Comment boards lit up around the globe when Bill Gates declared that “by 2035, there will be almost no poor countries left in the world.” Not surprisingly, many scoffed at the idea, often citing examples from various countries. This reaction underscored an important fact that that was also highlighted in the Gates Annual Letter: outdated images of poverty are still very pervasive.
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At Grameen Foundation, our goal is to spur innovation in the global movement to eliminate extreme poverty. Part of that work is to develop better solutions and share them with people like you.
On GF Insights, we share lessons learned from our leaders in the field, news about efforts to expand access to financial and information services for the poor, and how poverty-focused organizations are using data to improve the way they work.
By Juan Forero, Mobile Financial Services & Commercial Manager, Grameen Foundation
Though mobile phones and other technologies hold great promise for improving lives in poor, rural communities, there is still debate about how they can best be used to improve agricultural and rural development. Last November, Grameen Foundation and the Food and Agriculture Organization of the United Nations (FAO) hosted an e-forum to discuss some of the central successes and challenges of emerging and established technologies. The result was a timely dialogue that will inform discussions at the World Summit on the Information Society (WSIS+10) Summit, to be held in Egypt this year.
Throughout the wide-ranging exchange, several key topics came to the fore that deserve closer scrutiny in 2014: the influence of measurement, the impact of gender, and the role of public-private partnerships.
Just as increasing use of a “gender lens” has transformed thinking about and the practice of international development in recent decades, so too can behavioral economics in the near future. In some cases, this discipline explains and reaffirms current practice. In other cases, the study of behavioral economics provides an alternative explanation of why some things work and others don’t. In still other cases, it suggests that current thinking and so-called “best practices” are wrong and counter-productive. Now and then, it prompts us to consider readopting a practice that has fallen out of favor.
Now, I will comment on the specific insights and implications I see for microfinance and international development when looked at through a behavioral economics lens.
The field of behavioral economics – the intersection of psychology and economics – is fairly new. This is a partial explanation of why its lessons have not yet been applied much to microfinance and anti-poverty programs generally. But this is clearly changing, and none-too-soon, as microfinance in particular is in need of reinvention and rebranding.
In fact, I am coming to believe that thoughtful applications of behavioral economics can be a central part of defining and realizing the idea of “responsible microfinance” that the Microfinance CEO Working Group and others are championing and also “full financial inclusion” that moves the dial on poverty.
At Grameen Foundation, we’re committed to sharing our experiences and insights with others. Only together can we leverage the resources and know-how to connect the world’s poor to their potential. In this spirit, we offer up four lessons learned or affirmed through our work, along with relevant resources we or others have published over the course of 2013.
CARD Bank savings client with her new ATM card
Human networks are critical to overcoming the gender barriers and literacy challenges faced when delivering products and services to the poor
This year, we published several resources related to better understanding and utilizing human networks to eliminate global poverty: