Financial Services

Overview

Financial services programs work with regulators, financial institutions, and supporting NGOs and CBOs, to design and deliver financial services and education that respond to the savings, borrowing, and risk mitigation needs of young clients. Inclusive finance can play a critical role in enabling youth to invest in employment or educational opportunities, but is often limited by legal hurdles, lack of collateral, and lack of business experience and financial know-how.

Where are we now?

The youth-inclusive financial services (YFS) sector is working to engage policymakers, donors, financial service providers, NGOs, and youth at the macro and micro levels to experiment with new or adapted financial services that meet the needs of youth, while creating business opportunities for the private sector. At the macro level, efforts are focusing on regulators and policymakers to advocate for youth-friendly banking policies that would allow youth more independent access to a range of financial services, and to develop appropriate youth-inclusive client protection principles. At the micro level, financial institutions are researching the youth market to better understand their financial behaviors and needs; and to pilot financial products and services that promise to meet a young person’s specific financial goals as well as present a future business opportunity for financial service providers (FSPs).

Trends and Best Practices

  • Regulatory constraints to serving younger clients require an FSP to think creatively, i.e. finding alternatives to formal identification and minimum age requirements.
  • To appropriately serve young people, practitioners must first use youth-friendly market research techniques to better understand their financial habits and preferences.
  • Youth financial service needs grow and change as they do. Adolescents only need access to savings services, whereas young adults can use a full range of services. Their needs also differ based on geography, education, marital status and employment. FSPs should consider which market segment they can best serve given their experience and assessment of institutional partnerships.
  • Youth financial products may only differ slightly from those offered to adults, including low or no minimum balance savings accounts and alternative guarantees for credit.
  • The major product differences lie in marketing (i.e. attractive color schemes/special logos and tailored messages for young people) and delivery mechanisms (i.e. thinking outside the branch) and in the accompanying non-financial services (i.e. financial education and entrepreneurship) critical for building a young person’s capacity to save, manage their money, and generate income.
  • YFS are often best delivered in partnership, enabling the FSP to focus on the financial product while partner NGOs or government agencies address the financial education and entrepreneurship needs of young people.

 

Financial Services: Blogs

USAID Awards YouthPower, an Agency-Wide Mechanism to Achieve Positive Youth Outcomes

Over the past few months, USAID Bureaus for Global Health (GH); Economic Growth, Education, and Environment (E3); and Democracy, Conflict, and Humanitarian Assistance (DCHA) announced the awards of the long-awaited YouthPower: Implementation and YouthPower: Evidence and Evaluation contracts.

Five Things Any Youth Savings Program Needs

Originally posted by CGAP on May 20, 2015.

Less Politics, More Economics: Getting Real About Rural Youth in the Middle East and North Africa

In recent weeks, unprecedented acts of cruelty and violence have dominated world headlines in the Middle East and North Africa (MENA) countries where we work, including Tunisia[i] and Yemen.[ii]  While politics and religion are dissected as drivers of terrorism, the underlying economic cause and effect seems to receive far less attention and debate.[iii] For MENA’s youth, the reality is that economics

Event Resources: Economic Strengthening for Orphans and Vulnerable Children: A Learning Symposium

On May 6th, 2015, industry leaders met for a stock-taking discussion on Economic Strengthening for Orphans and Vulnerable Children. The event was jointly organized by The SEEP Network and the International Rescue Committee as part of the Accelerated Strategies for Practical Innovation & Research in Economic Strengthening (ASPIRES) project, led by FHI 360 in a consortium of 20 members, working to promote evidence-based state-of-the-art approaches to promote high quality economic strengthening programs for orphans and vulnerable children.

Resource Type: 
Presentation

June E-Bulletin: Stepping Up Service Delivery for Youth

Making Cents International offers this newsletter for the donors, policy makers, corporations, researchers, implementers and youth leaders increasing the scale, sustainability and effectiveness of youth economic inclusion programming. 

Resource Type: 
Toolkit

Youth Briefing Sheet

Fast Facts

·         Youth between the ages of 15-24 represent approximately 18% of the global population,
          nearly 1.2 billion people

·         1.2 billion are between the ages of 10 and 19

·         87% of youth live in developing countries

·         81 million of the 620 million economically active youth ages 15 to 24 globally, or 13%, were unemployed in
          2009

Resource Type: 
Paper