Financial inclusion for refugees

  • Maxime GRIMAUD, European Investment Fund (EIF) 
  • Ian TAYLOR, Mastercard 
  • Bdour M. AL-HYARI, Microfund for Women (MFW), Jordan 


Amelia GREENBERG opened the session by introducing the Social Performance Task Force (SPTF) working group on Microfinance for Refugees. In partnership with the Livelihoods Unit of the United Nations High Commissioner for Refugees (UNHCR), the SPTF is working to increase access to financial services for refugees.

Maxime GRIMAUD, from the European Investment Fund (EIF), presented a Payment by Results (PbR) scheme aiming to improve the integration of refugees in the Finnish job market. This scheme is funded by public and private investors, including the EIF itself. A PbR manager assigns a social service organisation to deliver a social intervention with the investment. In this case, refugees received integration trainings, career guidance and coaching and the support of reputable personnel services companies, so they could join the country's workforce. This led to lower government costs, as fewer refugees needed to receive welfare payments, and increase government revenues as the refugees who get a job then paid income taxes. Based on these lower costs, the Finnish government paid back the investor. The targets set were to decrease the cost of refugees for the Finnish government by 70% and to double the employment rate for refugees.

Grimaud argued that this large and innovative PbR was key to show private investors that they can fit impact objectives in their traditional investment framework. He stressed that impact needs to be measurable and validated by independent parties, because the impact determines what payment needs to be made to investors. Grimaud added that the first results of the PbR scheme were very promising, having already resulted in more than 100 new job opportunities and over 7,000 training days provided.

Ian TAYLOR, from Mastercard, emphasised that regrettably he represented one of the few commercial organisations attending the event. He added that Mastercard has a vested interest in sustainable growth of digital payments, which is one reason why they support financial inclusion. Taylor explained that Mastercard is a facilitator of payments, therefore, the organisation works with different partners in its wide range of financial inclusion activities. Taylor added that he wants to reassure other commercial organisations that, if they invest in financial inclusion, they can also do well as a company.

Taylor shared several examples of Mastercard's recent refugee involvement. In Greece, the organisation partnered with the UNHCR to offer a payments card to refugees. He presented several challenges in financial inclusion for refugees, including the reservations of financial service providers, and limitations in infrastructure. He added that Mastercard could not build a uniform global system, since all governments, financial services providers and NGOs have different safeguards for know your customer (KYC), anti-money laundering (AML) and combating the financing of terrorism (CFT). According to Taylor, success factors include collaboration with both public and commercial partners, sustainable pricing, and moving from access to usage.

Bdour AL-HYARI, from Microfund for Women (MFW), presented a group-lending product developed for Syrian refugees in Jordan. She explained that MFW wanted to enhance solidarity between Syrian refugees and the Jordanian population. The institution first launched a mixed product for both Jordanians and Syrians. After this was successful, MFW launched a product for Syrians only, conducted a feasibility study and a research on Syrians' inclusion and non-financial services.

Al-Hyari also explained that a mind-set change occurred in the employees of MFW. She added that, at the start of this process, employees perceived catastrophic risk in working with Syrian refugees, and lacked knowledge on the subject. However at the end of the process, employees were more confident and wanted to expand the products for Syrian refugees. Al-Hyari added that the experience also resulted in a better understanding of the market and a stable portfolio. In future, MFW aims to expand their services to all non-Jordanians, further build capacities of their staff to work in this segment, and develop supporting tools and non-financial services.

Micol PISTELLI, from the United Nations High Commissioner for Refugees (UNHCR), presented data on refugees. She explained that the number of displaced people in 2016 was the highest since World War II. She added that 55% of refugees worldwide come from Syria, Afghanistan and South Sudan. Top hosting countries for these refugees are Turkey, Pakistan, Lebanon, Iran, Uganda and Ethiopia. Pistelli argued that refugees are often forgotten by MFIs and banks. This is due to legal issues and because refugees are an unknown segment for most financial service providers.

She stressed that the UNHCR is a facilitator and enabler for their partners wanting to work with refugees. Pistelli explained that the agenda of the UNHCR consists of advocacy; building the business case for servicing refugees, based on assessments and market analyses; providing appropriate incentives to MFIs to service refugees; and disseminating and replicating best practices. She shared an example of Gihembe refugee camp in Rwanda, where UNHCR facilitated meetings with Rwandan financial service providers and refugees from DRC.


The moderator asked the panel to share some insights into working with refugees and misconceptions that financial services providers commonly have in doing so. Al-Hyari explained that, although Syrian and Jordanian women share a common culture and language, Syrian women are very different when they are living as refugees. Grimaud added that the EIF was surprised that they faced difficulties to reach sufficient participants in the PbR scheme. They changed their tactics by meeting with refugees as soon as they arrived in Finland, and by explaining better what the scheme could do for them.

Taylor explained that, in his experience, the financial needs of refugees depend on their state of vulnerability. Financial needs change from cash when they first arrive, to remittances, insurance, credits and then even pensions and mortgages when refugees are more integrated in the host country. Pistelli agreed, and added that many financial service providers see refugees as a high-risk market segment. After meeting with refugees, they are surprised at the potential of this market segment. Moreover, financial service providers realise that they do not need to develop new products to reach the segment.

A member of the audience asked the panel for their experience in different distribution channels, such as mobile money and prepaid cards. Taylor responded that mobile money is useful in peer-to-peer payments. Mastercard also uses pre-paid cards, mostly when donor money is involved.

A participant from Oxfam wondered if the financial needs of refugees are different if they lived in or outside of refugee camps. Pistelli argued that refugees in camps often have less mobility and opportunities to use financial services. Al-Hyari added that refugees in a camp have more basic financial needs, such as cash assistance, which are covered by humanitarian agencies like the UNHCR. When living outside of camps, refugees are more interested in other MFI products, such as loans. Greenberg added that financial needs of refugees also depend on the age of the camps.

A participant from GIZ asked what role trust plays in financial inclusion for refugees. Al-Hyari responded that trust is a key issue, and that refugees do not trust the ecosystem they are in. Once MFW started its work with refugees, they needed to build this trust. Al-Hyari urged MFIs to do this responsibly, and to properly respond to refugees' needs. She shared an example of a client who used her first loan for consumption. Only after she realised she could have confidence in MFW and trust herself to pay back the loan, she applied for a second loan to develop a business.