Posts

, , ,

From Uganda to Oxford

John Walugembe; Skoll Scholar 2016-17, social entrepreneur, and the Founder of Better Livelihoods in Uganda. John shares his candid story of how he came to Oxford to study his MBA.

“It is very painful to remember my daughter”, Maria said. “She was only five years old”. “I had a lot of hope in her”. “I wonder, what I could have done better”. “I was certainly lucky that Dr. Matovu was willing to attend to her. It was unfortunate however that it was too late!” This story by Maria – a distressed mother of two living in the Bwaise slum of Kampala, Uganda – is not very different from those of many others in Uganda and other developing countries. According to a recent report by Water Aid, only 30% of Ugandans have access to improved sanitation. The situation is even worse in urban poor communities, especially slums, where children collect water from contaminated gutters or ground water. The result of this is that at least two one million and five hundred children die annually, from diarrheal related illnesses.  The contamination primarily results from lack of proper disposal for excreta.

How does an organisation set up to support poor communities, survive off the very people it is supposed to assist. Indeed, it was and still is a dilemma!

When I founded the Better livelihoods Uganda, four years ago, I recognised that there was a need for a fundamental shift in the way water and sanitation issues are handled. Were communities, expecting so much from their governments that they failed to do for themselves, what was in their means to do? Were some Non-Governmental Organisations fostering a syndrome of dependency and raising the expectations of communities for handouts, to the extent that they exacerbated these problems? Which market approaches could be employed to ensure that communities contributed more to addressing these sanitation challenges. From the onset, I thought it prudent to make the organisation lean and limit its dependency on external financing. As you can imagine, this was no mean goal. How does an organisation set up to support poor communities, survive off the very people it is supposed to assist. Indeed, it was and still is a dilemma! However, we resolved that unlike the traditional NGO, we would seek to play a more facilitating role among the key stakeholders in the sanitation ecosystem.

We piloted our work in the Rwenzori region in western Uganda, particularly in the Municipalities of Fort-Portal, Kawenge, Kyegegwa and Kyenjojo. Using the diamond approach (a model first piloted by Waste Advisors in the Netherlands) we have been able to accelerate access to clean water and sanitation facilitating a well-functioning system of local stakeholders that facilitate the delivery of sustainable sanitation services. The bulk of our work has involved supporting entrepreneurs and other sanitation stakeholders to build more hygienic pit-latrines. As of last year, over 1400 direct jobs have been created in the region, the amount of fecal sludge collected had increased tenfold to 4,000,000 kilograms, the costs of accessing sanitation services have reduced from $30 to $5 and over 4,000 people have directly accessed sanitation services.

I thought it prudent that I acquire the skills to build and grow an organisation with a great vision, such as ours.

It would be great if I told you that after this, everything worked just fine and we have simply encountered success, upon success. Unfortunately, as someone whose academic background was not in business management, I thought it prudent that I acquire the skills to build and grow an organisation with a great vision, such as ours. An MBA looked an attractive option. The more I thought about it, the more counterintuitive it seemed. If I desire to engineer, social change, why not pursue a qualification in development? In the end, it only seemed logical that if our approach seeks to use market based approaches to tackle the sanitation challenge, there is no better preparation than an MBA from a business school with a focus on social entrepreneurship. In the end, the Oxford MBA looked the best fit for me.

Did I look at other business schools? Certainly! So, why the Oxford MBA? Well, the Oxford MBA was unique in a number of respects: First, the Oxford MBA is a rigorous one year programme. This was particularly attractive for me, as it would ensure that I get back to Uganda, in the shortest possible time to continue with my work.  Second, the Saïd Business School through the Skoll Centre, places a lot of emphasis on social entrepreneurship. For me, this was the ultimate attraction. Additionally, the possibility of social entrepreneurs, like myself, benefitting from the generous Skoll Scholarship, set the Oxford MBA apart.

Going forward, Better Livelihoods like other nonprofit organisations must look for new models of generating revenue streams while fulfilling its expanding mission. One possible strategy could be to set-up a social purpose business as an innovation for both the financial and operational sustainability of the organisation. The mission of this social venture could be to offer clean water, sanitation, health and hygiene solutions throughout Uganda, on a commercial basis.

In conclusion, I look forward to this year and taking advantage of all the opportunities that Oxford has to offer!

John was recently featured on the BBC World Service, Business Daily Show, where he sat on a panel discussion on Africa’s Social Entrepreneurs. Listen to the iPlayer recording.

, , ,

From the United States to Oxford

Skoll Scholar, MBA and above all, Engineer, Ashley Thomas, shares her story, not of HOW she got to be at Oxford, but WHO.

As I sit in a 150-year-old book shop (very new by Oxford standards) listening to Duncan Green, Oxfam GB’s chief strategic advisor, discuss his book How Change Happens, I’m again struck by how lucky I am to have ended up here, at Oxford, and as Skoll Scholar. In thinking through how I have managed to arrive at this moment, my instinct is to create a neat narrative: In 2008, as a freshly minted mechanical engineer, I moved to Ethiopia to work as a product designer at iDE, a NGO building social enterprises and agriculture value chains in Africa and Asia.  Since then I have worked as an engineer and innovation project manager for some of the best (in my humble opinion) social enterprises: Evidence Action and MKOPA solar, and dabbled in some policy work managing the DFID resource centre on climate and environment. Building on my experience in the water sector, I then read for an MSc in Water Science, Policy and Management prior to my MBA as part of the 1+1 programme at Oxford, in theory preparing me to solve the worlds’ water problems through my own social enterprise.

However, after listening to Green’s view of the non-linearity of change, I am tempted to reframe my story not as a narrative but as the summation of ripples in a web of complex relationships and interactions. If you can forgive my ramblings in non-linear narrative, I want to tell the story of my path here framed through the relationships that don’t make it onto a CV, and instead focus on the cast of characters that sent the right ripples into the network that guided me to this fantastic place.

Katherine McIntyre: My grandmother is the embodiment of tenacity. She was a flight controller in the Canadian Air Force during World War II, a travel writer in the USSR during the 1980’s, current record holder for the oldest person to do a zip line, and in few days, at 93 years old, will be travelling from Toronto to Oxford to see my MSc graduation. She has traveled to more than 45 countries, published in over 30 newspapers and journals and has founded 3 companies.  I can only aspire to emulate her singular focus, fearless independence, and her lifelong curiosity.

Left: Ashley Thomas, Right: Kirstie McIntyre

Left: Ashley Thomas, Right: Katherine McIntyre

Left: a young Kirstie McIntyre, Right: Kirstie McIntyre holds the current record holder for the oldest person to do a zip line

Left: a young Katherine McIntyre, Right: Katherine McIntyre holds the current record holder for the oldest person to do a zip line

Paul’s enabling, entrepreneurial approach strongly resonated and has become central to my own philosophy.

Paul Polak: I met Paul when I was nineteen, naïvely aspiring to fight global poverty, but I only knew about top-down traditional development organisations. From attending his lectures, receiving his mentorship through the Intentional Development Design Summit (IDDS), and ultimately collaborating at iDE, Paul introduced me to a new way of thinking. Instead of a charity approach, Paul showed me an untapped market of 1 billion people seeking to lift themselves out of poverty. Paul’s enabling, entrepreneurial approach strongly resonated and has become central to my own philosophy.

 

Paul Polak

Paul Polak

Carlos Machan: Carlos is one of the most creative product designers I have ever met. Born in rural Guatemala, his engineering knowledge is all self-taught. I met Carols in 2007 while he was an instructor on the International Development Design Summit at MIT and continued to work with him in Guatemala, where he taught me how to weld, design, and build my first water pump, the very skills that landed me my first job at iDE.

Carlos Machan

Carlos Machan

It was here, in front of this bonfire, where I first heard about the Skoll Scholarship, and began dreaming of becoming a Skoll Scholar

iDE Workshop and Engineering Team in Addis Ababa, Ethiopia: In Addis, our engineering team founded a workshop/office/guest house that was the backbone of our product development. It was also the location of many bonfires, beers, and late night pontification. It was here, in front of this bonfire, where I first heard about the Skoll Scholarship, and began dreaming of becoming a Skoll Scholar. It took 8 years of indecision, dreaming, and three failed attempts at the application before it became a reality.

iDE Workshop and Engineering Team in Addis Ababa, Ethiopia

iDE Workshop and Engineering Team in Addis Ababa, Ethiopia

MKOPA Engineering Team: This crew is one of the brightest, most driven, and friendliest teams I have ever worked with. From Eric, standing at 6’2” and with a sense of humor to match, to Berita, easily a foot shorter in stature, but making no compromises in heart or brains, this group of people embodies the types of teams I hope to continue to work with. They also solidified my desire to get an MBA. While they were begrudging the fact I’d “no longer be an engineer”, working with them made me realise that if I hope to run a company like MKOPA and a team like this one, I have a lot of learning left to do.

ashleymtblog-mkopa

MKOPA Team

While this is absolutely not an exclusive list, these are some of the threads in fabric of the story of my path here. From the nascent daydreams over Ethiopian bonfires to making the decision to come to Oxford after working on a manufacturing line in Dongguan, China, studying an MBA at Oxford through the Skoll Scholarship is the realisation of the network of friends, colleagues, places, and events that have guided me to this fantastic place.

All photos above were provided by Ashley Thomas.

Save

Save

Save

Save

,

The Story of Emerge 2016

The Skoll Centre held its eighth annual Emerge Conference from 12-13 November – a highlight in our annual social impact calendar.  Almost 500 attendees were present, including 65 speakers, and over 20 sessions were held ranging from workshops, to conversations, to speaker hosted lunches, and even an Oxford style debate. Emerge 2016 highlighted critical social and environmental issues, as well as cutting edge solutions. Its aim was simple – to inspire delegates and develop their understanding of global challenges.

With all the joy, inspiration, and excitement of Emerge 2016, there was an element of sadness to this year’s conference.  We were missing Emerge’s inspirational founder and late Director of the Skoll Centre, Pamela Hartigan, who passed away this summer. She designed much of the programme for 2016, and it was her wish that Emerge continue to highlight key trends within the social impact space.

go positively, she believed in you, and people like you. Her spirit lives on in this room and beyond

It was clear by the number of mentions, by both speakers and delegates, and tributes dotted around the conference, that Pamela touched the lives of so many. The opening plenary speaker, co-author, and friend to Pamela, John Elkington, made reference to the current social-climate, “in these tough times what would Pamela say? She would urge us to continue, to get on with it and make it work”. He closed his opening speech “go positively, she believed in you, and people like you. Her spirit lives on in this room and beyond”.

From left to right: Daniela Papi-Thornton, Ola Suliman, Baljeet Sandhu, Alexander Betts Photo by www.fisherstudios.co.uk

From left to right: Daniela Papi-Thornton, Ola Suliman, Baljeet Sandhu, Alexander Betts. Photo by www.fisherstudios.co.uk

And indeed her spirit did live on throughout the weekend’s sessions.  Some highlights of the programme included a session on Using Social Impact Media to Alleviate Conflict, which focused on how social impact media can be used to promote peacebuilding in conflict areas around the world; Using the Impact Gaps Canvas, which explored how this model can be used to understand the challenges and the solutions that have sprung up to address it; and One Year On: Revisiting the Refugee Crisis¸ which examined how the issue of forced migration has developed since Emerge 2015. This panel, in particular, was rich with content and well-received, bringing the perspective of migrants, grassroots activists and policy influencers to the table.

The opposition argued that there are issues which are simply too large and complex for private and social sector organisations to tackle alone

Left to right: Hangwi Muambadzi, Liam Black, Colleen Ebbitt, Kieron Boyle, Dr Shelly Batra, Allegra Day, Julian Coyne Photo by www.fisherstudios.co.uk

Left to right: Hangwi Muambadzi, Liam Black, Colleen Ebbitt, Kieron Boyle, Dr Shelly Batra, Allegra Day, Julian Coyne
Photo by www.fisherstudios.co.uk

This year’s Emerge Debate was held at the Blavatnik School of Government and was aptly titled: “This house believes government involvement constrains social innovation”. Dr Shelly Batra of Operation ASHA brought a touch of wit and charm in her speech for the proposition, jokingly questioning: “apathy, wastefulness and sloth, were these words created keeping govts in mind?” succinctly making her point that “social innovations have been strangled by governments in India”. However, Liam Black of Wavelength, dealt a knock out speech, noting that it’s “fashionable to kick government” and that we seem to take government policies for granted, even those laws that have made our lives safer. The opposition also argued that there are issues (like climate change) which are simply too large and complex for private and social sector organisations to tackle alone, and that policy is a necessity to tackling these effectively. Kieron Boyle, a first-time debater, closed with a strong argument, putting forward that “we need to help government be more socially innovative”. After an audience vote, the motion was rejected – in the eyes of our Emerge delegates; government involvement does not constrain social innovation.

Crisis Cafe - Performance by Oxford Imps Photo by www.fisherstudios.co.uk

Crisis Cafe – Performance by Oxford Imps
Photo by www.fisherstudios.co.uk

To wind down the first day, delegates and speakers alike headed to Crisis Café for dinner, networking, and Emerge Spotlight entertainment. This year’s Emerge Spotlight was super-charged! Post-supper energy from the Oxford Imps, an improv troop, had the crowd roaring with laughter at their spontaneous scenes. The Imps were followed by impromptu performances from Emerge delegates themselves, and Oxford MBA graduate, Denise Hearn, closed the night with an intimate set of rock and country covers.

The sun was finally shining on Sunday morning, and as in years past, the second day of Emerge opened with the Mustard Seed Pitch Competition. Eight social start-ups pitched to win investment from Tribe Impact Capital. There was stiff competition, but ultimately diabetes prevention start-up Our Path came out on top, and were offered a £5000 prize, which is convertible to equity by Tribe Impact Capital if they raise further funding. Our Emerge delegates gave  the audience choice award to BubbleNutWash, who produce and sell fairly traded, environmentally friendly soap nuts. Both companies will have the opportunity to meet mentors and investors from Mustard Seed’s network in a greenhouse day in London.

Pail Lindley, Founder of Ella's Kitchen Photo by www.fisherstudios.co.uk

Pail Lindley, Founder of Ella’s Kitchen
Photo by www.fisherstudios.co.uk

The Sunday keynote was delivered by entrepreneur Paul Lindley, founder of Ella’s Kitchen and Paddy’s Bathroom. Paul, proudly wearing his B-Corp UK t-shirt, talked about values and people in business. Ella’s Kitchen currently turns over €100M a year, and he put that success down to four key factors:

  1. Values based business
  2. Consumer focused
  3. An awesome team
  4. Actively finding ways to deepen consumer’s trust

Paul is an advocate for business as a force for good, and he believes profit making businesses can change the world. We should also mention that Paul should probably win the award for most endearing and creative PowerPoint; he engaged the audience through his entire 90 slide presentation, and had them laughing at video clips from his playful campaigns. His speech affirmed that we all, as individuals, have the power to make small changes each and every day in the way we choose to consume. #Bethechange!

The final keynote was delivered by founder of MyBnk, Lily Lapenna. MyBnk is a financial education initiative designed to equip young people with the knowledge they need to be in control of their money. Lily took us through her impact journey, and where she is headed next. Her charismatic approach had the audience shouting out their very own tagline after she disclosed her own as “Nigel Farage, Donald Trump, I don’t want to run away from you, I don’t want to move to Canada. I want to coach you!”

Lily Lapenna - Founder and Chair of MyBnk Photo by www.fisherstudios.co.uk

Lily Lapenna – Founder and Chair of MyBnk
Photo by www.fisherstudios.co.uk

Daniela Papi-Thornton (with newborn baby Skye Thornton strapped to her torso) closed the weekend with some parting words of wisdom and top tips for the audience:

  • Work for an organisation where there are people who will mentor you and where they take staff learning opportunities seriously.
  • Find problems to care about. You won’t find your calling by looking for “solutions” – first you need to find a problem you really care about, and as you begin to understand it, you will start to gain the perspective from which solutions can emerge.
  • Connect and network! Don’t just walk out of here asking for help from someone – instead offer your help TO someone. Connect them with someone you know who might help them get them on their impact journey, share resources, or give other support! (Check out our Collaboration Clothesline for connections)
  • Gain skills! Ask yourself “What can I learn from those around me, from my bosses, from our organisational systems?” Even if you don’t think your current job is high impact, there are certainly things you can learn!
  • Join us at Emerge next year!

And with that, it was all over; inspiration, challenge, and rejuvenation to last until Emerge 2017.

We’ll see you next time!

Feature image by www.fisherstudios.co.uk

To see more photos from Emerge 2016, head to our Flickr account!

FestSave

Save

Save

Save

Save

Save

Save

, ,

From Guadalajara to Oxford

Macarena Hernandez de Obeso is passionate about the economic opportunity for Mexico’s deprived communities. She is also our 2016-17 Skoll Scholar and Oxford MBA student. Her journey from Guadalajara started with a simple Skype call. Macarena shares the story.

Two years ago I had the luck to have a conversation by Skype with Pamela Hartigan. At that moment I had no idea this call will change my life to the point that today I’m writing this blog from Saïd Business School, at the University of Oxford, 5,605 miles away from the place I was born and raised, Guadalajara, Mexico.

Macerena

Macerena joined Prospera in 2011, the first social enterprise in Guadalajara, Mexico.

 

One would think that it is almost impossible to build a social enterprise in a conservative region, in a country that has not been growing strongly for the past 30 years. But, in spite of all this I have not allowed the circumstances to define what I can or cannot achieve. To the point that in 2014, Prospera, the social enterprise I was leading, was recognised as one of the top 10 favourite social enterprises in Mexico, according to Forbes, and the best social enterprise in Mexico according to the Suzie Bank UBS.

Prospera became my passion. But, passion alone gets you nowhere.

My unconformity and the pursuit of challenge and intellectual growth led me to join the team of Gabriela Enrigue to build Prospera, the first social enterprise in Guadalajara. At that moment, I did not know anything about entrepreneurship or social enterprises. But a hunch and a desire to learn made me spend all my time building Prospera from the beginning. At Prospera, our mission is to serve single moms in poor communities who start small businesses from home. Our vision is to disrupt the entrenched male-dominated social structures that have been in place for the past 500 years in Mexico. We have trained more than 7,500 women and increased their incomes eight times. Prospera became my passion. But, passion alone gets you nowhere.

Generating opportunities for women is a profound reason that deserves my time and work. But if I fail to better combine the social mission with a sustainable business model, I will be designing solutions that nobody will pay for and the impact will never scale. I came to this awareness after I led a Prospera project as part of a Fund developed by Alsea Foundation and Starbucks Mexico. This project changed the way I see the world.

Startbuck Project - Prospera

Alsea Foundation and Starbucks Mexico Project at Prospera [Photo source: Prospera]

The project’s goal was to add a productivity component to Alsea Foundation. It was the first project of this kind done in Latin America and we expected it to be scaled to six more countries. We trained 33 poor, single moms from one marginalised slum around Mexico City. They were recipients of philanthropic aid and the purpose of the project I designed was aimed at transforming them into small vendors at Starbucks. The women produced 3,300 customized notebooks that were then sold in 80 Starbucks. These women improved their income by 700%. Despite that the notebooks were sold to Starbucks consumers in less than a month, Starbucks only made this one purchase. Why? Neither the notebooks sales nor the productivity of these women were related the Starbucks core business model and the Foundation could not drive the corporate goals.

I decided to start looking for MBA programmes that would help me design business to solve the most challenging social problems that we face today.

As a result of this project I have been studying start-up business methodologies and working on the development of Prospera’s business model. I want to generate benefit for both the community and enterprises. If an enterprise increases income while solving social problems, they are willing to pay for this solution. That’s why two years ago I decided to start looking for MBA programmes that would help me design business to solve the most challenging social problems that we face today.

Talking with Pamela Hartigan not only helped me to understand how the Skoll Centre supports social entrepreneurs inside Saïd Business School, but she also made me believe that one day I could become an Oxford MBA student. The day has come I am grateful and ready for the challenge.

Save

Save

Save

Save

, , ,

From Bangladesh to Oxford

Not only is Ahmed Abu Bakr a Skoll Scholar and MBA student at Saïd Business School, he is also the former Head of Product & Experience at Jeeon LLC in Bangladesh. He tells his story of what brought him to Oxford.

“You are now a student at the University of Oxford.” -Induction day, Dean Peter Tufano, Said Business School, University of Oxford

Sitting in a room of 328 fresh MBA students, captivated by words of inspiration and felicitations – that was the first time that it TRULY hit me.

I was at one of the finest institutions of learning, surrounded by the best and brightest in the world – a place where world leaders were made. I was finally at Oxford.

I knew that giving back was a responsibility, not a choice.

My journey to Oxford really started straight out of college in 2012. My aspiration was to start my own venture. I also knew very early on, that I wanted my career to benefit the neglected and the marginalised. In the context of Bangladesh, I had enjoyed a privileged life and somewhere in my heart, I knew that giving back was a responsibility, not a choice.

I considered the MBA back then, rather naively in retrospect, as a possible degree that would help me understand business and prepare me to launch my own. And my sights were set on the very best of schools. Why? Back then it was about the prestige. But of course, an MBA without work experience was not going to be of much use. And hence I joined mPower Social Enterprises a tech consultancy working with the likes of USAID, Oxfam, Save the Children and so forth, to amplify their impact through technology.

My reasons for joining mPower were really two fold. Firstly, it was about working in a young company to understand the challenges of a startup. Secondly, and arguably more importantly, it was about working directly with two Harvard graduates (and founders) and having them as mentors that would shape me professionally and guide me into getting into one of the top schools in the world.

But six months into mPower, I was part of the founding team of a project that would eventually spin off into a company in its own right Jeeon. Jeeon connects rural patients with qualified doctors in the city, right from the village bazaars. We do this by equipping intermediaries (rural drug shop owners in village bazaars) with the training and technology necessary to collect comprehensive medical data about rural patients using our custom android app. This data is seen by our doctors in our city office, and after a thorough conversation between patient and doctor, facilitated by the intermediary, patients receive reliable medical advice, prescriptions and recommendations.

Ahmed is the former Head of Product & Experience at Jeeon LLC

Ahmed is the former Head of Product & Experience at Jeeon LLC

It has taken us three years to fine tune the model so that it is operationally self-sustaining. We started with a team of five. There were days when it was just me running to different people at mPower (mPower incubated Jeeon for two years) to get things done. I played a myriad of roles- from product design to tech management, to business modelling, to team building, to operations, and strategy. It has been a tremendous experience, where I learned and accomplished more than I had ever dreamed off!

Today we have raised over a million dollars in investment, have a 20 person team (excluding doctors and rural intermediaries), and are expecting to serve over 50,000 patients in 2017. The vision however, is much grander. We intend to be the first point of contact for all rural patients, for all matters relating to healthcare and wellbeing – much like Google for the web, we intend to be the trusted navigator for all healthcare services in rural Bangladesh.

…after much deliberation, I also realised that the needs of Jeeon were changing significantly…I was definitely not equipped with the skills, network, or visionary perspective that would be necessary to lead the system level transformation we aim for…

Amidst all of this, taking a year off for the MBA really was one of the most difficult decisions I have ever had to make. I was already responsible for something that would deeply affect millions of people in Bangladesh in the coming years. I was part of a stellar team of committed people focused on transforming healthcare on a nationwide scale. Jeeon was about to finally take flight, and the thought of stepping away was excruciating. But after much deliberation, I also realised that the needs of Jeeon were changing significantly. I had played my role well in prototyping and experimenting our way to a business viable service model. I had guided strategy and played a key supportive role in building the team and culture of the company. But I was definitely not equipped with the skills, network, or visionary perspective that would be necessary to lead the system level transformation we aim for at Jeeon.

And hence I decided to pursue the MBA at Oxford Saïd – for its explicit focus on social entrepreneurship, and in no small part for the Skoll Centre for Social Entrepreneurship – but primarily because at Oxford, I expect to develop the transformative thinking that I will need in the coming years. It is the end of one chapter in my life, and the beginning of another.

And I am here.

Save

Save

Save

Save

P2P Lending in the Balkans

Authors: Misa Zivic, viagra buy  Dushan Neshovski,  Shinez Chalabi

Good ideas tend to cross borders quite easily. This is especially the case with technology. We can easily observe the convergence of new technologies across borders in almost any part of the world. And the reason is simple – the convergence of technologies is empowered by technology itself. Furthermore, technological breakthroughs increase productivity while lowering costs and this quality makes them easily adoptable by new geographies. One such technological breakthrough is FinTech – which is simply to say technologically empowered financial services. Just to give you an idea, technology today can do most of what banks or other financial service institutions do. A basic example is balancing your check book online instead of waiting in line in a bank.

The Power of FinTech

The idea of technology powered financial services has the main quality of a technological breakthrough – it increases productivity while lowering costs. And this is just the tip of the iceberg. FinTech is literally revolutionizing finance – from new scoring models, to giving opportunity to regular people to take part in what only Investment Banks were allowed to partake. As such it has been spreading geographically on exponential basis. Every day a new FinTech product becomes available that changes the way we interact with finance. Everyone, from the general public to investors are hooked on this new industry. However, if you look the map of Europe, there is one region that has had zero activity in the FinTech space. This is the Western Balkans, or more precisely, Ex-Yugoslavia countries. Two members of our team being born and living in the Western Balkans their entire lives found it curious why this phenomenon, that is positively influencing the rest of the world, has overlooked this geography. With the help of the Skoll Centre of Social Entrepreneurship and the Said Business School, the team spent six months in Serbia, conducting in-depth analysis of the Serbian financial market and its readiness to accept FinTech innovations, specifically P2P lending.

P2P Lending (blog image)Our Research

The research focused on the P2P Lending industry as a global phenomenon, the history and the current state of the financial industry in the Balkans, the ways P2P Lending can be introduced in the region, the barriers that have kept it out, and the benefits that these countries can have from it. During the six months the team did hands on research, engaged with some key stakeholders in the Serbian finance sector (such as banking professionals, government officials, high net-worth individuals, etc.), and took part in the LendIt Conference in London, the largest P2P conference in the world where it had chance to meet industry experts from all around the world. The key findings will be outlined bellow, accompanied with an infographic for the more visual readers.

Global P2P Lending Findings

P2P lending is a global phenomenon that has experienced enormous growth over the past five years. It can be established as one of several operating models all of which have a more cost efficient structure than traditional banking. The regulation for P2P lending varies across different countries. Finally, P2P lending offers many benefits including: no inherited systematic risk, access to finance, and it Is a new asset class.

Analysis of the financial sector in the Balkans

The financial sector in the Balkans remains to be hugely underdeveloped and it lags behind the financial sectors in developed countries. Commercial banking is the only developed sector in the financial industry in the Balkans. The key challenges to the development of the financial industry in the Balkans are:

  • Low level of saving
  • Conservative lending by commercial banks
  • High borrowing costs and low deposit returns
  • The legislation in the financial sector in the Balkans is set up to protect the banking industry

P2P Lending in Serbia

Given the local landscape and the key factors to P2P lending two operational models can be set up in Serbia

  • Partnership with a bank
  • Fee based model

The revenue model for P2P Lending in Serbia should not be much different than that in the US or the UK. The borrowers market can be split in consumer and business, while the consumer market consists of all the household loans issued by commercial banks, in addition to all the loans not issued due to conservative banking. The business market should focus on working capital financing – invoice trading. The research has shown that the following are the essential areas of activity that must be performed well if P2P lending is to be introduced in Serbia:

  • Credit risk modelling
  • The matter of trust
  • Education
  • Strategic partners

Overall, our view of the market is a positive one and our assessment is that there is space for the FinTech industry. We expect that some form of alternative finance will emerge in the Western Balkans in the near future, and in expectation of this we will continue our work on bringing P2P lending in the region.