FinDev Guide

COVID-19 FinDev Weekly Update | 18-24 June 2020

Roundup of the most relevant coronavirus-related resources for the microfinance and financial inclusion community
A running boy. Photo by Mansour Mohse, 2018 CGAP Photo Contest.

FinDev Gateway has created this COVID-19 weekly update with the latest and most relevant knowledge resources for financial inclusion as they become available. Sign up to receive FinDev's weekly update each Friday with a summary of the main issues covered during the week. 

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Global Summary

  • On World Refugee Day (20 June), the Alliance for Financial Inclusion (AFI) emphasized the importance of including forcibly displaced people (FDPs) in financial inclusion policies and regulations, arguing that “with host countries already focused on alleviating the economic impact of COVID-19 on their own citizens, FDPs are in danger of being excluded from government safety nets and emergency plans.” 
  • ADA, Inpulse and Grameen Crédit Agricole Foundation are working together to monitor the effects of COVID-19 on their partners and shared the first round of results, which include responses from 110 organizations in 47 countries around the world. Though there are strong regional differences in impact, common problems among all MFIs surveyed include difficulties with disbursements, collection of reimbursements and meeting with clients.
  • Innovations for Poverty Action (IPA) and the International Growth Centre (IGC) have created a new survey to monitor the socio-economic impact of COVID-19 on firms, workers and farmers. Their joint website will share data and results from the new survey, as well from the World Bank’s Business Pulse Survey, which has been harmonized with the IPA/IGC survey questionnaire in a joint effort to draw results that are more comparable across projects and countries. 
  • The IMF has developed a structural framework for the joint stress testing of solvency and liquidity, providing a methodology for quantifying the impact of economic shocks from the COVID-19 crisis on the solvency and liquidity of financial institutions. The approach may serve as a useful tool for adjusting policy responses.

Asia

  • M-Cril estimates that the main small finance banks in India will require $200-330 million each in funds from investors and lenders - equivalent to 20 percent of the overall funds currently managed by each of them - in order to survive and revive their businesses after the moratorium period ends. 
  • Digital payment fraud continues to be a problem in India, prompting the Reserve Bank of India to ask payment systems operators to educate their users on safe and secure use of digital payments through multilingual campaigns using SMS and advertisements.
  • The Foundation for Development Cooperation, based in Australia, shared results from a survey it conducted with the Banking with the Poor (BWTP) Network of 1,500 microfinance providers across 11 countries in Asia. 90 percent of the clients surveyed had requested a grace period or extension of loan repayments. Most MFIs surveyed were experiencing significant, negative impacts on key financial measures such as current and debt/equity ratios, operating margins and percentage of portfolio at risk.

Africa

  • The Central Bank of Rwanda has announced the reintroduction of fees on mobile money transactions after a three-month moratorium on fees. Meanwhile, in Kenya, the Central Bank announced the extension of emergency measures to facilitate cashless transactions until the end of the year.
  • Madagascar will offer a stimulus package to nearly a million small businesses, offering secure loans at below market rates. 
  • The Microfinance Support Centre in Uganda told Parliament that it will need over $83 million to facilitate the recovery of 1,749 Savings and Credits Cooperative Societies (Saccos) and 14,842 Village Savings and Lending Associations.
  • In Togo, the National Fund for Inclusive Finance (FNFI) is supporting MFIs by reducing interest rates and adding bonuses on financing. 
  • The lack of identity documents is becoming a bigger issue across the continent, as people without ID may be denied welfare and health services. A digital financial identity could change that.

For more on Africa, check out the latest Portail FinDev Weekly Update in French.


Latin America and the Caribbean

Most articles and knowledge resources referenced in this section are in Spanish.

  • A survey conducted in 17 countries in the region by the IDB shows that households with the lowest income prior to COVID-19 are the most impacted by the pandemic’s economic effects, with 71 percent reporting that a household member lost their jobs and 61 percent having to close their businesses.
  • In the first four months of the year, bank deposits reached a record high volume in Mexico, as people and companies saved more money to face a more complex economic turndown than expected.
  • In Ecuador, 50 percent of loans placed in the microfinance sector have been refinanced and 64 percent of these refinanced loans are from the provinces most affected by COVID-19.
  • The Bolivian government approved a fund to reactivate the micro, small and medium enterprises, a sector that generates 80 percent of employment in the country.
  • The Central Bank of Brazil suspended Facebook’s WhatsApp payment services days after its launch, to ensure competition in the mobile payment space.

For more on LAC, check out the latest Portal FinDev Weekly Update in Spanish.


Arab World

  • The European Union is hosting a virtual conference this week to mobilize dialogue and further humanitarian and development assistance for over 11 million people in need both inside Syria and in neighboring countries. With the COVID-19 economic downturn, refugee households are taking on additional debt and are not able to pay their rent anymore, according to UNHCR.
  • Data from the Vitas Group COVID-19 Impact Client Survey in Egypt, Iraq, Jordan, Lebanon, and Palestine shows that family health is the largest concern among clients, followed by financial worries. Most clients surveyed either used savings or relied on family and friends to cope with the ongoing financial crisis.
  • A recent study by Egypt’s official statistics agency shows that 50 percent of Egyptian families are borrowing from others to counter the effects of the coronavirus, 17 percent rely on charity and 5.4 percent receive the employment grant for irregular workers.

For more on the Arab world and resources in Arabic, check out the latest FinDev Weekly Update in Arabic.

COVID-19 Resources

Man on a boat with a lantern. Photo by Uttam Kamati, 2017 CGAP Photo Contest.

Global Community Response to COVID-19

A list of organizations offering resources and insights on COVID-19 & microfinance

FinDev Guide to Data - Tracking the Global Response to COVID-19

FinDev Coronavirus Data Tracker

Data relevant for financial inclusion - find out who is tracking what

Discussion Forum.

Discussion Forum

Forum for the financial inclusion sector to discuss responses to COVID-19

 



New Data Sources

View our complete Data Tracker listing most important sources and trackers by the level of their relevance to the sector.

Microfinance and COVID-19: Insights from CGAP's Global Pulse Survey

CGAP will use this space to regularly share analysis of the latest data for the duration of the survey of microfinance institutions.


COVID-19 and Your Finances: Wave 3 | BFA Global 9-Country Survey

Results from Wave 3 (29 May - 5 Jun) of BFA Global's rapid survey of over 1,800 low-income people in nine countries show how people at the bottom of the pyramid are dealing with this novel coronavirus.  


COVID-19: Economic Impact Surveys

This survey aims to monitor the socio-economic impact of COVID-19 on firms, workers and farmers. The website will also include data from the World Bank’s Business Pulse Survey, which has been harmonized with the IPA/IGC survey questionnaire in a joint effort to draw results that are more comparable across projects and countries. 


New Information Platforms

View our complete list of organizations offering resources and insights on COVID-19 & microfinance >>

The IMF and COVID-19 (coronavirus)

This platform shares the latest news, blogs, multimedia, FAQs and factsheets developed by IMF.


The Impact of COVID-19 on Insurance Markets

This page tracks the major challenges faced by both insurance regulators and providers from COVID-19 across sub-Saharan Africa and the responses to these challenges. 



Recent Publications

For a complete list of publications and to learn how you can share your research with us, visit FinDev's Publications page.

Policy, Regulatory, and Supervisory COVID-19 Responses for Microfinance
 
These notes focus on policy and regulatory responses adopted by financial authorities in four countries, including measures enabling microfinance providers to operate safely, providing temporary relief to clients, increasing providers’ access to liquidity, and simplifying supervisory processes where appropriate. 

Liquidity in Lockdown – Update: Surviving the Pandemic
 
This Advisory Note estimates the magnitude of the liquidity shortfall for small finance banks resulting from the current six-month moratorium.


COVID-19 Response: Guidelines for Financial Service Providers in Mozambique
 
These guidelines address policy and regulation adaptation, risk management frameworks, existing and new partnerships, refinement of business models, organizational structure, and more.


Liquidity at Risk: Joint Stress Testing of Solvency and Liquidity
 
This paper provides a methodology for quantifying the impact of economic shocks from the COVID-19 crisis on the solvency and liquidity of financial institutions. The approach may serve as a useful tool for adjusting policy responses.


Beyond the Difficulties Posed by the COVID-19 Crisis, New Opportunities Are Emerging for Microfinance Institutions (MFIs)
 
This publication analyzes the effects of the COVID-19 crisis among 110 MFIs in 47 countries, evaluating both the effects of the crisis and the financial needs and adaptation measures implemented by the MFIs.


Does Going Tough on Banks Make the Going Get Tough? Bank Liquidity Regulations, Capital Requirements, and Sectoral Activity
 
This paper explores cross-country evidence that can inform us about possible effects of tighter bank regulations on economic activity during both normal and crisis periods.


SHG Awareness and SRLM Employee Training Comic on Coronavirus
 
MSC’s comic booklets on COVID-19 are illustrated narratives that build awareness among State Rural Livelihoods Mission (SRLM) staff members and SHG members during the pandemic. 

 

View All Publications Related to COVID-19 >


Blogs & Opinion

If you have a blog idea and would like to write for the FinDev Blog, please see our review our guidelines. We do not cross-post blogs that have been published elsewhere, but if you wish to share an existing blog post in our next FinDev Weekly Update, you can send it to us using our contact form

Socio-Economic Impact


Introducing the IPA-IGC COVID-19 Economic Impact Surveys


Forced Displacement and COVID-19: Why Financial Inclusion Matters


Food Security and COVID-19: How Financial Inclusion Can Support Livelihoods


The Voices of COVID19 Microfinance Customers


Government Responses


Are Moratoriums Good for Clients?


You’ve Got Money: Mobile Payments Help People During the Pandemic


Cash Transfers in the U.S. are Exploding: Here’s How to Make them Effective, During COVID-19 and Beyond


Health Finance


Building Back Better: How the COVID-19 Crisis Could Lead to an Integration of Health Care and Finance


News 

For the latest news on the impact of coronavirus on financial inclusion, visit our News listing pages.

Philippines: ADB Grants MFI-NGO $30-M Credit Facility for Micro-Entrepreneurs


COVID-19: FNFI Backs Nine Microfinance Institutions


IFC Finances Garanti BBVA to Support Turkish MSMEs Amid the COVID-19 Pandemic

 

View All News Related to COVID-19 >


Webinars

For the latest events - hosted by organizations worldwide - exploring the impact of coronavirus on financial inclusion, visit our Events listing page.

Research Methods to Identify COVID-Related Financial Crimes


Using Customer Insights to Drive Your Crisis Response: A Conversation with BRAC International and Ujjivan (India)


Microfinance and COVID-19 in Pakistan: What Happens After Lockdown?


The Economic Impact of COVID-19: Results of a Global Survey of Microfinance Customers

 

View All Events Related to COVID-19 >

View All Webinar Recordings >

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