2008 CGAP Microfinance Photo Contest opens

July 23, 2008    

Two photographs, two very different images of microfinance. A group of women in Birbhum, West Bengal, embroider an emerald green swatch of fabric. They’ve taken out a group loan to buy sewing supplies to support their microenterprise. It’s a timeless image that speaks to the “classic” model of microfinance: group lending to women, where poor people with little or no collateral get loans to finance their small businesses.

Now, photo two: A Muslim man is talking on his mobile phone. He’s from Bangladesh – home of the microcredit movement. But this image speaks to a whole new world of microfinance, a world of financial services opening up rapidly through mobile phones, new technologies, and new banks and service companies - IBM, Microsoft, Citi, Deutsche, J.P.Morgan, Morgan Stanley - competing to serve the low end of the market.

Both are the reality. So is the image of Clara Hernández and her husband, Marcelino, store-owners in Xotla, Mexico and clients of ACCION International. After Marcelino lost his job at a local factory, Clara took out a loan to start a vegetable stand. Now on their third loan, they are using microfinance to expand the business. Latin America has seen one of the most rapidly-developing commercial markets in microfinance. And Mexico has recently witnessed the controversial Compartamos IPO, sparking a debate throughout the microfinance industry about the emerging issues and tradeoffs as commercial microfinance takes off at a giddying pace in some markets.

Across the globe - in Peru, the Philippines, Laos, Benin, Senegal, in Sudan, Afghanistan and Syria, throughout Eastern Europe, Latin America and South Asia, it’s a dynamic time for microfinance. This is the reality that takes expression in striking images from the CGAP Microfinance Photography Contest. The photographs “bear witness to the extraordinary capacity for microfinance to transform lives”, says Elizabeth Littlefield, CGAP CEO. “They capture the broad variations in microfinance throughout the world, and create a visual narrative for microfinance today.”

The microfinance industry is developing at such a pace, says Littlefield, that the reality is often surprising. After 30 years, traditional microfinance has reached about 77 million households. But new delivery methodologies – combining new technologies with local agents for cash – could mean hundreds of millions of people reached within just a few years. Take the Philippines, where there are about 1000 bank branches, 7,000 ATMs, and 25,000 Point of Sale terminals. That adds up to about 33,000 points where people can access an existing bank account. Compare that to Globe and SMART, two mobile phone companies, which have 1.1 million merchants selling mobile airtime. The potential for access created by these new channels means we may need to rethink the whole picture of how the financial system will best serve poor people: the delivery mechanisms, the business models, and the regulatory issues.

"The promise of using technology channels to transform financial systems and bring banking services out of the bank branches and into villages and barrios is real and exciting. But going beyond simple payments services will take a concerted effort to overcome regulatory challenges, business model challenges, and cultural hurdles."

CGAP has just opened entries for this year’s CGAP Microfinance Photo Contest. The winning images from the Contest’s first two years are currently showing in London at Citi Centre, Canary Wharf, through 31st August.

The more than 1500 photos submitted to CGAP by both amateur and professional photographers from every region of the world, were judged on their technical skill and artistic merit, as well as their representation of microfinance. An exhibition brochure is available from CGAP.