Promoting Inclusive Markets and Financial Systems
The MasterCard Foundation works with visionary organizations to provide greater access to education, skills training and financial services for people living in poverty, primarily in Africa. As one of the largest private foundations its work is guided by its mission to advance learning and promote financial inclusion to create an inclusive and equitable world. Based in Toronto, Canada, its independence was established by Mastercard when the Foundation was created in 2006. For more information and to sign up for the Foundation’s newsletter, please visit www.mastercardfdn.org. Follow the Foundation at @MastercardFdn on Twitter.
This working paper discusses new theories of change in the microfinance industry, which suggest that the use of financial services for poor households results in resiliency. In effect, financial services help households anticipate, adapt to, and/or recover from the effects of shocks in a manner that protects their livelihoods, reduces chronic vulnerability, and facilitates growth.
To fill some of the gaps in knowledge about how financial services contribute to household resilience, CGAP engaged Freedom from Hunger to conduct a research project with two of its partners in rural Burkina Faso: le Réseau des Caisses Populaires du Burkina Faso (RCPB), a credit union that provides formal financial services, and the Office de Développement des Églises Évangéliques, a nongovernmental organization (NGO) that facilitates savings groups.