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Your Global Resource on Youth Workforce Development, Entrepreneurship & Financial Inclusion

Banking on Change: The Youth Savings Group Model Making Cents International 23 March 2016

Banking on Change Overview

Tackling Financial Exclusion

• Today, about 2 billion people are financially

excluded

• Access to savings, bank accounts and credit

can enable individuals to invest in small businesses and increase household income

• Banking on Change’s savings-led approach to

microfinance aims to reduce poverty, increase social equality and encourage economic growth, as well as build the business case for linking informal savings groups to formal financial services

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A savings-led approach to financial inclusion

Step 1 Step 2 Step 3

• Identify the most

financial excluded individuals and communities- with a focus on young people

• Organise into groups

and build capacity through training in group processes and financial literacy

• Access to informal

financial services; group-based financial transactions

• Provide in-depth

enterprise training to support income generating activities

• Provide Bank Literacy

and Linkage training

• Access to demand-

driven savings products

• In time, access to

demand-driven

• verdraft products

Financial Exclusion

Informal Financial Inclusion

Formal Financial Inclusion

Key achievements

6-Year Stats Phase 2 Stats

418,016 savings groups

members have been supported

307,605 of these savings

groups members are youth

11,725 youth savings groups

have been established

695 Barclays employees have

engaged with groups through skills-based volunteering

755,000 people have been

supported

36,000 savings groups have

been formed

73% of savings group

members are women

4,132 groups linked to a

formal financial institution, more than half to Barclays

116,908 income-generating

activities have been started

The Banking on Change Youth Savings Group Model (YSGM) The Need

Overview: the Need for a YSGM

• Young people don’t join traditional VSLAs (18% U25 in BoC1)
• Young people are more financially excluded
• They are also much more likely to be unemployed (x3 – ILO)
• And there’s a global youth bulge (SSA: 63% U25)
• YSGs help tackle these challenges – but needs global effort
• Hence the Banking on Change Youth Savings Group Model
• A ‘How To’ Guide based on 11,500 YSGs + peer consultation
• Our ambition is to scale the use of YSGs to support youth

economic empowerment

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Youth Financial Exclusion

9 27.5% 17.0% 33.1% 20.5% 0% 5% 10% 15% 20% 25% 30% 35% Account at a financial institution, adults (25+) Account at a financial institution, youth (15-24) 2011 2014

The Youth ‘Bulge’

10 26% 16% 28% 40% 43% 17% 12% 17% 20% 20% 57% 72% 54% 40% 37% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

World More developed regions Less developed regions Least developed countries Sub-Saharan Africa

25+ 15 - 24 0-14

The Banking on Change Youth Savings Group Model (YSGM) The Principles

YSGM Principles

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A

• TARGETING AND FORMING YSGs

B

• SUPPORTING YSGs FOR SOCIAL &

ECONOMIC EMPOWERMENT

C

• SCALING & SUSTAINING YSGs

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10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 July - Dec 2013 Jan - June 2014 July - Dec 2014

New YSG members recruited – comparison over 18 months

Young People can save… but adapt Outreach Approach

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“

“I have been in many savings associations before, but the Youth Saving Group has more additional training which enables me to know how to manage my expenses and also keep separate records of all my

• businesses. This helped me know which
• f my businesses is making more

profits or losses. I used not to keep records and put all my monies into one bag without separating them.”

Banking on Change Focus Group Discussions Enterprise Your Life Specialist Youth Curriculum / Approach

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Linking to a formal financial institution can be a logical and attractive next step for YSGs.

The Banking on Change Youth Savings Group Model (YSGM) Experience from the field – Stella Tungaraza

How did we mobilize youth to form groups? Use of adult SGs to mobilize youth Creation of child/youth trainers’ teams Use of young field officers Integration with Plan’s youth programs such as ‘because I am a girl’

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In Tanzania we targeted youth aged 25-35 but included younger youth too. We wanted youth engaged in or wanting to start IGAs. Important questions:  How young?  Where are they?  What are they engaged in?

18 20,469 62% 5,564 17% 4,465 13% 2,527 8% 25-35 female youth 15-24 female youth 25-35 male youth 15-24 male youth

In Tanzania we focused on: EYL – ENTERPRISE YOUR LIFE

19 200 400 600 800 1000 1200 1400 1600 1800 Total Number of Groups Number of Groups received EYL Total Number of Groups Number of Groups received EYL

• USE OF CTs: Tanzania has approximately 120 youth CTs that

are community based and paid by groups. Over 60 new groups have been formed since end of December 2015 when the project officially ended.

• LINKING TO IMAs – About 30% of YSGs are members of IMAs.

The IMA provides groups with savings, loans and insurance.

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• LINKING TO TPB – Example of Muungano

IMA with 6 YSGs and 158 members all linked to TPB. The members can operate their individual accounts independent of the group but they can also buy shares, receive and repay loans via their accounts using mobile phone.

Thank you! Any Questions?

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Call for Proposals for the Global Youth Economic Opportunities Summit | Deadline March 25: http://www.youtheosummit.org/#!call-for-proposals/cxo4 10th Anniversary Global Youth Economic Opportunities Summit | September 28-30, 2016 | Washington DC: http://www.youtheosummit.org/ Stay up to date on the latest Youth Economic Opportunities resources, events and news with www.YouthEconomicOpportunitites.org.