SCHOOL FINANCE Progressive Action Commitments Progressive Action Commitments ‐ A Global, Sectoral Approach to Transforming Lives
SCHOOL FINANCE
Progressive Action CommitmentsProgressive Action Commitments‐ A Global, Sectoral Approach to Transforming Lives
Indian School Finance Co.
Progressive Action CommitmentsProgressive Action Commitments‐ A Global, Sectoral Approach to Transforming Lives
Current Issue that affects Affordable Private Schools (APS)(APS)
f d lAccess to Finance – a fundamental requirement
Below the radar for most finance companies
Growth and improvement plans of schools get hamperedGrowth and improvement plans of schools get hampered
Quality improvement initiatives and upgrades come with a lag
School Solution Providers – focused on upper end schools only
T h i i d f h hTeacher training – need of the hour
Opportunity for imPACT according to ISFCOpportunity for imPACT according to ISFC
ISFC i t t D ti Q lit Ed tiISFC exists to Democratize Quality Education
Help schools bring a revolution in their schools through
Access to finance on easy terms from a dependable company
Expose the School Solution Providers to the APS opportunity to get customized products delivered
F lli ith th b t i l i t b i hi hForge alliances with the best in class companies to bring higher standards within the APS community
ISFC’s PACT:Winning PartnershipsISFC s PACT: Winning Partnerships
PACT Description
Activity: Finance to schoolsCountry Impacted: India
Target : $5 mn portfolio by March 2011; 300 schools impacted; at least 4 alliances that help improve quality at schools
PACT Details
PACT Goal Seed ne gro thPACT Goal: Seed new growth
Focus Area: Finance to schoolsDuration: Less than 6 months
I t
Priyadarshini SchoolImpact
Before After ISFC Loan
Increment % Increment
Loan Amount: Rs 1,200,000 (USD 24,000)
Loan Increment
No. of Students 534 621 87 16%No. of Teachers 16 20 4 25%Average Monthly Fee Rs. 285 ($ 5.7) Rs.358 ($ 7.16) Rs.100($ 2) 25%
No. of Classrooms 8 21 13 163% 6
Satya Sai Vidya Niketan High schoolImpactImpactImpact
Loan Amount: Rs 1,000,000 (USD 20,000)
Before After ISFC Loan Increment % Increment
No. of Students 1,389 1800 411 30%
No. of Teachers 46 55 9 20%
Average Monthly Fee Rs. 430 ($ 8.6) Rs.530( $ 10.6) Rs.100($ 2) 26%
No. of Classrooms 8 25 17 213% 7
Thank YouThank You
Sinapi Aba Trustp
Progressive Action CommitmentsProgressive Action Commitments‐ A Global, Sectoral Approach to Transforming Lives
Current Issue that affects APS –Cash Flow Challenges
• Low‐income private schools have very limited cash flows (in addition to small budgets) ( g )
• Profitability vs Liquidity• Profitability vs. Liquidity
Opportunity for imPACTOpportunity for imPACT
• Train school proprietors in financial p pmanagement, including cash flow, budgeting /forecasting, etc. / g,
• Develop improved methods of collecting school revenues (fees)school revenues (fees)
• Provide schools loans to address their cash flows (IDPRS working capital loans)flows (IDPRS working capital loans)
OUR PACT: Improved Cash FlowOUR PACT: Improved Cash Flow
PACT Description
Activity: IDPRS Proprietor Training and Loans
Country(s) Impacted: Ghana
Target : 120 proprietors trained and receive loans (average loan size $2,000)
PACT Details
PACT Goal Impro ed Cash FloPACT Goal: Improved Cash Flow
Focus Area: Improved School Finance, and school development
Duration: 2 yearsDuration: 2 years
Additional Information
Hold proprietor trainings in 3 Regions of Ghana for 120 school proprietors in 2 yearsHold proprietor trainings in 3 Regions of Ghana for 120 school proprietors in 2 years. Afterwards, scale up throughout the country to reach more than 1,500 schools in all 10 Regions in 4 years.
Proprietor Training and Loan Photos
Trident MicrofinanceTrident MicrofinanceProgressive Action CommitmentsProgressive Action Commitments
‐ A Global, Sectoral Approach to Transforming Lives
Key Sectoral Issuesy
• Schools lack physical infrastructure – room, roof,Schools lack physical infrastructure room, roof, toilets, computers, furniture…
• Schools would like to improve infrastructure, but…p ,
• Ignored by banks and other formal financial institutions due to perceptions of poor p p pcreditworthiness.
• Lack of effective ways to signal quality – rating is not popular yet.
Trident’s Objective:j
– To provide affordable finance to affordable schools!p
– Easily accessible – simple terms, doorstep service so that schools can concentrate on their job: teaching students!
– Low interest rates and easy collateral requirements
– Based on a study of the school’s educational outcomes and managementand management
Our PACT:h h h dReaching the Unreached
Activity: Providing credit to budget schoolsy g g
Country: India
Target: 80 schools and Rs 20 million outstanding by March 2011
Goal: To provide affordable finance to affordable private schoolsschools
Focus Area: Enabling growth of APS in rural and urban areas.
Duration: 5 months
Achievement So Far:Achievement So Far:
Schools: 14Schools: 14
Students: 10,400
i b d 3 00 000Disbursed: Rs 3,400,000
Interested? Contact us:Interested? Contact us:
For loans: 09963554744For loans: 09963554744
For other details:kishorepuli@tridentmicrofin [email protected]
Thank you!!!Thank you!!!
FAULU Kenyay
Progressive Action CommitmentsProgressive Action Commitments‐A Global, Sectoral Approach to Transforming Lives
Faulu Kenya DTM VisionVisionGiving Kenyans hope and a future
Mission:To listen and empower Kenyans by providing relevant financial solutions
Profile:• Second largest MFI in Kenya with 20 years service to the poor in Kenya• 1st MFI to be regulated to take deposits (June 2009)• 300,000 clients across Kenya; 3.5 Billion outstanding loans
91 k ti ffi• 91 marketing offices• 24 banking branches• 900 staff• Products – Savings and LoanProducts Savings and Loan
Business Model:Loans to Solidarity groups – Grameeny g pLoans to Salaried individuals ‐ check‐off loansSavings ‐ Personal and business banking
Current Issue that affects APS in Kenyay
1. Access to finance to support operations and development
2. Financial products tailored to meet their specific needs• Loan appraisal• Loan appraisal
• Cost
• Repayment terms
3. Access to affordable advisory services• Capacity building to improve operations
• Modeling to enhance impact (teaching, learning and impact on the community)
• Infrustructure and learning improvements
• Expansion business planning and project management
Opportunity for imPACTOpportunity for imPACT
1. Research to quantify and qualify gaps and challenges the APS schools are facing
2 W k ith fi i l i tit ti t l it th t it2. Work with financial institution to exploit the opportunity for tailoring specific products for APS• Savings products
• Loan products
• Savings & Loan
3. Advisory services provision to improve their operations
OUR PACT: New seed growthOUR PACT: New seed growth
PACT Description
Activity : ResearchCountry(s) Impacted : KenyaTarget : 4 top MFIs
PACT Details
PACT Goal :
•Establish how many APS are their client portfolios
•Establish what products and services they are providing
•Establish appetite for structuring specific products for the target groupEstablish appetite for structuring specific products for the target group
•Establish challenges in providing financing facilities to target group
Focus Area: Opportunities for increased outreach of MFIs to APSFocus Area: Opportunities for increased outreach of MFIs to APS
Duration: : 6 – 9 months
OUR PACT: Product DevelopmentOUR PACT: Product Development
PACT Description
Activity : Product DevelopmentCountry(s) Impacted : KenyaTarget : 4 products – Savings and Loan
PACT Details
PACT Goal : Increase access to financial services to APSPACT Goal : Increase access to financial services to APS
Focus Area: : Capacity building loans and working capital facilities
Duration: : 3 – 6 months
INDUSTRY PACTSINDUSTRY PACTS
• Develop and Publish Sector Benchmarks• Develop and Publish Sector Benchmarks
• Create a network of stakeholders to assist schools to access capital
d land ensure quality
• Develop & promote forums at every stakeholder level so that all
stakeholders can support one another
• A commitment by school lenders towards increasing school quality