Bob Annibale is the Global Director of Inclusive Finance for Citigroup and leads their partnerships with global, national, and local organizations to support inclusive finance and community development through economic empowerment. He also leads Citi’s commercial relationships with microfinance financial institutions, corporations, investors, and municipalities, working across Citi’s businesses and geographies to expand access to financial services in underserved communities. We caught up with him on the sidelines of the Skoll World Forum to hear more about Citi’s partnerships with microfinance institutions and why financial inclusion is so critical for large-scale social change. We revisit our conversation with Bob as global leaders gather at the UN General Assembly Assemble this week to take stock of progress against the Sustainable Development Goals and the financing required to achieve them.
Equitable Access
Many of us have access to savings tools and credit tools, and sometimes we have insurance tools, and we use those tools to manage the ups and downs of our lives. Those tools help us meet goals, smooth out tough times, prepare for the unexpected. We all have very similar needs, but we don’t all have similar access to these tools.
What drives my interest is financial inclusion. People have needs for all sorts of access: to water, to healthcare, to education. The absence of inclusive financial systems means the most vulnerable people have an even tougher road with fewer options – they are left to rely on products and services that are more expensive, lower quality, less convenient and even predatory. Being excluded from financial services limits your opportunities. If the minister of finance or a poor woman in Bangladesh can access the same national mobile services, shouldn’t they have access to a common formal financial system?
Look at the road system, the infrastructure that we built that connects our communities. In many ways that gives us more access to common opportunities—shared facilities create a shared experience. Professor Yunus and many others around the world gave ordinary people access to services that most of us take for granted. Whether it’s about saving safely for a goal, or it’s about credit for a small enterprise or for a home, or for many other goals people have, it’s so important that we have equitable access.
Going the Last Mile
Professor Yunus began Grameen Bank in Chittagong in Bangladesh, and it surprises people, but there’s a Citibank in Chittagong. We understand Chittagong, but we couldn’t reach that last mile ourselves. But we are able work with people who can — and we can help them to do more. We work with 120 microfinance institutions and inclusive businesses in over 40 countries as clients and partners. These are organizations that have demonstrated themselves to be sustainable providers of services to the poor.
Those kinds of institutions have moved beyond philanthropy. They want partnership. For example, Citi has partnered with Accion International for 30 years. Some years ago, Accion was largely a network of microfinance banks around the world, most of which started out as NGOs and then become banks. Citi began working with Accion only philanthropically making grants to build capacity of those institutions. We continue to do that today; and as Accion has broadened their strategy for expanding access, they are investing and supporting innovative early stage fin-tech companies, and exploring new lending models. Citi and Accion remain committed to research, exploring best models and challenges for expanding financial access through our commitment to the Center for Financial Inclusion.
We built a loan guarantee program almost 20 years ago with Accion. Ever since we’ve worked with their members all over the world. I think of them as fellow financial institutions with a real specialization to serve lower income people, rural communities, those that the traditional banks just don’t get to. Philanthropy is important, but it’s not enough for financial institutions to give philanthropically if we don’t also work to expand access.
Many other non-microfinance institutions who are doing sustainable trade finance and working with small producers in agricultural areas are looking to get to scale or eliminate this risk. That’s where we fit in. Not because we have knowledge around that last mile agribusiness or cooperatives. That’s their expertise, but we can help connect them as an institution to global or national markets, and since we are local in all these countries, we can do things in local currency, in local languages, following local law.
We’ve even taken nonprofits to the capital markets in their local market by issuing bonds. If we can demonstrate the strength of that organization as they’ve convinced us, to other investors, they should be able to raise funding just as other institutions do. Sometimes the social investors say these organizations are too small, they’re not really conforming. That’s when we work with them to present themselves to investors. When it comes to organizations trying to expand and grow and deliver services as many social enterprises are, we have something to add.
And we’ve been able to leverage our scale and technical expertise in other ways, working with new payments platforms that dramatically expand outreach for small payments, reducing the time, cost and risk of transacting in cash. Again, this is achieved through partnerships with those who can reach the last mile for consumers, such as a chain of local convenience stores or a large mobile operator.
Systems Change
Bankers aren’t generally thought of as social activists, but bankers come from all kinds of past lives. My work combines social activism and service delivery with the need to be sustainable in a world where it’s a challenge to get funding and financing to do creative things with a social outcome. I’ve felt privileged being able to live in communities where I had opportunities, I had clean water, I had education, I had access to healthcare, but I was very conscious of those who didn’t.
People sometimes ask me what world I would like to create or find myself in. It’s a world where there’s equal opportunity. That means we need to advance concepts like universal access. I believe most people will do much better with a certain amount of security and access. When someone struggles over those most basic elements of life, their potential is very limited. There’s no reason we should allow that as a society or as an industry.
Where you do have almost universal access to healthcare, universal access to utilities and services? Look at the Scandinavian nations. It took building national policies, legislation, and national institutions to get there. Where that hasn’t happened, we see whole communities left out. There is a role for the state in all of this, just as there is a role for industry and the nonprofit sector to work together. What we need is systems change.
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“Ooty market #1” by M@hieu is licensed under CC BY-NC-ND 2.0
