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Plenary Session: Building Better Lives - Sustainable Integration of Microfinance with Education in Child Survival, Reproductive Health, and HIV/AIDS Prevention for the Poorest Entrepreneurs

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Plenary Session: Building Better Lives - Sustainable Integration of Microfinance with Education in Child Survival, Reproductive Health, and HIV/AIDS Prevention for the Poorest Entrepreneurs

Remarks by Kate McKee

…Chris [Dunford] makes a strong and a well-documented case on the value of packaging microfinance and education resources. Clearly they are mutually reinforcing. …And, I strongly agree with Chris that we need to be more open minded about the integration of non-financial services with microfinance, be they health, nutrition, literacy, or even business development services. Minimalist microfinance delivery clearly has some powerful pluses, but it has some drawbacks too. It has almost taken a moral dimension, this idea of minimalism, rather than simply a practical one…. I really liked Chris' hypothesis as well, that success with credit increases the learning readiness of clients, and paves the way for introducing new information, skills, and support. I think this concept fits with much of the experience that we have all had in the field. And, it is a compelling empowerment argument that helps bring the pieces together about why the sum is greater than the parts. So, well done Chris! You have done a lot to advance our practice and our understanding. But, I am never satisfied, and there is more to be done.

"I really liked Chris' hypothesis as well, that success with credit increases the learning readiness of clients, and paves the way for introducing new information, skills, and support."

I would like to take the next few minutes to suggest a couple of ways we can go further with this analysis and this experimentation. In particular I would like to highlight two fruitful directions that I think we need to further experiment with. The first is to push further with packaging microfinance with education, and I would like to suggest a few ways that we might keep moving forward on this. The second is to invite all of us, as a practitioner and donor community, to actively explore bundling business development services (BDS) with microfinance because I think it offers synergies of impact that are well-documented in this paper. So, let's look at each of these in turn. If we take the current state of the field as described by Chris as our starting point, first, I think we need to push further on the unified model. …. There must be ways to do that which are more sustainable. We need to learn from the wealth of experience that we have. We need to explore further the possibility of spinning off some of the educational delivery and facilitation functions to the women and the groups, or other members of the community. This would probably reduce the cost and, more importantly perhaps, it would permit the Microfinance Institution to focus on the more demanding task of continually developing educational content and tools with its scarce subsidy and energies…

…. My second question is, how can this rich experience with bundling microfinance and education together be applied beyond village banking institutions for those MFIs that use different methodologies, particularly individual lending methodologies? Aren't there some lessons that could be applied as well? Many of them are already starting to use group processes for activities such as business services, or networking among clients, or trade fairs. Why not for a variety of other educational services as well? Perhaps our most obvious testing ground for some of these ideas on the frontier are in the areas that are ravaged by the HIV/AIDS pandemic. Microfinance institutions recognize that they can't leave their heads in the sand. They must take action….Let me make one final point then before I close. And, that is to turn to the second challenge of looking at how business development services might be bundled with microfinance, rather than the more clearly public goods services we have been discussing this morning. Although this has been almost taboo in the microfinance field, my colleagues and I feel that we will actually be seeing more and more integration of microfinance and BDS in the near future through the whole range of models- unified, parallel, and linked. The clients want it, the institutions see it to be in their self-interest. It is a win-win. There are reasons why parallel or unified services might work especially well with BDS. Many clients use microfinance for enterprise purposes already, so it is closely related to why they are coming to your institution. It is equally powerful from a perspective of mutually reinforcing synergies of impact…

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