childhood development, or when the food consumed lacks nutritional quality or balance. For example, some people may have access to enough of one staple food to avoid feeling hungry, but their inadequate consumption of protein or other nutrients can still lead to malnutrition that stunts children, undermines productive energy and weakens overall health. Undernourishment and malnutrition can lead to a negative cycle that reinforces intergenerational poverty. This is why the term ‘food security’ is often accompanied by ‘nutrition’. Food insecurity and malnutrition are caused by a complex combination of interrelated factors that occur at multiple levels of society. At the macro level, government policies–including agricultural sector incentives, international trade and transportation infrastructure investment– and population growth play a critical role. At the micro level, people’s household food behaviours are influenced by income level, education, cultural and social norms, and which foods are affordable and locally available. Between these two levels are behaviours of all the actors in the food system , including small-scale and industrial farms, offtaking companies, consolidators, processors, distributors, transport services, marketing, packaging, storage facilities, importers, exporters, food companies, supermarkets and vendors, among others. Climate is an overarching enabling factor–determining what can be cultivated, how much, where and when–and one that is increasingly causing food security disruptions and risk. All these elements interact to determine the level of food security and nutrition of a given population. There are various drivers of food insecurity. These include: the unsustainability of food systems , the rising costs of food and the low quality of input material for food production. Unfortunately, financial inclusion does not always have a positive influence on food security. For example, while access to credit can boost livelihoods, household income and food security, the necessity of making on-time loan payments (in order to retain access to finance in the long term) can also exacerbate food insecurity, because clients may choose to reduce food consumption or even go hungry in order to direct available resources to loan maintenance. This troubling loan repayment-over-food trade-off subverts the mission of the financial inclusion sector. So, although financial inclusion has the capacity to help alleviate many root causes of hunger and malnutrition, it can also have inadvertent negative impacts when clients’ food security status and practices go ignored. The role of the inclusive finance sector So, what can financial organisations do? Because of the close connection between poverty and food security, there is a broad spectrum of financial inclusion services that ultimately influence the food consumption and nutrition of clients, their households, and the broader community. While financial inclusion is never a panacea and it’s important not to overload the sector with unrealistic and unfair expectations, there does exist a vast array of innovative products and partnerships that combine the power of financial inclusion with other ingredients to enable people to overcome hunger and malnutrition. Such interventions include agricultural finance and risk management, digital platforms uniting food actors across the food value chain, financial product design adapted to food security conditions and agricultural calendars, transportation infrastructure investment, mobile apps promoting healthy behavior change, livelihood development, health protection, nutrition, education and water and sanitation programs, among others. As a longstanding practitioner in the financial inclusion sector and a member of European Microfinance Platform, I am delighted that the 2023 European Microfinance Award will highlight the crucial connection between food security and financial inclusion. I look forward to seeing the discussions and innovations on this topic over the coming months. About the Author: Myka Reinsch Sinclair is an Independent Consultant in the inclusive finance sector. She has two decades of experience in economic development and inclusive finance with a focus on women, youth and smallholder farmers in Africa, Asia and Latin America. Myka spent six years at Freedom from Hunger (now part of Grameen Foundation), where she worked closely with microfinance institutions to implement Credit with Education and led a Gates-funded initiative to design innovations to address the health-related needs and defaults of women microfinance clients. She has also worked in inner-city economic development finance in the US. Her leadership roles have included CEO of Ayani Inclusive Financial Sector Consultants, Vice President of Programs at Freedom from Hunger, and Content Director for ADA’s 2019 edition of African Microfinance Week. Myka’s current initiative, the Teranga Tribune, is a multi-media magazine focused on inspiring and raising global citizens. Myka has served on the board of the Center for Agriculture and Rural Development (CARD MRI) Development Institute in the Philippines since 2011. She has been a member of e-MFP and collaborated with e-MFP’s Youth Financial Inclusion Action Group to co-author the publication Youth Financial Inclusion: Promising Examples for Achieving Youth Economic Empowerment .

Authors: Célia Fernandez & Joana Afonso. The e-MFP Investors AG and Cerise+SPTF, through SPTF’s Outcomes Working Group and Cerise’s LabODD (SDG Lab), have been working on outcomes management and measurement since 2015. Successive projects have raised awareness among different stakeholders and developed tools to support the necessary and complex task of measuring client outcomes, analysing the findings and converting these findings into action - managerial decisions to improve existing programs and design new products and services that effectively respond to different clients’ needs. As the Sustainable Development Goals (SDGs) became more commonly accepted and used in the development field, Cerise+SPTF and the e-MFP Investors Action Group started a project in 2019 to explore innovative approaches for investors and Financial Service Providers (FSPs) on measuring and reporting outcomes using the framework of the SDGs . As a major output of this work, in March 2022 the report " Outcomes Management for Financial Service Providers: A proposed standard framework aligned with the Sustainable Development Goals " has provided a framework of actionable indicators based on the SDG targets that can answer the need for a simple, credible methodology to monitor outcomes: one that is built on a well-defined social strategy and theory of change, and that is assessed regularly through internal data management systems. The SDGs are ambitious, and the framework can feel overly theoretical (or overwhelming) at the micro level for impact-driven organisations, with the 17 Goals broken down into 169 targets and more than 280 macro-economic indicators. Thus, extensive work was conducted with different social investors and FSPs to identify and test the most relevant targets and indicators. From these exchanges, three SDGs were selected as the most relevant for the financial inclusion actors - SDG 8 (Decent Work and Economic Growth), SDG 1 (No Poverty) – focusing on outreach to the vulnerable - and SDG 5 (Gender Equality). This selection does not imply an exclusive use of these indicators. An FSP can decide to add other indicators, or to collect different indicators, since data collection must be driven, above all, by data that can inform business decisions. Nonetheless, it is possible to define a core set of indicators that can likely be applicable to most FSPs and facilitate benchmarking with similarly purpose-driven institutions. Between September and November 2022, the e-MFP Investors AG and Cerise’s LabODD co-organised a series of events, both online and in-person, aiming to share lessons learned and exchange experiences between social investors and FSPs. These events included the Outcomes Management Workshop Series online meetings with Investors (13 September) and FSPs (20 September); the Outcomes Sessions at the Cerise + SPTF Annual Meeting 2022 (28 & 29 September); and the European Microfinance Week (EMW) 2022 Panel Session ‘The Drivers for Better Outcomes’ and Working Session (16 November). During these events, participants shared concrete experiences and discussed the potential standard indicators as well as the necessary willingness to understand changes experienced by customers. They have also considered the relevance of data quality, the challenges of collecting it, and the capacities needed to conduct data analysis and use its findings in decision-making. During the e-MFP Investors AG and LabODD Working Session at EMW 2022, it was rewarding to see significant contributions to harmonising outcomes management from social investors and responsible FSPs , with two investors sharing their experiences. Kawien Ziedses des Plantes, Sustainable Impact Manager at Oikocredit , presented the methodology used and the lessons learned from their survey program focused on clients’ perceptions of change. She highlighted how the program reached 18,500 end-client respondents and contributed to integrating the voices of clients in the process of improving products and services. Subsequently, Mathilde Bauwin, Head of Knowledge Management at ADA (Appui au Développement Autonome), shared how ADA structured a sample questionnaire that follows the theory of change for a financial services provider (FSP), with the objective of identifying the outcomes of the services offered to the clients, understanding how these outcomes occur (contribution vs. attribution), and providing useful information for the FSP to improve their services. In her presentation , she emphasised how this methodology is applicable to different sectors. Throughout the different events organised in 2022, discussions focused on agreeing on a common set of outcome indicators and a core social outcome questionnaire to collect reliable and useful outcomes data from the end clients. Based on the results of these discussions, during the working session at EMW 2022, Cerise+SPTF presented a proposal for the outcome questionnaire and list of potential standard outcome indicators . These tools aim to support both FSPs and the related stakeholders (e.g., investors, networks, regulators ) in collecting and analysing relevant data that contributes to informed decisions for building strong social and environmental strategies and operations, to ease the reporting to the various investors, and to better understand the impact of financial services on the end clients. Participants in the session were asked to review the proposed questionnaire and provide feedback. Investors and other stakeholders have noted several points to refine the questionnaire, including reviewing details of questions/indicators to be adapted to different contexts/types of FSPs and avoid redundancies; adding questions on consumer risks such as fraud, hidden fees or agent relation risks; and discussing the link with the Financial Health/Customer Outcomes Framework proposed by CGAP, as presented by WSBI . As of now, the Cerise’s LabODD team is summarising the feedback received and will host a co-development workshop on May 4, 2023, aiming to collect the last inputs from investors and FSPs on the proposed questionnaire and list of standard outcome indicators and to provide simple guidance for field surveys on customers. These will be included in the new version of SPI Online assessment tools by the end of 2023. Bearing in mind that the better the FSPs understand the changes experienced by their customers, the better decisions they can make to further implement their social and environmental objectives, the on-going collaboration here presented - result of extensive work from multiple sector stakeholders - gives a roadmap for this. About the Authors: Célia Fernandez , leads all internal and external communications, including social media, and also manages internal administration for Cerise. As part of the SDG Project (LabODD in French), Célia facilitates working groups and gives training on outcomes measurement. She holds a master’s degree in human rights and humanitarian action from Sciences Po Paris. She has 5 years’ experience in project management for NGOs in Morocco, as well as experience as a Quality Manager (ISO 9001 Standard 2015 version). She speaks French and English. Joana Afonso is Financial Inclusion Specialist at the European Microfinance Platform (e-MFP) where she coordinates the e-MFP Action Groups and is a member of the content team working on the European Microfinance Week, European Microfinance Award and e-MFP research related activities. Joana has experience both as practitioner and researcher in the financial inclusion sector. She has previously worked as a microcredit officer at an NGO in Portugal and conducted research on client over-indebtedness and impact evaluation methodologies in microfinance, with field work in the Dominican Republic, Pakistan, Zimbabwe, and Ecuador. She is co-editor of the book “Emerging Challenges and Innovations in Microfinance and Financial Inclusion” (2019). She holds a PhD in economics and finance from the University of Portsmouth, UK, and a masters in microfinance from the Université Libre de Bruxelles, Belgium.

Author: Bobbi Gray. Next up in our series of guest blogs on the topic of the European Microfinance Award 2023 – Inclusive Finance for Food Security & Nutrition – Bobbi Gray from Grameen Foundation considers the (intolerable) sacrifices that poor households make to meet their financial services obligations, and the responsibility of the sector to address this. Almost 10 years ago, I’d finished the book The Last Hunger Season , by Roger Thurow. I was so impacted by the book that I wrote two blog pieces ( here and here ) considering the relevance of the book to our work in microfinance. As noted in Myka Reinsch Sinclair’s blog launching the European Microfinance Award 2023 – Inclusive Finance for Food Security & Nutrition, our work at Freedom from Hunger and then through the merger with Grameen Foundation was grounded in the theory that microfinance plus health and nutrition education would reduce poverty and improve household food security . Financial services alone were not enough. Health and nutrition education were not enough. You had to provide both to support household’s agency and decision-making regarding more and healthier food consumption. Fast forward to today, not much has changed. While we’ve celebrated reductions in global hunger in the past few years, it is again on the rise due to climate change and shocks, conflict, land degradation, to name a few. With support from CGAP several years ago, my colleague Megan Gash and I had the coolest opportunity to just study the concept of ‘resilience’ and its relationship to financial services . For an entire year, we conducted a series of frequent surveys with approximately 40 households in Burkina Faso. We studied their food security, their exposure to shocks, and how they coped with these shocks. In a CGAP blog , we outlined some of the findings that struck us, and sometimes that shook us to the core. At times, the entire cohort was food insecure. Fifty percent (50%) of them reported that they had gone hungry to make a loan payment or a savings group contribution. We wrote: “ When shocks occur, many households use negative coping mechanisms that increase food insecurity, such as reducing daily food consumption and selling grain stocks, which solve an immediate problem but can have long-term consequences .” When we gifted our survey participants a bag of rice for their continued participation in our research, they noted in a subsequent survey that this was a “positive surprise” and shared that this bag of rice ensured they didn’t go hungry that week. An unintended—but positive—consequence of our research. This experience in Burkina Faso has spurred our continued interest in the unintended consequences of our work in financial services. Years ago, I remember being at a conference and participating in a group discussing client protection and the concept of unacceptable sacrifices came up, but this was directly related to the concept of measuring over-indebtedness. But the experience in Burkina Faso taught us that households make unacceptable sacrifices to make loan payments, savings group contributions and to engage in economic activities. More recently, we’ve studied the tradeoffs made by households that can result in child labor or the stresses that can result in gender-based violence . When I think about the relationship between financial services, food security and nutrition, I think there are actions we’re likely already taking and some areas where we can be more creative. First, we have a responsibility to understand and mitigate the use of sacrifices when people use our financial services. But we have to expand our definition of ‘do no harm’ to go beyond over-indebtedness. We have to study the sacrifices people make using our products when we conduct market research, client satisfaction studies and outcomes/impact studies. If we do not ask the questions, we do not have the data nor the understanding of what is occurring and therefore, we’re doing nothing to mitigate this harm. In our research on child labor, we developed survey questions to help us understand the sacrifices households might be making (See the Impact Survey in the Monitoring and Evaluation Guide, Section J.) Second, we can ensure that we’re aligning the designs of products on common cash-flow and seasonal constraints, providing refinancing options so that households can manage debt when a shock occurs, and ensuring households have a portfolio of services that address income growth, consumption, and risk mitigation. All of these play a role in preventing households from using unacceptable coping mechanisms, such as reducing food consumption and choosing less nutritious foods. Third, we have to pay attention to gender and social norms. While we’ve measured food security at the household level, we’ve also tested what happens when you ask a woman the same questions, but about herself. A woman often ‘eats last and the least’, forgoing food for her husband, family elders, and her children. While research has often shown a woman will prioritise food security when she earns her own income, she still may have limited agency and must negotiate with others within her household for money to purchase food. Finally, some financial institutions have a history of providing health and nutrition education. Others teach their clients new agricultural and food preservation techniques. Not every financial institution has to provide food security and nutrition support directly but can do so through partnership. But these cannot be one-off, periodic activities that make headlines. They have to be thoughtful, long-term partnerships designed to make food systems work better and that provide vulnerable clients holistic services. In summary, I don’t think the financial sector has to necessarily create something brand new. While it’s not sexy to make iterative improvements, sometimes this is what is most needed and could be the most impactful and responsible. Food security should be considered as part of the design of financial services, and not simply seen as an outcome. We have a duty to account for the opportunity costs of a family’s food resources. Use of financial services should not come at the cost of a household not eating or making other intolerable sacrifices. Photo credits: Grameen Foundation About the Author: Bobbi Gray is Senior Research Director at Grameen Foundation USA. She has more than 18 years of experience in designing, implementing and coordinating research and evaluation on financial, health and agricultural programs for underserved communities across Latin America, Southeast Asia and Africa. Much of her recent research and programmatic experiences include understanding the barriers and opportunities to women’s economic empowerment and developing programmatic and evaluation tools for the same as well as studying the unintended impacts of women’s economic empowerment initiatives on the lives of women and their families. Bobbi holds a Master of Public Administration degree in International Management from the Middlebury Institute of International Studies at Monterey and a B.A. in French and Spanish from Texas Tech University.

Author: Swati M. Dhawan. On World Refugee Day, we are happy to share with you the first in our series of guest blogs dedicated to the financial inclusion of refugees and forcibly displaced persons. We have invited Swati M. Dhawan to curate this series. In this first instalment, she presents the ‘Finance in Displacement' research collaboration to outline the particular barriers that refugees and displaced persons face. Between 2019 and 2021, I had the privilege of being part of the Finance in Displacement project, a research collaboration that studied the financial lives of refugees in Jordan, Kenya, Mexico, and Uganda. Our initial objective was to explore the role of financial services in supporting the economic integration of refugees. However, as we delved deeper, we discovered that the lack of financial services was not the primary concern for refugees. Instead, they faced foundational exclusion due to limited economic rights (to move and work freely, obtain IDs and other important documents, and start a business) and faced significant challenges in envisioning a stable future in their host countries. This realisation prompted us to shift our focus from financial inclusion to the broader lens of financial health . During our research, we conducted extensive interviews, field observations, and focus groups. In the two case study countries, Jordan and Kenya , we conducted three rounds of repeat interviews with the participants, allowing us to delve deeper and observe their financial strategies over time. We also interviewed key stakeholders to understand the policy and service ecosystem for refugees. In the first interview round in Jordan when we asked refugees about their access to bank accounts and formal credit, we were often met with ironic laughter and scepticism. Unable to secure an income, our participants in Jordan did not see the value of a bank account. Only a small fraction (eight out of forty-four) who had managed to find formal jobs, at least temporarily, needed a bank account to receive a salary and could provide the required documents such as valid passports and work permits. Payments through digital channels offered some benefits in refugees’ ability to secure humanitarian cash assistance or remittances from family, but the utility ended there. Starting a business with formal debt was not preferred given the uncertainty and challenges faced by refugee-owned businesses in Jordan. In Kenya, refugees are required to reside in camps and it is a criminal offense to travel outside of the camps without permission. Our respondents in Nairobi were unable to develop their livelihoods; they were denied work permits and faced constant harassment and discrimination. Those living in the camps felt trapped as they were not able to move and trade freely or leave the camp to build a new life as skilled professionals, in Kenya or abroad. They faced challenges in renewing their documents and issuing work permits. In both countries, refugees were unable to fully integrate into host economies unless they had a secure legal status such as a permanent residence or had acquired citizenship (by the process of naturalisation). This uncertainty discouraged refugee investment in long-term skills and assets, and led to limited self-reliance and prolonged dependence on charity. In such a scenario, there was no incentive for refugees to save or borrow money to invest. We discovered that access to financial services was just one aspect of the multifaceted challenges refugees encountered. What truly mattered were the non-financial inputs that enabled them to achieve economic autonomy and access to socioeconomic opportunities. We categorised these inputs into two levels: foundational inclusion , which focused on obtaining economic rights and stability, and meso-inclusion , which addressed access to opportunities for improved financial well-being. Financial inclusion policies and programmes can then build upon this by providing refugees with access to tools to better manage their financial lives. We define a refugee to be financially healthy when over four to five years starting from their arrival in the host country, they can build daily systems to achieve the following outcomes (adapted from the financial health definition and indicators based on research by the Financial Health Network and Center for Financial Inclusion): 1. Meet basic needs: Refugees can meet basic needs when they can access resources—whether on their own or through their personal, social, and professional networks—needed to secure essentials such as food, shelter, clothing, medicine, and education. 2. Comfortably manage debt: Refugees arrive indebted to those who financed their journey and often take out lines of credit during protracted displacement to make ends meet, pay for unexpected expenses, or make lump sum investments. Some debt is manageable, but too much can leave individuals and households vulnerable to violence, extortion, and poor mental health. 3.Recover from financial setbacks : Financial setbacks such as loss of employment, a medical emergency, or a lost asset are common during prolonged displacement. These may be overcome through access to resources, whether lump sum aid disbursements, personal savings, or lines of credit through personal and social networks. 4. Access a lump sum to enable investment in assets and opportunities: Many refugees arrive with few assets and little savings with only small funds available to cover the day-to-day cost of living. If unable to accumulate or borrow a lump sum, refugees cannot build wealth or invest in ways that provide long-term security such as education and improved housing, or high-cost assets such as a car. 5. Continually expand their planning horizons: Over time, new arrivals should be able to move from daily ‘hand-to-mouth’ struggles to a place where they can expand their economic activities and achieve some stability. This will allow them to contemplate, and plan for, a financial future beyond the present day. Applying the financial health lens to our findings in Jordan and Kenya, we found that while financial inclusion might not always improve financial health, a financially healthy refugee is more likely to engage with financial services. While well-intended, the efforts of the financial inclusion actors to improve refugees’ access to financial services—by removing operational barriers or improving financial literacy—are not likely to bring transformative changes to their financial health in a scenario where foundational economic rights are not guaranteed. In Jordan, since refugees face barriers in accessing mainstream banking infrastructure due to lofty documentation requirements, they are enabled to access mobile money which is not yet mainstream and robust. Moreover, only Syrian refugees have the required IDs (a card issued by the Ministry of Interior) to open a mobile wallet, and refugees from other nationalities are still required to provide valid passports which most do not have. In Kenya, refugees are not allowed to use M-Pesa which is a critical part of the economic infrastructure. Instead, their transactions are limited to a separate limited-function financial system called Bamba Chakula. Rather than enabling financial inclusion, we argue that such efforts have contributed towards the ‘ financial encampment ’ of refugees. Our observations corroborate the criticism of the self-reliance model in humanitarian programming, characterized by a refugee support system that is driven by market forces, neoliberal principles, and financialization. As displacement is prolonged, humanitarianism has taken a resilience spin , placing the responsibility on national and local authorities to provide services and highlighting the involvement of non-traditional actors like the private sector, and portraying aid recipients as 'active and resilient survivors and first responders.' These approaches, while avoiding political conflicts and creating private sector markets, lack transformative impact on refugees' conditions and may undermine autonomous humanitarian efforts. While we cast a critical eye on the efficacy of financial inclusion approaches, we acknowledge that it is not the question of ‘financial inclusion versus financial health’ but rather an integration of both . Financial inclusion remains crucial for refugees' prolonged stay in host countries. However, to create meaningful change, financial inclusion policies must align with host government policies that enable foundational and meso-level inclusion. Adopting the financial health approach offers fresh insights for designing effective initiatives by prioritising the needs and desired outcomes of refugees. This requires collaboration among multiple stakeholders and necessitates political solutions to address systemic barriers. For a deeper dive into some of the challenges refugees face, we also recommend looking at the selected financial biographies from Jordan and Kenya , bringing some of the participants’ stories to life. Also find more reports, essays, and financial biographies of refugees and migrants from across the globe on the Journeys Project website. Illustrations by Liyou Zewide. See Dhawan, S. M., & Zademach, H.-M. (Eds.). (2021). A Hope for Home: A Brief Compendium of Financial Journeys of Refugees and Asylum Seekers in Jordan . About the Author: Swati M. Dhawanti is a seasoned development researcher with 14 years of experience advising businesses, international development organizations, and governments on achieving inclusive development through digital pathways. Her expertise lies in the areas of digital financial inclusion, financial capability, women's economic empowerment, digital livelihoods, and consumer protection. With a global and sectoral focus, Swati has conducted research across developing market economies in Asia and Africa. Notably, Swati's recent research has delved into the financial and livelihood transitions of refugees, exploring the pivotal role of digital financial inclusion. This research formed the basis of her recently completed Ph.D. in Economic Geography. She has also conducted independent research in Germany as a German Chancellor Fellow. Her research contributions have been widely published in various formats, including academic papers, reports, essays, blogs, and articles.

Author: Hans Ramm. In the latest of our guest blogs on the topic of the European Microfinance Award 2023 – Inclusive Finance for Food Security & Nutrition – Hans Ramm discusses the key global threats to food security and nutrition – and five ways – including with practical examples – that they can be addressed. The problem The UN Food Systems Summit, held during the UN General Assembly in New York in September 2021, set the stage for global food systems transformation to achieve the Sustainable Development Goals by 2030. The meeting brought to the attention of national governments, development actors, food and non-food companies and investors, and civic sector actors the following three accelerating - and closely interconnected - global threats: 1. In 2021, 768 million people suffered from hunger - and 2.3 billion were food insecure. 2. Food production alone contributes to 25% of global CO2 emissions and the food demand value chains, including food processing and trading, make up 36%. 3. In 2020, 3.1 billion people could not afford a healthy diet. 40% of adults and 20% of children globally suffer from obesity and diet-related non-communicable diseases. And deaths attributable to poor diets have grown by 15% since 2010. What does this mean? It means that food availability is not keeping up with population growth, although access to affordable food remains the still greater challenge due to accelerating poverty levels even in higher-income countries. Unhealthy diets – driven in part by the proliferation from the US fast food industry - will take long to reverse. The repercussions of the pandemic, political conflicts (like the Russian war in Ukraine) and more frequent and intense droughts and floods triggered by climate change further undermine the stability of the already unstainable food systems. Of course, the most vulnerable populations are threatened the most. The sustainable agriculture NGO Farming First identifies extreme gender disparities in access to key agricultural resources, particularly in Sub-Saharan Africa, relating to land (15%), inputs (<10%), extension services (5%), assets, markets, decision-making authority, and income. Five ways forward The Food Summit triggered five major action tracks (broken down by multiple workstreams and solutions) and pledging of enormous financial resources by public and private actors. However, many actions initiated by the UN and multilateral organisations in their ‘top-down’ and supply-driven operational modus vivendi will be unlikely to facilitate effective and systemic changes of food markets. To avoid too much supply-driven activism, I believe there should be a focus on the following five market demand-driven and fiscal strategies to address the three main food security & nutrition threats outlined above, and I refer as examples to five promising blended finance case examples and a ‘true’ cost food study: 1. Internalisation of environmental and health costs of food production and consumption to be enforced by fiscal measures: Tax levies (as applied for cigarettes and alcohol) should be applied to environmentally damaging agri-chemicals so that the demand by food producers increases for comparatively ‘cheaper’ organic fertilisers and pesticides. This, in turn, encourages agricultural input suppliers to switch towards organic products. The value-added taxes on food products need to compensate for the environmental and health costs of particular food items to encourage consumers to switch towards healthy food items, including subsidies for healthy food. This requires that the societal (or ‘true’) costs of food items are measured and then followed by fiscal measures targeted at the global food and beverage industries and their strong lobbies to reduce, for example, the high sugar content of their products. Stronger awareness building of governments in the aftermath of the Food Summit may finally overcome their decades-long food policy failure of higher taxes on sugar-prone food and beverages, despite a proven positive correlation between diabetes, cardiac diseases, dementia, etc and sugar intake. A recent ‘true cost’ food study in Switzerland revealed that average food costs should be 90% higher than current market prices to internalise environmental (CO2 emissions, water pollution & use, biodiversity loss, etc) and health (diet-related non-communicable diseases) costs. Here are some examples of market versus ‘true’ costs for four selected food items per kg/l: Market cost ‘True’ cost Beef: 23.00 51.60 Chicken: 13.90 19.10 Milk: 1.50 0.80 Apples: 3.70 -2.90 2. Agricultural investors incorporating key ESG risks of their investees into their investment pricing: This requires analysis (similar to ‘true’ costing) on how specific agricultural inputs affect the quality of produce, the resilience of crops against adverse weather events, soil fertility, etc. of their investees and local communities. This would cause a shift of investments towards more sustainable food production. Indeed, Rabobank, the global triple bottom-line agricultural investment leader, has developed ESG risk scorecards for different typologies of agricultural production since the mid-2000s for incorporation into its investment pricing. 3. Strengthening the market positioning of smallholder farms within their agricultural value chains through ‘win-win’ partnerships with farmer organisations, value chain actors (input suppliers, processors, traders), and financial intermediaries, while supporting their transition to agro-ecological practices, are effective solutions to contribute to food security while reducing the negative environmental footprint. More than 500 million smallholder farms produce over 70% of global food and 90% of food in Sub-Saharan Africa. Inclusive growth of smallholder farming and agri-businesses also provides productive rural jobs and income - and is 2-3 times more effective in reducing poverty than growth in any other sector. There are promising blended-finance funder approaches with strong gender strategies to de-risk and deepen the ESG outcomes of investments by private smallholder agricultural impact investors. Examples include: Smallholder Safety Net Up-scaling Programme (SSNUP) is a multi-donor blended smallholder finance initiative, aims at sustainably strengthening resilience and the safety nets of ten million smallholder households over ten years. It is co-funding technical assistance for farmer organisations, agri-businesses, and financial intermediaries (being investees of the nine private agricultural impact investor partners) to: (i) develop/improve their financial and advisory services to smallholder clients; (ii) enhance market building linkages among agricultural value chain actors, including digitalisation of communication and business transactions; and (iii) upgrade their internal management and ESG performance. Aceli Africa is a multi-donor funded market-led platform offering first-loss financial incentives, social impact bonuses and technical assistance to local agricultural lenders and global impact investors. It thus reduces the “missing middle” by catalysing finance for credit-constrained agri-businesses along selected agricultural value chains that offer the best potential for income and job creation, food security and nutrition, gender and youth inclusiveness, and promotion of climate-smart and smallholder agriculture in Eastern Africa. Nutritious Foods Financing Facility is an innovative up-and-coming blended finance nutrition initiative, where GAIN facilitates more enabling environments for nutritious food and Incofin offers funding and technical assistance for businesses that support the supply of nutritious, safe food for domestic, low-income markets in Sub-Saharan Africa. It aims at four priorities: (1) increased access to nutritious food through wider distribution, improved affordability, variety, and desirability; (2) increased supply of nutrients and reduced harmful elements through improved reformulation; (3) increased food safety and reduced contamination during production; and (4) decreased food loss during production. 4. Facilitating digital transaction channels between smallholder farms and consumers to ensure direct market access and 'fair' prices. Whereas family farms are exploited by cartels of wholesalers and retail discounters in higher-income markets, they lose up to 40% of their harvest due to lacking storage/warehousing facilities and suffer from limited market access due to poor infrastructure in low-income countries. Two examples from Europe and Eastern Africa demonstrate this: Crowdfarming is a digital platform which provides logistics and customer service so that European farmers can sell their crops directly to the end-consumer. This cuts out the middlemen who control the market and pay the farmers prices that do often not even cover production costs. Crowdfarming fights against the 11% food waste at the source (crops not been harvested or not meeting optical standards of traditional market demands) thanks to crop adoption by the consumer. Pre-financing by consumers offers regular cash-flow to the farmers enabling them to invest in organic production while employing staff around the year at fair conditions. Apollo Agriculture is a digital platform which seeks to “redefine investment opportunities for farmers” in Eastern Africa by providing financing for better products, increasing their harvest, and turning their subsistence farming into commercial farming. Farmers can buy inputs in cash or credit by choosing from Apollo’s digital store and then picking it up at the closest of the more than one thousand agri-dealers. Credits are linked with drought/flood insurance coverage. Apollo offers agricultural training to all clients. 5. Stimulating demand for affordable nutritious food as demand creates its supply . This encompasses multiple initiatives from school gardening and feeding programmes, food stamp programmes up to including health & nutrition in the primary and secondary school curricula. It is equally relevant in the South and North. The five strategies outlined above follow simple economic logic that market demand creates its supply (not the other way round) and that government has to ensure that all food production costs are internalised to protect the public (and ultimately the planet) against environmental destruction and mounting health costs. However, there are three broad challenges to the pursuit of these strategies: Firstly, development actors still have little expertise and incentives in leveraging the knowledge and resources of the private sector through smart public-private partnerships to contribute to the Development Agenda 2030. Secondly, politicians show limited commitment beyond their next elections to address global food and nutrition threats and thus do not push sufficiently for regulatory/fiscal changes against strong lobbies from the global food and beverage industries. And thirdly, humans stick to old food habits even if they become fully aware of their negative health and environmental consequences and even if they have to pay more for them. Addressing these challenges will be critical in supporting the strategies to improve food security and nutrition. Photo source: SDC About the Author: Hans Ramm is a practitioner in financial inclusion and a SPI social auditor of financial institutions. He holds tertiary degrees in economics and political science and a post-graduate diploma in development co-operation. He has worked in more than 30 countries for various development organisations like the UN, bilateral agencies, development banks, consultancy companies, inclusive banks and microfinance institutions, and INGOs.

Author: Ayako Iba. In the latest in our guest blogs on the topic of the European Microfinance Award 2023 – Inclusive Finance for Food Security & Nutrition – Ayako Iba from the UN World Food Programme discusses the global food crisis and the role cash transfers can play in addressing access to food, while promoting financial inclusion at the same time. At the backdrop of a global food crisis , triggered by the effects of economic shocks, climate crises, and conflicts, the link between food security and financial inclusion has become ever more evident. In 2023, over 345 million people – more than double the number in 2020 – are facing high levels of food insecurity, amid soaring food prices and the ripple effects of cumulative economic shocks at the national and global level. By November 2022, the Horn of Africa had suffered four failed rainy seasons, over 1.4 million people in Somalia alone were displaced, and 66% of them due to drought. Halima Abdulle Samatar and her four children fled to a camp for internally displaced people (IDPs) in Dolow, after their family crops withered and 60 goats died. With the cash transfers Halima received from the World Food Programme (WFP), in addition to food, she paid for schoolbooks for her children and medication. Initially, she also saved $5-$10 per month to build a shelter, because they were sleeping in the open. Soon after, by continuing to save and buying goods on credit from a local wholesaler, Halima opened a small shop, made of corrugated iron sheets and wood, to sell batteries, pens, and groceries in the IDP camp. Cash transfers (also referred to as cash-based transfers ) are cash assistance provided to the people who need it the most in the form of direct payments, which can come in many forms and from different entities. For example, WFP prioritises sending unrestricted cash transfers and avoids imposing conditions, in order to maximise the contribution of cash to meeting people’s needs and transforming their lives, particularly in the context of humanitarian emergencies. Other development organisations might focus on cash transfer programmes that are conditional to specific actions, such as attending a farm-management training. It can also be restricted to buying food items or making only cashless payments, depending on the programmatic objective. Several governments use cash transfers as a large-scale social protection programme as well. The funds can be transferred to bank accounts, electronic money accounts such as mobile money wallets, or distributed in the form of a voucher, prepaid card, or cash. WFP, The largest provider of cash transfers The UN World Food Programme (WFP) , the world’s largest humanitarian organisation, is taking the lead in tackling Sustainable Development Goal (SDG) 2, by seeking to end hunger, achieving food security, and improving nutrition by 2030. Cash transfers for WFP have proven to be an effective tool to tackle the important intersection between this SDG on Zero Hunger and financial inclusion, because as the case of Halima demonstrates, cash transfers enable people to take control over their essential needs, including food security and nutrition, and, at the same time, build financial resilience.  In 2022, WFP spent a third of its total budget in cash transfers, by distributing almost 3.3 billion dollars to 56 million people across 72 countries. WFP prioritises unconditional and unrestricted cash transfers, because its aim is to empower people with the choice to address their essential needs in local markets , while also helping to boost local economies. It also uses conditionality as part of programmes that are inherently conditional, such as school-based or resilience programmes. Most importantly, WFP designs cash transfer programmes in a way that the experience of people receiving the cash is the most dignified. That being said, WFP would not be able to deploy such a scale and volume of cash transfer programmes without forming strategic business partnerships with financial service providers (FSPs), NGOs, governments and retailers, which also play critical roles in implementing risk mitigation measures that ensure that the money WFP sends reaches the right people. For example, WFP had contracts with more than 109 FSPs as of end-2022, ranging from banks, mobile money operators, microfinance institutions, remittance service providers, amongst others including fintech companies. In addition to the WFP assurance framework, WFP benefits from FSPs’ expertise for transferring funds in a secure, traceable manner, and in compliance with local regulation. At the same time, the FSPs’ resources - such as staff, agents, and IT systems - help WFP maintain its wide outreach, by assisting people most in need, taking into account their needs and preferences, as well as the geographical area and the existing infrastructure. Cash transfers for essential needs and financial inclusion As the recently published WFP Cash Policy illustrates, cash transfers can contribute to addressing people’s essential needs while supporting to build their financial resilience in multiple ways:       Unrestricted cash operations can help reduce the difficult trade-offs people face when deciding which of their urgent needs to prioritise. Evidence shows that 60-70% of income for vulnerable households is spent on food. It can also help avoid that people are forced to resort to coping mechanisms that cause serious harm to their physical or mental well-being, such as young girls marrying, sex work, or undermining their ability to bounce back from crises, for example, by selling their productive assets.     People receiving cash transfers to support their essential needs will often be introduced to formal financial services for the first time , when they are requested to open bank accounts or mobile money wallets. Financial literacy trainings are offered when assisting people to register with the FSPs, for example, on the importance of keeping their PIN code confidential and how to submit complaints.Also, opening accounts in the name of women on behalf of their households can be a gateway to women’s empowerment , by counterbalancing the existing gender inequality, not only in terms of access to financial services, but economic opportunities in overall. The people we assist have to make financial decisions to better respond to shocks and often have pre-existing financial obligations . For instance, they might need to invest in fertiliser or crop storage to improve their food security situation. In such cases, most people have financial services of their preference that they rely on, whether they are saving groups, remittances, or informal lending. However, reliance on unstable or informal financial services often translates to limited access to adequate and cost-efficient payment services, insurance, or credit, which can help to seize economic opportunities or cope with sudden drop in income or unexpected expenses. Thus, cash transfer programmes should be designed to facilitate the transition to formal financial services, while taking into account the channels that the people are already familiar with.         Cash transfers create a positive spillover effect for the local economy . In a programme evaluation WFP conducted in Kenya, it was reported that, after deploying cash transfers, the monthly sales volume of local traders increased by 94%. In a similar evaluation in Lebanon, it was observed that a multiplier of 1.51 dollars was generated in the local economy for every dollar of cash transfers. Hence, providing cash transfers can help to boost demand for local goods and since it is commonly denominated in local currency, it can also curb local currency devaluation .      That being said, WFP commits to using the modality or combination of modalities (cash, value vouchers, commodity vouchers, in-kind food, capacity strengthening) that best addresses the people’s essential needs. Each context is different, and every household has specific needs and strategies for navigating through crisis and hunger. Through thorough assessments, including feedback from food-insecure people, WFP identifies the modality that is the safest and most likely to achieve the best outcomes for them. For example, where food is not available and markets are unlikely to respond to greater demand because commercial supply chains are seriously disrupted, or where people prefer other modes, WFP uses in-kind food or a combination of modalities. In all, well-designed cash transfers can give people their agency back and, crucially, their right to choose. The key to success is to design cash transfer programmes with a people-centred approach, by tailoring the transfers to their needs and enabling them to receive cash on an account in their name, so that they are better able to resist to shocks and build their financial resilience. In this way, cash transfer programmes can effectively and efficiently support people to meet their essential needs, while helping to break the vicious cycle of poverty and vulnerability and also boost local economies. About the Author: Ayako Iba is a Financial Services Specialist at the World Food Programme. Her focus is on monitoring WFP’s exposure to counterparty and operational risks of contracting FSPs for cash transfer programmes, by overseeing due diligence exercises and proposing risk mitigation measures. She has over ten years of experience in the financial inclusion sector, having worked for a microfinance institution in Mexico, evaluated financial literacy and client protection programmes of the World Bank, and assessed financial and social performance of over 70 FSPs worldwide. Ayako holds a MSc in Local Economic Development and a BSc in Sociology from the London School of Economics.

Author: Michaël de Groot. In the latest in our guest blogs on the topic of the European Microfinance Award 2023 – Inclusive Finance for Food Security & Nutrition – Michaël de Groot from Rabo Foundation shares how three of the foundation’s partners are working to build more sustainable and resilient food systems by tackling challenges across the food value chain. Farmers, both small and large produce enough food to feed 1.5x the global population. Despite this, 850 million people are hungry, and many of the world’s 450 million smallholders have to live on less than $2 per day. Add to that the significant role of our current food system in driving climate change, and we have a situation that we can’t sustain. Staple crops like rice, wheat and potatoes are already experiencing impacts from climate change. But so are cash crops. One of Rabo Foundation's partners, Norandino in Piura, Peru, has had to switch its cultivation three times over the past 15 years – from coffee to cocoa to sugarcane. Three different crops in 15 years, each time moving to crops more resistant to heat, drought and disease.  To improve the climate resilience of farmers who grow our food, on-farm agriculture practices are important. But it is only one part of the change that’s needed. Farming households cannot change their crops and their agricultural practices, let alone invest in technology if they don’t have a living income. This is especially true for smallholder farmers that live at or below the poverty line, yet who produce 30% of the food consumed by increasingly urbanized communities.   What we need to support and create is a food system change that responds to farmers’ needs and incorporates agricultural inputs, services, training, and access to markets. And the system change approach must not be limited to the institutional perspective, but must also tackle the way we produce – more regenerative, more circular, less external. Moreover, it must incorporate the entire value chain and not only a single solution. The following three examples show how to create a food system change. Sokofresh Cold Storage Kenya Africa In many countries, the mismatch between supply and demand is due to lack of infrastructure and absence of know-how that helps keep food fresh longer. A large part of that is the lack of access to affordable technology.  SokoFresh  - a company from impact venture company Enviu – has developed a process and business model that gives smallholder farmers affordable access to cold storage and links them to markets. Sokofresh manages off-grid, mobile cold storage units that are strategically placed at the farm-level to optimize aggregation from smallholders. Farmers, cooperatives and aggregators are linked to exporters, wholesalers and processors. The use of cold storage during aggregation has two effects: drastically reducing food loss during harvest and significantly reducing the transport costs from farm to off-taker. Through the margins gained in this process, SokoFresh can be paid on a per kg basis, and farmers can earn up to 50% more on their harvest, while buyers receive more and better-quality produce. Rabo Foundation was one of the first partners to recognize the value of this concept and invest in the SokoFresh pilot to increase the accessibility of cold storage. SokoFresh is just one of Enviu’s innovations that drive systemic change to address environmental and human issues we are facing today. Their FoodFlow program is creating a value chain for french beans, mangos, and avocados by developing the technology needed to eliminate post-harvest losses and create a value chain made up of sustainable, circular business models, achieving 0% post-harvest loss, increasing incomes and improving food security. Its ambition is to deploy 400 cold storage solutions over the next 5 years, leading to increased income for 35,000 farmers, 3,000 new jobs in rural areas and 37,500 MT CO2-equivalent emissions prevented annually. We are currently scaling up our cold storage capacity in Kenya. Furthermore, we’ve started to develop a farmer-centric market linkage platform to provide smallholders with greater choice of buyers to sell to. Indonesian Farmers Produce Biodiversity and Premium Rice Smallholder rice farmers in Indonesia often experience low productivity due to excessive use of synthetic pesticides. The agtech firm Pandawa Agri has developed an innovative reductant to help farmers reduce their overall pesticide use, resulting in better harvests, safer working conditions, improved biodiversity and a better life for the farmers. And with Rabo Foundation, Pandawa Agri also expands access to finance, markets, and farming inputs needed by smallholder rice farmers. Less dependent on pesticides ‘Pandawa Agri developed an organic pesticides reductant – the first of its because we wanted to help smallholder farmers’, recalls co-founder Kukuh Roxa. ‘Farmers often experienced failed harvests because they used too much synthetic pesticide. We wanted to make them less dependent on those kinds of chemicals, improve their harvests, while also staying healthier and putting less pressure on the environment –lowering costs along the way.’ The reduction in pesticides alone isn’t enough. To have a successful harvest and a good income, farmers also need good seeds and other inputs, Pandawa trains the farmers to use less water and fewer pesticides. The rice is now of very high quality to ensure that farmers can sell their premium rice for a good price, without intermediaries taking all the profit. Innovative Financing Rabo Foundation partners with Pandawa Agri in the following ways: long-term working capital loan  which Pandawa Agri uses to provide access to financing for smallholder farmers. Pandawa Agri assumes the risk for these loans. working capital loan  for Pandawa Agri to purchase the rice from farmers to then distribute it to buyers. Rabo Foundation also connected Pandawa Agri to ACA Insurance. Their  agriculture micro-insurance coverage  protects farmers from the financial risks of a failed harvest. Climate Smart Agriculture One-stop Shop Enhances the Output and Life of Indian Farmers Be it rice, peas, eggplants or bananas, Indian Agtech company DeHaat ensures a swift journey from field to shopping basket. They use an app and an enormous local distribution network for farmers in central, northern and western India to achieve this. In addition, DeHaat provides agricultural products and advice, as well as food storage and distribution channels. Through thousands of outlets produce from farmers reaches consumers incredibly quickly. Millions of Indian smallholder farmers pay intermediaries high fees to sell their produce. That is, if it doesn't perish on the way to market, where it often fetches a low price anyway. With their app and a local network of more than 11,000 DeHaat Centers, the company creates a direct link between farmers and buyers. The app provides crucial information on the latest market prices and puts farmers in contact with buyers, to whom they can sell directly at a fair price. They subsequently deliver their harvest to a DeHaat Center, where they immediately collect payment. Currently DeHaat serves around 1.8 million farmers across 118,000 villages in India. DeHaat Centers are managed by franchise operators from the local community. They supply agricultural input products and training is offered physically as well as digitally to properly educate farmers by DeHaat agronomists.  DeHaat Centre provides also temporary storage for farm produce sold.  The DeHaat app also gives farmers important forecasts and advice – for instance, by calculating expected harvest yields and the expected demand for produce, as well as providing weather reports and warnings about crop diseases. In addition, DeHaat agronomy experts visit farms to collect data and provide farmers with customized training, based on local soil samples and historical cropping patterns. DeHaat then analyzes the soil samples in order to offer tailored advice on soil fertilization. The final step in the system, the storage and efficient market linkage of the harvest that has been sold, is also transparently managed. Post-harvest loss is significantly reduced thanks to local storage, reliable transportation to regional warehouses and demand led aggregation. Here, millet is collected for transportation. And in the DeHaat warehouse in Kasgani (Uttar Pradesh), rice lies safely and dry ready for buyers to supply to consumers. Photos: Rabo Foundation. About the Author: Michaël de Groot is senior investment manager for Rabo Rural Fund.