alternatives to the grant culture: sustainable finance for local employment development christophe...
TRANSCRIPT
Alternatives to the grant culture: sustainable finance for local employment development
Christophe Guene
Juan-les-Pins, June 2005
sofi
Factors of non-sustainability of local economic initiatives
Project levelpoor management =>…poor market access =>…poor access to finance =>…
Regional factors
-regional financial exclusion / leakage-poor access to “distribution networks”-volatile markets
Sector factors
-new sector-low profit sector-volatile (risky) sector-complex sector
Societal & Envir. factors
- globalisation of production and distribution networks- level of fear (lack of confidence & trust)- increasing individualism- eco-liabilities & “accidents”
Gvt factors
sofi
Credit and Sustainability introducing methodological discipline
Do you know your market, your source of income? Do you master your figures? (proper accounting?) Do you have a plan for your business? Who is responsible?
=> Is your activity going to be sustainable? cultivating a creative culture
A focus on the future Negotiation relationship
sofi
Community Banking
The rise of "new social banking" in Europe
Microcredit
EcoBankingMutual Banking
& Social Economy Finance
Mutual Credit
sofi
"new social banking" in Europe (1):Mutual and Social Economy Bkg
Mutual Banking& Social Economy
Finance
What: 1. savings & credit mutuals(Credit unions, Savings & credit associations, Coop banks)2. credit coops (Mag, Credal…),Specialised coop banks (BFS…)
Targets : 1. members (local individuals)2. associative sectors, social sectors (creches, hospitals…), inclusion companies, worker cooperatives…
Sustainability contribution: 1. Access though small scale credits+ local re-investment, - 2. Professionalisation, access through specialisation
sofi
"new social banking " in Europe (2):Eco-Banking & Finance
EcoBanking
What: eco-funds, eco-banks,=> Ethical banks
Other Examples: ABS (Ch), Banca Etica (It), Merkur (Dk)…
Targets: organic agriculture, renewable energies, eco-businesses+ women initiatives, culture initiatives, participative enterprisesAssociative sectors, schools, social & eco-housing
Pioneers: Gemeinschaftsbank (De), Triodos Bank (NL), Ökobank (De)
Sustainability contribution: Access through small credits,Specialisation, identification of social capital + creation of markets
sofi
Community Banking
"new social banking " in Europe (3):Community Banking
Pioneering example: South Shore Bank (Chicago)European Examples: ART (Birmingham), Caisse Solidaire du Nord (Lille-Roubais)
Targets: local enterprises, inclusion companies, Starting micro-enterprises, renewable energies Cultural projects…
Sustainability contribution: Access through small credits, local re-investment, specialisation + contribution to professionalisation
sofi
"new social banking " in Europe (4):Micro-Finance
Microcredit
Pioneering example: Grameen Bank (Bangladesh)European examples: Adie (Fr), Aspire (Belfast), WWB (Sp),Kvinnebanken (No), Fundusz Mikro (Pol)…Targets: unemployed, individual entrepreneurs, existing micro-enterprisesSustainability contribution: Access though very small loans,Finnavial innovation + contributes to professionalisation
sofi
"new social banking " in Europe (5):Mutual Credit
Mutual Credit
What: clearing systems, time banks, barter schemes, scrip, Interest free banks (JAK, Sw)
sofi
Dealing with a small misunderstanding
The limits of (social) finance is that it is pre-finance, ...
...it does not replace subsidies
sofi
How do they contribute to sustainable local employment?
They professionalise They give access to finance
HOW? By being not-for-profit primarily + Through Financial innovation + by keeping money local + through specialisation + by recognising social capital =>
They create (access to) markets
sofi
Is this sustainable? E.g. a micro-finance organisation
50% of costs covered by interest on credits and other service charges to the clients
50% of other external funding !
sofi
sofi money & banking for Society
Rue H. Chomé, 16
B-1030 Brussels, Belgium
Tel +32-(0)2-762 14 31
www.sofi.be