With thanks to our sponsor

Uwimana Rose

Financial Inclusion for women and adolescent girls

The 1.1 billion unbanked women

Middle East, South Asia and Sub Saharan Africa will account for more than 70% of unbanked women by 2020 (CARE/Accenture, 2016)

East A

sia &

Pacific

*

Europe

& Cent

ral A

sia*

Latin A

merica

& Caribb

ean*

Middle

East*

South

Asia

Sub-Sah

aran A

frica*

0

50

100

150

200

250

300

350

400

261

82114

63

359

173

82

3857 60

236

154

2014 2020E

million

Olive

BEYOND SAVINGS: TOWARDS INCLUSIVE GROWTHJosefine Lindänge Gutman | Hand in Hand International London School of Economics | December 5th 2016

Rahabu Mukampenda | Shop Owner of Nyarubuye | Kirehe, Rwanda

@HiHInt #beyondsavings

How can you helpBeatrice Wanjiku | Yoghurt Maker | Nairobi, Kenya Hanna Haciku | Tailor | Nairobi, Kenya

Hand in Hand & CARE – what we set out to do

• Three-year, US $3m partnership

• Graft Hand in Hand’s business training on to CARE’s existing VSLAs (Savings Groups)

• Create 80,000 sustainable jobs in Eastern Province, Rwanda

• Increase incomes, savings and asset accumulation

• Improve financial knowledge, skills and confidence

• Increase skills to develop small businesses and income generating activities

@HiHInt #beyondsavings

The science

• In June 2016 the Swedish Development Advisers surveyed 530 randomly selected respondents from CARE VSLAs, representing:

– 430 respondents from the ‘Project Members’ of the Job Creation Project

– 100 respondents from the ‘Comparison Groups’ (CARE savings groups members, not included in the Job Creation Program and therefore not beneficiaries of the Hand in Hand business training)

@HiHInt #beyondsavings

How did we do?

130,000 members trained

115,000 jobs created/ enhanced

Women’s participation 80%

@HiHInt #beyondsavings

Job Creation

• Insert table here that shows the full time and part time workers hired by the project and comparison groups. A difference of 30 and 55% respectively

@HiHInt #beyondsavings@HiHInt #beyondsavings

How did the enterprises perform?

• Insert table which shows the net business income between project and comparison groups. 75% difference

Investments

• Insert table which shows how many nave invested in assets in the past 12 months and how much has been invested in assets

Financing

• Insert table which shows the effect on access to credit

@HiHInt #beyondsavings

Savings groups

Florida Mukaruge | Retailer | Rwanda

@HiHInt #beyondsavings

What next?http://www.handinhandinternational.org/interactive-infographic/

Florida Mukaruge | Retailer | Rwanda

Thank you

Josefine Lindänge GutmanCEO | Hand in Hand International T: + 44 207 514 5091E: jlindange@hihinternational.org

Connect with our people on LinkedIn

We hope to hear from you soon.

Thank you,Hand in Hand International

The Financial Inclusion Challenge –A Bankers´ Perspective

London, 5 December 2016

FinanzgruppeSparkassenstiftung für internationale Kooperation

1. 200 years of Sparkassen in Germany

2. How Banks earn Money

3. Financial Inclusion – or not

4. Project Example: Tanzania

Agenda

1. 200 years of Sparkassen in GermanySparkassen today: professional with a social mandate

Sparkassen are …• Banks …

- German Banking Act- Supervision by ECB- Full regulatory requirements for banks

• … with a Social Mandate- Defined in state laws and statutes- Objectives:

Provide financial services to all segments of the population, everywhere in the country (“account for everyone”)

Provide SMEs with loans and other services Promote local entrepreneurial activity Promote social and cultural development

Profitability is a necessary prerequisite for sustainable development

1124

30

50

Commerz-bank

Deutsche Bank &

Postbank

Cooperative banks

Number of customersin million

Market share of …in %

Number of …in million

403 Sparkassen (savings banks)

Others

Savingsdeposits

Loans to customers

Principal bank account

50 50 62 38 48 52

Savings accounts

Credit / debit card

Current account

55

52

45

*Germany‘s total population: 81 million

1. Sparkassen todayCore figures (group of 403 local banks)

page 24

Sources of Income

Fees and CommissionsInterest Margin Return on

Investments

2. How Banks Earn MoneySources of Income

Retail Banking …

Investment Banking …

2. How Banks Earn MoneyInterest Rates for Small Loans - Components

Cost of Funds

(if in Forex: incl. exchange rate risk)

Expected Profit ?

Operating Expense(e.g. staff, equipment,

rent, taxes)

Loan Losses

5 - 20 %(Ø 7.8 %)

2 - 20 %(Ø 3.6 %)

10 - 30 %(Ø 14,0 %)

(Ø 2.6 %)

influenced by …

type of institution

efficiency

professionalism

donors,savings business,lending currency,inflation rate …

components …typical range …

Data for developing countries as of 2011: (CGAP 2013, Rosenberg et.al.)

3. Financial Inclusion – or notChallenge 1: costs per loan

Challenge: most operational costs are fixed (e.g. salaries, rent, IT)

Result: higher costs for small loans (as percentage of loan amount)

higher interest rates for smaller loans !

Solution: reduce costs esp. for smaller loans !

- efficient workflows and procedures - economies of scale (e.g. more loans per credit officer) - standardized products (amounts, terms etc.) - reduced transaction costs (technology e.g. POS terminals) - outsourcing (e.g. cooperation with agents, NGOs and others)

3. Financial Inclusion – or notChallenge 2: non performing loans

Challenge: non performing loans are extremely expensive: follow-up costs + loss of loan + loss of expected income

Result: general rule for small loans: total costs = 2 * loan

amount

Solution: reduce risk of loan losses ! - standardized workflows and procedures - use of technology - training of staff - risk sharing agreements (e.g. with NGOs)

4. Project Example: TanzaniaTraining and Strengthening of MFIs, Financial Inclusion

Partners: Tanzania Association of MFIs (TAMFI), Tanzania Postal Bank (TPB) and Karagwe Rural Development and Environmental Conservation Agency (KARUDECA)

Objectives: Increase outreach of TPB, training of staff in MFIs and TPB,

professionalize MFIs in Tanzania, savings mobilisation,

business skills of micro-entrepreneurs

Results: - new TPB Training Center (for TPB and TAMFI)

- modernization/extension of TPB branches (incl. workflows)

- savings mobilization campaign (World Savings Day etc.)

- business simulation game for micro-entrepreneurs

Niclaus Bergmann, Managing DirectorPhone: 0049-228-9703 6615Email: Niclaus.Bergmann@SBFIC.de

If there are any further questions,do not hesitate to contact me.

Microfinance at Credit SuisseFinancial solutions to link the top with the base of the pyramid

December 2016

Laura Hemrika Global Head of Corporate Citizenship and Foundations

Our world todayEconomic wealth pyramid

31

Credit Suisse Leadership & Innovative Solutions to Link Top with BOP

32

TOP≥ $1m in financial assets

BASE< $4 a day / PPP

Link

EducationFin Services Health Agriculture Housing

32 millionpeople

4'500 millionpeople

Microfinance & Impact Investing at Credit SuisseAligning assets across the bank for industry impact and for our clients

September 2016 33

Providing capacity building via grants and expertise-sharing

Corporate CitizenshipMicrofinance Capacity Building

Private Banking &Wealth Management

Providing private capital via investment vehicles

Investment Banking

Providing public capital via access to capital markets

Complements our business commitment, incl. collaboration on product development, research and communications/events

Six leading partners to deliver management strengthening, innovation and research projects

Skill-sharing programs through the Global Citizens Program, Virtual Volunteering and MF Advocates

Co-founder of responsAbility Product development &

offering Structuring of microfinance

and impact funds Administration and custody of

microfinance and impact funds Market research

Pioneer global IPOs of MFIs:

Innovative debt raising for MFIs:-

2012 IFC/FT Sustainable Finance Awards

Special Commendation Global Sustainable Bank of the Year

2014 Business in the Community Awards

Expertise and Funding Expertise, Grants, Partnerships

Expertise and Funding

Developing the microfinance industryStages and drivers

Credit Suisse Business

Microfinance Capacity Building

Uncoordinated Innovation

Market Place Building

Capturing Value

Maturity

Investment

Expertise

Employee Expertise Programs

Microfinance/Impact Investment at Credit SuisseWhat Is Impact Investment

Return

Investment

Return

Financing

Payment

Service End-BeneficiariesSocialEnterprises (selection)

ImpactInvestmentVehicle

Investors

Investment fund Structured

product Private

placement

Retail HNWI/Family

Office Institutional

(Micro-) Entre-preneursSmallFarmers

StudentsMicrofinan

ce InstitutionsAgricultural Cooperatives

Education Programs

Impact Investing is about actively placing capital in enterprises that generate a financial return and make a positive social/environmental impact

Investment Process

because our clients care

63%

26%

11%

Social impact

Financial return

Diversification

Motives for investing in microfinance

Source: Credit Suisse internal survey, 2008

Benefits for ClientsSound Financial Returns

PositiveSocialImpact

PortfolioDiversification

Strong QualityOf UnderlyingAssets

Delivers steady and positive returns with low volatility (3–6% net return p.a.)

Access to finance for small businesses (microfinance), fair access to markets for small farmers (fair trade), education for high potential students

Historically constitutes low correlation vs. other asset classes. Financing SMEs detached from global capital markets.

Experiences very high repayment rates from asset underlyings (e.g., 98.5% of microfinance clients repay their loans on time, 99% of students repay their loans)

Impact Investment – back to the clientWhat matters to our clients

37

Still a young industry Lack of pipeline Lack of investible MFIs Lack of volume Lack of track record… .. .. .. Lack of management capacity

Microfinance Investing: Hurdles

Microfinance 2.0: Beyond Credit

Many risks are internal to the organization…

September 2016 39

Microfinance Capacity Building Initiative (MCBI)Market development and capacity building to develop more diverse financial services

Virtual Volunteering Microfinance Advocates Network

Credit Suisse expertise sharing and employee engagement:Global Citizens Program: In-the-field skills-based volunteering

Virtual Volunteering: Innovative remote skills-based volunteering program leveraging international teams

Microfinance Advocates Network: Events, news and local volunteering

MissionMarket development and innovation by strengthening

MFIs’ ability to serve the increasingly diverse financial needs at the base of the pyramid through:

• Enabling product and services development and innovation across sectors beyond traditional microfinance products

• Developing strong industry partnerships and knowledge sharing

• Effectively leveraging Credit Suisse’s skills, expertise, financial and social capital

• Continuous measurement and optimization of impact

7

41

Finance Innovation

Women’s Empowermen

t

Education

Agriculture

Housing

Accion Venture LabCentre for Financial Inclusion

Women’s World BankingLeadership and Diversity for Innovation Program

Opportunity International Empowering Generational Change through Education FinanceFINCA International Sustainable Agriculture Finance InitiativeSwisscontactMicroleasing Innovation

SCBF with HabitatSustainable Housing Initiative

Microfinance Capacity Building Initiative (MCBI)Grant programs with global Reach

Focus on Women: Women still face greater financial exclusion in every geography and across every income level

42

Source: World Bank FINDEX database/ Women’s World Banking

43

Women’s World Banking develops innovative financial products to meet the dynamic needs throughout a woman’s life

Expanding Financial Access

MarriageStart a business

ChildbirthEducation

Home ownershipHealth

Children’s education and marriageSupported by family

Credit (C) Insurance (I) Savings (S)

YOUTH

LATE ADULTHOOD ADULTHOOD

YOUNG ADULT

S C

S I S C I

S C I

Source: Women’s World Banking