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Impact investing: caught between charity and a new view on capital

September 30, 2015

A recent post by Chicago Booth asks a big question: is Impact investing more than charity? While the question is admittedly provocative, it shows the progress still needed by industry participants. A lot of energy has been dedicated to impact measurement, and there is more work needed on financial performance. A recent report by the GIIN and Cambridge Associates aims at filling the gap. To be clear, impact investing consists in the combination of financial returns and a social/environmental impact. Intentionality and measurement are commonly included in  this definition. Read more…

Is it worth measuring impact? A thought-provoking approach

July 7, 2015
GIIN Impact Benchmark Performance

GIIN Impact Benchmark Performance

Two reports caught our attention recently, one from the investment company responsAbility and one from the GIIN. The GIIN report analyzes a unique dataset and brings positive news to the impact investing industry: the financial performance of Impact funds has been relatively in line with traditional private equity funds’ in 1998-2010. On a more cautious note, the responsAbility report wonders if we are not spending excessive resources on intermediaries. As we witness the growth of an entire industry focused on just calculating impact, the report shows the limitations of impact measurement. So is it worth measuring impact? Read more…

New study brings evidence on how big data can predict loan repayment

June 10, 2015

SustainabilityA recent paper adds evidence to the common knowledge that phone data hold valuable information on the payment profile of the holder. Researchers at Brown University used the telephone data of a Caribbean company and built a model to predict loan repayment. The approach compares the predictability (scoring) from the telephone data to a classic credit scoring. What caught our attention is that the model did not use payment information of phone bills, but other behavioral data such as the number of calls made. Overall the model using behavior showed a good predictability of loan repayment – a positive news for financial inclusion. Read more…

When Brazilian banks downscale: what does it mean for financial inclusion?

April 1, 2014
Brazil in figures

Key figures on Brazil (source: Bader, Savoia 2013)

A book recently published on financial inclusion in Brazil caught our attention (Marcos Bader and Jose Savoia, Inclusao Financeira, Sao Paulo: Saint Paul Editora, 2013). Interestingly, both authors have ample experience in the local banking sector and defend the idea that new technologies, and in particular the use of the internet via cell phones, represent a unique opportunity to bancarize the population and drive growth.

 

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Reading the pulse of the private equity sector in East Africa

March 20, 2014

This morning I attended the presentation of the results of the Deloitte and AfricaAssets 2014 East Africa Private Equity Confidence Survey.

PE confidence survey 2014Some interesting key themes about trends in the sector emerged from the presentation and discussion.

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Bernanke and the financial crisis

October 14, 2013

As Janet Yellen was nominated by President Obama to replace Ben Bernanke at the head of the Federal Reserve after January 2014 (see recent NYT article), we thought of Mr Bernanke’s legacy and read his book on The Federal Reserve and the Financial Crisis (Princeton UP, 2013). He explains the guiding principles behind the Fed’s actions, always in his clear style, not without reminding first the history of the Central Bank – he was trained as an economic historian, after all. In his view, the action of the Fed during the crisis was consistent with a long history of regulation and intervention, and the extraordinary steps taken helped avoid a worse outcome for the economy. He also draws some lessons from the crisis.

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A video from Mexico: the experience of Telecomm and mobile banking

September 23, 2013
Logo of M Pesa, a success story in mobile banking from Kenya

Logo of M Pesa, Kenya continues to be a success story in mobile banking

Mexico has been particularly active in the field of financial inclusion over the past few years. The emergence of banking correspondents and the recent launch of mobile banking by players such as Yastas and Telecomm should bring financial services to millions of Mexicans. We came across a very interesting video by CGAP produced by Jeanette Thomas on the Telecomm experience and its value proposition for users. The Mexican telegraph company Telecomm launched this pilot in remote cities in the Oaxaca region. This real example shows the many advantages of mobile banking. Read more…

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