Access Africa: Equal Access to Financial Services Executive Summary Nearly four decades of global microfinance experience have proven that when poor people have access to financial services – secure savings, credit, insurance and other products – they can lift themselves out of poverty. Poor people, and especially poor women, are a good credit risk. They invest wisely, not only in income-generating activities, but also in the welfare of their families. Access Africa, CARE’s new signature program, is a bold, 10-year investment whose returns will be dramatic: 30 million people in 39 sub-Saharan African countries will have the means to break the vicious cycle of poverty, and transform it into a virtuous cycle of rising income, improved health, better education and greater participation in their communities and nations. Access Africa will leverage grant funding and commercial finance to develop independent, complementary, low cost channels of financial service delivery to overcome the constraints that traditional banking and microfinance channels face. The campaign would scale existing institutions, start new institutions, develop local intermediaries, and find new solutions to reach ‘the last mile’. Over the next decade, CARE’s Access Africa program will reach 30 million people – 70 percent of them women – with a suite of basic financial services. We believe reaching that many people will be the tipping point for developing a financial sector in which all citizens can participate. The signature program is a long term, programmatic approach to microfinance. It will be implemented at a large scale and it provides an opportunity to deepen our work on the social positions and enabling environment aspects of economic empowerment. To achieve these outcomes, the signature program has five strategic directions. 1. VSLA Scale-Up. Access Africa will scale-up CARE’s successful village savings and loan (VS&L) program, currently under implementation in 19 countries. 2. Linkages. Based on our experience, between 20-30% of VS&L participants are likely to want to move on to access more sophisticated financial services. CARE will develop a partnership program, partnering with MFI’s and local banks to develop products and services for VSLA clients. 3. Establishment of a Predictable Finance Chain for MFIs. The program will establish financing mechanisms to ensure that MFI partners can grow their business without financial constraints. 4. Technology. An essential component of the program will be the development of technology solutions, including standardized front-end, back-end, and other financial systems. 5. Advocacy. The advocacy strategy will be implemented at various levels, working primarily at the national level but taking time to identify the issues that go beyond national level, such as issues that could be taken to the African Union, NEPAD or the G8. In order to implement this solution a continent wide approach is required. Therefore, our overall strategy calls for implementation across the 39 poorest countries in sub-Saharan Africa. However, our implementation level will be different in each country, with some being more intense than others. The 39 target countries have been divided into three waves. The first two waves will entail massive scale up of VS&LA implementation, and well as significant focus for the remaining strategic directions. The first wave countries will receive first priority for unrestricted funding and technical assistance in the first two years of the program, with an emphasis on starting up second wave countries as funding becomes available in the second and third years. In year four, third wave countries will implement VS&L scale up based on availability of funding and needs assessments starting. To achieve this, CARE is establishing partnerships with governments, microfinance institutes, telecom providers and financial institutions.
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