People on low incomes are potential markets and opportunities, UNDP
A regional report by the United Nations Development Program (UNDP) shows that companies who make use of inclusive business models in Emerging Europe and Central Asia (ECA) can achieve gains both for the poor and for their bottom line, Info-Prim Neo reports.
The report, Business Solutions to Poverty – How inclusive business models create opportunities for all in Emerging Europe and Central Asia, features for the first time case studies from 19 countries in the region, and provides practical recommendations for how to develop inclusive business models.
The Rural Finance Corporation (RFC) Moldova, which is a non-bank financial institution that provides financial services and micro-credit that are usually nonexistent or underdeveloped in rural areas as well as financial education to farmers and entrepreneurs, was part of the case studies included in the report. After almost 12 years of operation, RFC is a loans leader on the Moldovan market, accounting for almost 29 % of the industry profits, and showing a real capacity to obtain results with fewer resources involved.
Kori Udovički, Assistant Administrator and Regional Director of UNDP’s Bureau for Eastern Europe and the Commonwealth of Independent States, said there is growing evidence that businesses that engage the poor on the demand side as clients and consumers and/or on the supply side as producers, employees and business owners, can boost their bottom line while creating value for the poor.
More and more companies around the globe are recognizing that people on low incomes are potential markets and opportunities. The report describes examples of successful inclusive business models in such sectors as agriculture, financial services, ICT, tourism and waste management.
The report also provides market data and concrete recommendations for how to support inclusive business in the region. Some 130 million people in the region live on $4.30 a day or less. 11 million people in the ECA region are unemployed and 140 million work in the informal economy. Almost 19 million people lack access to clean water and almost 40 million lack access to an improved sanitation facility. Over 5 million people in the region do not have access to electricity and more than 150 million do not have access to financial services.
UNDP is the UN's global development network, advocating for change and connecting countries to knowledge, experience and resources to help people build a better life.