Making Microfinance More Effective

Harvard Business Review

Personal savings, insurance, credit, cash transfers from family and friends and other financing mechanisms offer promising opportunities to create security and steady employment but they require a nuanced understanding of product design and the local market conditions in order to be effective. The Grameen model of microfinance gained a great deal of attention in the international development field after early data showed that it was associated with high repayment and low default.

Under Fire, Microfinance Faces Falling Out of Favor

Harvard Business Review

Microfinance has come under fire in the past 18 months, triggered in part by SKS Microfinance's IPO. Critics complain that the institutions supporting microfinance have become too greedy, and many are using this as an argument to deeply regulate or, even more, cut support to microfinance operations. Dr. Muhammad Yunus introduced the concept of microfinance in 1983; in 2006, he won the Nobel Prize for his pioneering efforts. Such is the power of microfinance.

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Why CEOs have Liberal Arts Degrees

Mills Scofield

A career advisor once told me that those who pursue liberal arts majors and enter finance, consulting or technology are not the exceptions. She is now the core programming director for the Brown Entrepreneurship Program and Head of Design for The Intercollegiate Finance Journal.

CEO 73

The Microfinance Contagion Scenario

Harvard Business Review

So far, the Andhra Pradesh (AP) microfinance crisis has largely been viewed as a local issue, with relatively little impact beyond AP or India's borders. Other microfinance crises, in Bolivia, Nicaragua, Nigeria, and Bosnia, have not spread beyond the borders of a particular country. In a recent paper, Jonathan Morduch and Jonathan Conning explain the role of debt and equity financing in the microfinance industry.

How Large NGOs Are Using Data to Transform Themselves

Harvard Business Review

and globally, and Habitat for Humanity, which works in 70-plus nations to provide home construction, rehabilitation, and increased access to shelter and financing, gathered data from their sites to make the case for profound change.

3 Things Driving Entrepreneurial Growth in Africa

Harvard Business Review

Firms are realizing what microfinance has known for a while: Local self-policing groups, or village headmen who police honor codes, can hedge cash flows in far-flung places. In Kenya six would-be bikers jointly enter Toyota’s Crux Finance scheme, pay down Sh8,000 ($94) each, and start riding for as little as Sh355 ($4.20) a day, often as boda boda taxis.

Scaling Up Without Losing Your Edge

Harvard Business Review

Following Abed's twist on Schumacher — "small may be beautiful, but big is necessary" — it now touches the lives of an estimated 126 million people with healthcare, education, enterprise development, microfinance and a slew of other programs. Forty years ago, British economist E.F.

Making Sense of the Many Kinds of Impact Investing

Harvard Business Review

Currently, impact can mean anything from venture investments in new health technologies to microfinance loans in Peru; from affordable housing in the US to renewable energy in India; from social impact bonds to private equity funds that create jobs.

Entrepreneurs: You're More Important Than Your Business Plan

Harvard Business Review

As Amar Bhide said in " Bootstrap Finance: The Art of Start-ups " (a 20-year-old HBR article that is an uncanny precursor to today's "lean startup" meme), traditional business planning processes are less relevant to bootstrappers — where resilience trumps planning and energy trumps experience.

Why CEOs have Liberal Arts Degrees

Mills Scofield

A career advisor once told me that those who pursue liberal arts majors and enter finance, consulting or technology are not the exceptions. She is now the core programming director for the Brown Entrepreneurship Program and Head of Design for The Intercollegiate Finance Journal.

Funders Can Give More than Money

Harvard Business Review

Six years ago, David and Donna Allman approached Opportunity with an idea that fell outside our traditional microfinance model: to build a Community Economic Development (CED) program in Nicaragua. It called for leveraging the profits of the global microfinance institution, and coupling them with private investments from the Allmans and their donor network. We know that microfinance alone will not break the poverty cycle. Finance Innovation Nonprofit CED

Global Entrepreneurs Need New Funding Models

Harvard Business Review

In low-income countries, according to World Bank data in a recent paper by the consultancy Dalberg, 43% of businesses with between 20 and 99 employees say that access to finance is a major constraint. The White House has called this gap between the demand and supply of finance for small and medium enterprises a "market failure.[and] For now, my business is much better, but it all boils down to finance.". Entrepreneurship Finance Global business SEIFF

Using Games to Get a Handle on Bank Risk

Harvard Business Review

Yet unlike in finance, where distributing risk across institutions is the goal, in drug development the focus is on isolating risk. The success of platforms like Mint.com suggests that there are large numbers of consumers who would like to have better control and tracking of their finances, but are waiting for simple and practical tools to do so. Finance Research Risk managementBank marketing materials focus on the dreams, anxieties and goals of consumers.

President Obama Can Make Start-Up America Succeed

Harvard Business Review

Entrepreneurship in financial services has been given a bad rap as one contributor to the economic crisis, but we desperately need innovative financing models for start-ups. We don't innovate in entrepreneurial finance enough in the U.S.: