Marta Bekerman --The Next Generation of Innovations: A Medley of Products, Services & Programs...

#17MCSummit

17TH MICROCREDIT SUMMITGENERATION NEXT: INNOVATIONS IN MICROFINANCE

THE NEW GENERATION OF

INNOVATIONS IN MICROFINANCE

Marta Bekerman• Senior Researcher and Full Professor of the

University of Buenos Aires• President Asociación Civil AVANZAR por el

Desarrollo Humano

#17MCSummit


• Need to develop innovative proyects to face social exclusion.

• The end of poverty cannot be seen as an automatic result of the market forces.

#17MCSummit


• Problems faced by the subsistance microenterprises

• Brief presentation of the Asociación AVANZAR

• Activities developed under the programme “Vos Podes AVANZAR”

• Results

• Some reflections.

#17MCSummit


Problems face by microenterprises

Free entry of competitors

Demand limitations

Low levels of production

Lack of finance

#17MCSummit


• Lack or accounting registration that could show the inflow and outflow of money and other type of actives

• Lack of promotion and comercialization strategies

• Lack of knowledge about the rol and existance of their competitors

• Non existance of a bussines plan to be able to carry out a more efficient management and folow its evolution in time

• Progresiva disacumulation of capital as a consequence of not taking into account the depreciation of fix capital as one of the business costs

MAIN OBSTACLES IN THE SHORT RUN

#17MCSummit


• Insuficient determination of some fix costs including their own salaries.

• Uncertainty and lack of information dont allow them for an optimum resources asignation. They adjust their activity just to get some level of subsistance

MAIN OBSTACLES IN THE SHORT RUN

#17MCSummit


• Low level of investment that limits their possibilites of expansion just to simple capital reproduction

• No invesment in new fix capital (machinery) even, in many cases, su replace amortized capital.

• Lack of diversification of products and of innovation as a strategy to improve the insertion in the markets.

• No development of economes of scale because of very low levels of production

MAIN OBSTACLES IN THE LONG RUN

#17MCSummit


NO INVESTMENT

FREE ENTRY OF COMPETITORS

LIMITS OF DEMAND

PRODUCTION LOWER THAN AN OPTIMUM LEVEL

NO INVESTMENT

REPRODUCTION OF SUBSISTANCE BEHAVIORS

#17MCSummit


Growt of microenterprises en

Latin América

As viable alternatives for people that are out of

the working market

#17MCSummit


“ 93% of the microenterprises dont reach the second year

of life”

Source : Asociación Argentina para el Desarrollo de la Pequeña y

Mediana Empresa

#17MCSummit


• PROBLEMS LINK TO MARKET FAILURES OR MARKET EFFICIENCY. Lack of acces to the market credit. Needs public regulation

• FOR EQUITY REASONS. Needs aditional things

WHY MICROFINANCE PROJECTS?

#17MCSummit


• Is better not to do it because is negative for the sustentability of the IMF

• Microfinance can be potenciated by training to get a qualitative improvement in the quality of life of the microentrepreneurs

WHY TRAINING ? DEBATE ABOUT THE ROLE OF TRAINING IN MICROCREDITS PROGRAMMES

#17MCSummit


The training procees allows …

To improve the quality and

solvency

To make stronger the relationship

between the institution and the

entrepreneur

#17MCSummit


Asociación civil sin fines de lucro

Microcréditos y capacitaciones

en Buenos Aires

#17MCSummit


• IT WAS CREATED 15 YEARS AGO BY PROFESSORS AND RESARCHERS OF THE UNIVERSITY OF BUENOS AIRES.

• Its objective is to contribute to the development of capabilities and the improvemement in the level of living of people of with poor resources, throw the acces to credit, training and social interaction.

THE AVANZAR ASOCIATION

#17MCSummit


¿Which is the contribuition of Avanzar

in this context?

Microcredits Training, Tutorials and Articulations

#17MCSummit


Ciudad Oculta…

#17MCSummit


Ciudad Oculta

#17MCSummit


• Ciudad Oculta• Los Piletones y Villas Aledañas• Fatima• Villa 20• Carrillo• Barrio de Soldati

SHANTY TOWNS WHERE AVANZAR WORKS

#17MCSummit


• OBJECTIVES• a) To sensibilize 1.000 emprendedores; • b) To train 500 emprendedores in entrepreneurial

managment. • c) To offer technical assistance to the

emprendedores, taking into account their particular needs.

• d) To articulate the microentreprises through the development of value chains.

PROGRAMME VOS PODES AVANZAR

#17MCSummit


-Sensibilization to promote the incorporation of the microempresarios to the programme.

-Training worshops to improve their capabilities : -In managment, costs registration and sales.

-In specific activities: textils, hairdressing, computing

, -Tutoriál work oriented to improve their business situation.

-Articulations with enterprises to expand their demanda.

PROGRAMME ACTIVITIES

#17MCSummit


• Improvements in the field of registration, comercialization, organization and monterary diferentiation between the business and home expenses.

• An improvement in the position of the institution regarding its image and prestige in the areas and the a fidelization of the loaners.

• The articulations made possible to incorporate innovative working experiences as well as new relations with enterprises of the formal market.

• Not always it resulted in the elimination of poverty , but certainly in an improvement in the quality of living and a reduction of the vulnerability.

Main programme efects

#17MCSummit


Logros del programa

Fortalecimiento de los proyectos: aumento de los activos y mejora en gestión, control de costos y ventas

Bases para futuros vínculos asociativos y de cooperación

Creación de una significativa red de emprendedores

#17MCSummit


It is very important that the trainers and tutors could adapt to the each microentrepreneur condition

Very strong impact of the tutorial work. It allows to reach an estrategic view wich goes much further than the every day answer.

The tutors should not offer all the solutions but facilitate the undrestanding of the problems and offer different alternativas to solve them.

SOME REFLECTIONS

#17MCSummit


In some productive chains, such us textiles, the demand conditions put clear limits to go further than basic fabrication in spite of the fact that they show potencial condicions to offer better quality and design.

The promotion of articulations should be link to a strategy of formalization of the economic circuits to reach a more equitative distribution of the benefits.

SOME REFLECTIONS

#17MCSummit


A NEW PROGRAMME OF E-COMMERCE FOR THE MICROENTREPRENEURS IS BEING DEVELOPED. IT INCLUDES:

A digital alfabetization project for the youth of the areas involved,.

The implementation of internet nodos where the microentrepreneurs will be able to came to learn about the new technologies and introduce their products in e-commerce.

Development of a logistic infraestructure for the delivery of the oriduct to the buyers.

THE NEXT STEPS

#17MCSummit


#17MCSummit


»MUCHAS GRACIAS

Marta Bekerman --The Next Generation of Innovations: A Medley of Products, Services & Programs...

Economy & Finance

Transcript of Marta Bekerman --The Next Generation of Innovations: A Medley of Products, Services & Programs...