Youth, Digitization and the Climate Are Our Priorities for the Future

FinDev: Your organization, ADA, is the host of African Microfinance Week (SAM), the region’s biggest microfinance event. This year’s edition focuses on the impact of financial inclusion. How does ADA see financial inclusion and how do you define and work towards impact?

Laura: Over the past 25 years, ADA has been developing projects that promote inclusive finance. At the very beginning, we focused on microcredit, then we quickly shifted to microfinance in order to include a wider range of products to address the different financial needs of marginalized populations. Today, the concept of financial inclusion involves initiatives, techniques, and approaches that allow us to use finance as a tool for inclusion. Financial inclusion is a way to offer excluded populations more opportunities and choices to improve their income-generating activities, and consequently their families’ quality of life. 

For ADA, impact is part and parcel of our mission statement aimed at poverty reduction. We work towards this goal through initiatives which can contribute in a responsible way to sustainable changes for target populations and their environments. Our 2018-2021 strategic development plan aims to improve our methods for defining and measuring our contribution to change. Among the expected results of our projects, we include quality of life improvement for micro and small entrepreneurs and their families, job creation, and economic and social development in the targeted areas. 

In order to achieve these impact objectives, we needed to adopt a theory of change perspective for our project management – from conception to monitoring and evaluation - and identify key monitoring indicators, with clients and their needs at the center. This approach has tremendously improved our results. Now we, along with our partners, can observe, monitor and measure the impact of our projects, and ensure that the necessary conditions are in place for the achievement of impact.

For ADA, impact is part and parcel of our mission statement aimed at poverty reduction.

FinDev: Tell us about SAM. How has it evolved, and what are your expectations for this year’s edition?

Laura: This year marks the fourth edition of the African Microfinance Week (SAM). The event falls under our knowledge sharing pillar, which represents one of our several approaches to the inclusive finance sector.

After the first edition in Arusha in Tanzania in 2013, we realized along with our partners the need for a common space for discussion and exchange to follow the evolution of our fast-changing sector. SAM has evolved alongside its stakeholders and partners over the years to become one of the landmark events for inclusive finance on the African continent from north to south and from east to west. 

For this year, we made an ambitious choice! We wanted to answer a host of questions about how financial inclusion contributes to the achievement of the Sustainable Development Goals (SDGs). These goals concern us all and we only have 11 years left to reach the targets set by the global community. 

To address these goals, we feel it is urgent to focus on financial inclusion in Africa and discuss the complex and difficult questions that many stakeholders grapple with. What real impact does financial inclusion have in combating poverty? How do certain financial services contribute to improvements in education? Which kind of financing mechanisms allow the advancement of sustainable agriculture to reach the “zero hunger” objective? And many more questions and discussions. We look forward to rich debates, deep exchanges, and sharing of solutions and practices that can inspire us for years to come. 

In addition to the regular conference sessions, SAM is offering more than 20 training courses and workshops to address the rising needs for the professional development of the sector. The event is also an occasion to meet potential partners or clients at the Investors’ Fair. And we have widened the space dedicated to innovation by opening an Innovators’ Village this year.

FinDev: What regions does ADA focus on, and why?

Laura: Our top priority is the least developed countries, where needs are the most urgent and complex. Because most of these countries are in Africa, that is where our focus lies. But financial inclusion in Africa varies tremendously from one sub-region to the next, with some countries leading the way with great innovation, and others lagging behind. For example, in West Africa, where digital financial services are still at an early stage, we intervene to build the capacity of MFIs that are embarking on digital transformation to increase outreach. 

Outside of Africa, in regions where financial inclusion is more mature, our interventions are quite different. In Latin America and Southeast Asia, we opt for partnerships with MFI networks, which allow us a more efficient and effective way to expand our action.  

FinDev: Your work is based on partnerships in the countries where you work. What do you consider to be the key elements of a successful North-South partnership?

Laura: ADA bases its work on building effective partnerships where involved parties enter into a win-win relationship. Every region, every country, every institution has its idiosyncrasies and different ways of expressing them. Our starting point is always around sharing our objectives and determining how each partner will engage with them depending on their resources and priorities. The essential conditions for a successful partnership are involvement, participation, commitment, and transparency among partners. 

Youth, digitization and the climate represent our priorities for the coming years and especially for Africa.

FinDev: Looking forward, what are ADA’s main strategic priorities for the next five years?

Laura: The financial inclusion sphere is in constant transformation. Innovations and technological advances represent a great opportunity for financial inclusion, but they can also radically and rapidly change the context in which many MFIs work. New actors arrive, new approaches are proposed, and new regulations are established. In this context, the role of ADA is to ensure a sustainable and shared innovation which puts the final beneficiary - the customer - at the center. We are therefore focusing on MFIs and networks that want to undertake this transition for greater impact and we also support new players such as incubators, accelerators and fintechs who can play an increasingly important role for financial inclusion. Youth, digitization and the climate represent our priorities for the coming years and especially for Africa.