Growing Potential: Microfinance-Plus Approaches for Cultivating the New Generation of Young Clients

This paper draws upon case studies from early entrants into the youth financial services (YFS) market to examine the socio-economic and business case for providing youth with tailored financial services.

The paper states that Making Cents International (MCI) along with a growing cadre of organizations believes that providing young people with tailored financial services at the right times in their lives and with the right support services can help them improve their education and livelihoods in the short term, and position themselves for more sustainable productive lives in the long term. MCI partnered with Equity Bank in Kenya, Hatton National Bank in Sri Lanka, and Fundación Paraguaya to study their business models of YFS. The paper concludes that these early examples provide promising models for future growth in the YFS sector. Recommendations highlight the importance of:

• Continued product innovation and research around cost-effective microfinance-plus models;
• Policy and regulatory reforms for increasing children and young people‘s independent access to savings accounts;
• Greater funding to support ongoing product experimentation and documentation.