Today’s Revolutionary:
Kathrine Switzer


Kathrine Switzer (b.January 5, 1947) was the first woman to register (as “K.V. Switzer”) and run in the Boston Marathon, in 1967. (Other women had jumped in previous marathons and completed it, but without registering and without numbers on their jerseys). Most of the other runners in the 1967 race were happy to run with a woman, and the race organizers did nothing, until about mile 4, when officials, led by Jock Semple, tried to stop her. “Get the hell out of my race and give me those numbers,” cried Mr. Semple. Kathrine’s boyfriend, also running the race, shielded her, and she continued and finished.

Switzer has since pointed out that nowhere in the rules was there any provision that runners had to men only. It was just assumed. In an case, the rules were revised five years later, in 1972, explicitly allowing women, and Mr. Semple, who had tried to stop her before, was instrumental in having the rules changed.

 

  

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Savings Groups are catching on in Europe and North America.

Follow this movement, and maybe get involved yourself.

Start by reading the Northern Lights page of Savings Revolution.

Then, if you like, contact us below, and we can talk about how you can form your own groups. We’ll put you in touch with someone who can help you do that!

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    Favorite Sites

    Here are some other sites that Kim and Paul read, that we think you might enjoy.


     

    Winkomun: This is a site of the ACAF network, mostly in Europe. They are doing great work and are Northern Lights leaders. Nice video where various members answer the question, “What is a Group”? Also available in español, català, and français. Where else can you get news about Savings Groups in Catalan?

    The SEEP Savings Led Working Group site. Congratulations to SEEP for putting together this comprehensive, easily accessible go-to site on savings groups. Check out their library, their report on outreach by country, and lots of other goodies.

    Village Finance Blog. Brett Hudson Matthew’s thoughtful posts are grounded in an understanding of oral cultures, history, and social dynamics. Recommended for anyone trying to understand what’s really happening in savings groups. 

    Institute for Money, Technology and Financial Inclusion at UC Irvine. “Its mission is to support research on money and technology among the world’s poorest people. We seek to create a community of practice and inquiry into the everyday uses and meanings of money, as well as … technological infrastructures”. ‘Nuff said.

    David Roodman’s Microfinance Open Book Blog. David Roodman combines intelligence, honesty, and a sense of humor. He attempts to bring intellectual rigor to the analysis of the impact of financial services, and isn’t afraid to ruffle a few feathers in the process.

    Clean Air, Bright Light. This site by Savings Revolution co-founder Paul Rippey contains useful information about lessons learned in using savings groups to promote clean lighting. Still in development but check it out anyway!

    Center for Financial Inclusion. CFI supports traditional microfinance to become more client friendly, more inclusive, and generally smarter. They have a long-term vision for the sector, and the blog attracts many good writers and thoughtful comments.

    Nanci Lee’s blog. Nanci Lee’s eclectic site includes Savings Groups, and also poetry, travel, links to interesting successes around the world, nature, art, women’s rights, and transformation. A very personal blog, and worth reading.

     

     

     

     

     

     

    Financial Promise for the Poor 

    Financial Promise for the Poor: How Groups Bulld Microsavings is your go-to book on savings groups. Its contributors are authors you often read in this blog. It covers current innovations in microsavings happening around the world.

    Also, don’t miss…

    Savings Groups at the Frontier, the book inspired by the 2011 Savings Group Summit!

    Buy in UK or US.

    Search Savings Revolution

     
     
     
     

    Over the last twenty years, many people have become interested in helping poor people around the world get good financial services. Mohammed Yunus and the institution he founded, the Grameen Bank in Bangladesh, won a Noble Prize in 2006 for helping start a movement that has brought financial services to millions around the world. 

    Banks and microfinance institutions are one way to bring financial series to the poor. Savings Groups, managed by the members and based on savings rather than debt, are another solution. In fact, we think they’re such a good solution that they really are revolutionary.

    Savings Groups are self-selected groups of 15 to 30 women and men who get together to save and borrow. Rather than go into debt to an external institution, they manage their own savings through transparent procedures and all the money they earn through interest on loans stays in their village, and in their group.

    This seven-minute video is a great short introduction to savings groups:

    A number of international non-profit organizations work with local partners to train people in villages and cities in how to manage their own savings groups. There are now over five million savings group members in Africa alone, and the movement is also growing in Asia and Latin America. (There are even a few groups in Europe and North America).

    Savings Revolution is designed to help you learn more about Savings Groups, and to get involved with the most exciting new approach to bringing safe financial services to people around the world.

    Saturday
    Oct152011

    « Staked to the Ground in a Savings Junkyard »

    A Junkyard of Savings OptionsOn the whole, banking for the poor disappoints. With better access to banks, low-income people might enjoy the confidentiality and security of formal financial services right next to the informal services of their mattress, local lottery or nosey neighbor. As it stands, the poor are financially staked to the ground.  They can’t free themselves from the mattress, the lottery, or the neighbor. They have nowhere to go.

    Some are lucky enough to belong to well-run savings groups. But these groups rarely meet short-term needs for withdrawal or long-term needs of retirement*. Members are stuck as savings tweens if groups are their only option.

    One reason many are trapped in a savings junkyard is the mountain of paperwork currently required for even mundane banking activities. You’ve seen it. We’ve all seen it. Much of this hassle results from mandates imposed on banks by regulators attempting to meet international benchmarks. These standards and the various regulations they spawn are to a large degree meant to deter money laundering and terrorism. But, such rules beg an obvious question: are they fostering financial exclusion? I argue – yes, and some of my colleagues involved with the Alliance for Financial Inclusion would agree.

    One expression of faulty regulation is KYC – Know Your Customer. It sounds pleasant enough, no? Who should not know a customer, and thus serve her well? But KYC makes no pretense at encouraging banks to understand customers or their needs, as a route to better service. Its aim is to force banks to know just enough about customers to trace tricksters and terrorists. Yet in seeking to meet this goal, diligence officials within banks insist upon identification requirements that cannot be met by the most vulnerable segments of a given market.

    A fear of the nefarious has thrown regulators off track. Yes, the bad guys are out there, but their financial activity is only neferarious in the moments when they attempt to do something bad with their money.  Not in the moments when they save.

    The act of saving is harmless. To do harm, sinister savers must purchase something, pay someone, or make a transfer to something illicit. So let that harm be stopped, not the act of saving itself. There are already regulatory caps on amounts withdrawn or transferred. Those rules can stay in place. What should be removed is the identity hurdle associated with bank accounts.

    Regulators already make exceptions. Playing the lottery – a financial strategy that targets the poor – is curiously exempt from the tough standards of identity. Expensive prepaid cards also require less ID, as do the pricey services of money transfer. Are lawmakers negatively biased toward banks? If so, they should not be. Banks and credit unions are one of the few places that savers can earn an insured return on deposits.

    Lawmakers should focus on getting as much savings as they can into a connected system for two reasons. First, money lured into a digital account allows analysts to more easily trace sinister activity. Once in the system bad guys can be detected and snared.  Analysts cannot do such detective work if menacing targets use cash. Cash is difficult to trace.

    Second, in coaxing money into the digital system regulators can start to help the good guys, those small savers looking for ways to get their money out of the mattress and into safer, cheaper, and more profitable services.

    That means regulators must lift KYC rules for savers. KYC need only come into play when a saver does something serious with her savings. Not a moment before. At the point when a saver makes transfers of more than a few hundred dollars or makes a purchase of similar amounts, we feel sure she will be more motivated to master KYC paperwork. Up until the point, the saver is only that, a saver. A pin-code and a thumbprint should do for ID.

    In short, banks need not know their savers. Let savers go unknown and un-hassled. Let them out of the savings junkyard and into the ranks of the financially included. 

    * For an exception, see this paper, Pray for Money

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    Reader Comments (3)

    Great post, Kim.

    The silliness of KYC is underlined by the issuance of the totally unnecessary 500 euro note, sometimes nicknamed "Bin Ladens", because of the way they enable illicit money movement. Why hassle small savers if you're facilitating drug barons and arms merchants?

    Sun, October 16, 2011 | Registered CommenterPaul Rippey

    Kim, as I work my way through the latest addition ― the Anti-Money Laundering and Countering Financing of Terrorism Act 2009 ― to the many compliance hurdles for my mates at AWHI Credit Union in New Zealand’s gorgeous Bay of Plenty (now facing a stranded ship oil disaster), I’ll make a diary note to ensure that the next time I’m chatting with the BIS big-wigs I’ll ask them to tweak the rules to let savers-only off the proof-of-goodness hook.

    Seriously, whilst I couldn’t agree more with your point ― and so do the women in the stellar example of small-town indigenous peoples’ inclusive finance that is AWHI ― I fear the inability of regulators to look beyond the paranoia of today’s global politics and give the harried low-balance saver a fair go.

    The rules are made for the vested interests with the power to influence the rule-makers. Why else do tax havens still exist? Why else was the Glass-Steagall Act mutilated in 1999? From where did the idea come that financial institution supervisors should move away from a proactive inspection model to the fashionable idea of market-based self-regulation, where 'informed' consumers and rating companies (!) would exercise sensible restraint upon deposit-takers?

    Banking for the poor is, unfortunately, only on their radar in the context of a war on this and a war on that ― creating, unsurprisingly, a war on the poor too.

    Tue, October 18, 2011 | Unregistered CommenterGreg Pirie

    Kim,
    Are you familiar with Aadhaar the Unique Identification project of India which has as its goal collecting biometric data from all 1.2 billion Indian citizens? As you are very aware those without identifies in India get nothing from the government and have no ability to even open a bank account or buy a mobile phone. So people subject themselves to having their fingerprints and irises recorded and then they are given a document that verifies that they exist. Little skin off their backs civil rights wise since they started from a point of not even existing to the state to being one in 1000 million in a database. Anonymity in numbers.
    While I can see that kind of data collection would make the civil rights folks flip out here in the U.S., in India having this kind of official ID means people can participate, even if only in small ways like opening a bank account or getting cash transfer supports from the government.
    I wonder if this kind of system could satisfy the regulators need to know who a person is enough to replace KYC (at least for savers).
    The bigger issue you raise is that the banks themselves generally don't have a strategy for assisting low income people who want to save even if they do meet the KYC requirements. And I worry that data collection for national IDs can be used in nefarious ways if the wrong people get a hold of the data.

    Thu, October 27, 2011 | Unregistered CommenterBill Maddocks

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