Which policy instruments are the most effective at financing business start-ups by under-represented...
22
Meet Victoria Obanye
-
Upload
oecd-local-economic-and-employment-leed-programme-and-its-trento-centre -
Category
News & Politics
-
view
1.149 -
download
2
description
Presentation from the capacity building seminar “Financing business start-up by under-represented groups”, 27-29 June 2012, Trento – Italy; organised by the Local Economic and Employment Development (LEED) Programme and its Trento Centre at the OECD in collaboration with the Directorate-General Employment, Social Affairs and Inclusion of the European Commission. See www.trento.oecd.org
Transcript of Which policy instruments are the most effective at financing business start-ups by under-represented...
Meet Victoria Obanye
• Commercial Experience
Policy Action Team 3
• Commercial Experience
• Motivation
Policy Action Team 3
• Commercial Experience
• Motivation
• Confidence
Policy Action Team 3
• Commercial Experience
• Motivation
• Confidence
• Cultural Barriers
Policy Action Team 3
• Commercial Experience
• Motivation
• Confidence
• Cultural Barriers
• High Quality Business Advice
Policy Action Team 3
• Commercial Experience
• Motivation
• Confidence
• Cultural Barriers
• High Quality Business Advice
• Appropriate Finance
Policy Action Team 3
1. Passport
2. Driving License
3. Utility Bill
Identity
1. Passport
2. Driving License
3. Utility Bill
4. Employment
5. Assets/savings
6. Credit history
Analyses
Identity
- one bank account - cash based transactions - few invoices - no accounts - no cashflow projections - no or limited trading history - bad or no personal credit - bad credit history - legality questions
1.
Start up micro business
Lender Average APR
Morses Ltd 365%
Provident 469%
Rhodes Finance 1064%
CLC 1564%
Pay Day 2500%+
1. Price
2. Security
3. Brand/marketing
4. New technology
5. Ethics
Priorities in choosing financial products
1. Accessibility
2. Flexibility
3. Honesty and simplicity
4. Respect
5. Relationship
Priorities in choosing financial products
No-one wants charity They just want a fair chance
People
Product
Perception
European Microfinance Network
88 Members in 23
countries
Full members, Corporate
members and Partners
NGOs, Banks, Think tanks,
Research institutes, Funds
72% Practitioners
12% Corporate members
24% Eastern Europe
24% research, consulting
companies
EMN Members
1. Variable quality
2. Regulatory challenges
3. Expectation challenges
4. Funding problem
5. Limitation of scope
Challenges
Are small or medium social businesses
Have non standard legal structures
Innovating financial services
Conduct a business that the mainstream consider too risky
Independent
Successful microfinance organisations…
Are small or medium social businesses
Have non standard legal structures
Innovating financial services
Conduct a business that the mainstream consider too risky
Independent
- A regulators nightmare!
Successful microfinance organisations…
Lend on commercial terms
Benefit from security and ‘first loss’ cover provided by social investors
Bring social and commercial investors together
Banks
Social investors
Donors
Grants focused solely on areas where needed most
Increase impact by leveraging commercial finance
…revolutionize finance, starting with the people whom the mainstream have left behind….
Meet Mama’s Kitchen
