By Ma. Verónica Moreno -Head of Solutions Mapping AccLabUNDPArg @mveronicamoreno

A reward for those who make a difference in their neighborhoods: financial education in social organizations

Everyday hundreds of people, or rather volunteers —practically all of them women— get up, leave their houses and work in community organizations to cook for their neighbors, feed them and provide a space for social integration in low-income neighborhoods. Many of these organizations were born after the crisis of 2001 to satisfy the demand for food derived from the social emergency. However, over time, a large number of them added new services that responded to other unsatisfied needs in the territory, from childcare or school support to occupational training.

Given its importance, when earlier this year the UNDP Argentina Accelerator Lab decided to do fieldwork, we made our first visits in the National Plan for Food Security social organizations. Therefore, we were able to speak with several of their leaders, better understand their problems, identify their strategies to deal with them and, along the way, confirm the immense work they do.

Because of our focus was financial inclusion, we were also able to reaffirm how far the traditional financial system was from this population and their needs. For example, even if people had an account —to collect their wages, pensions or social plans— they generally did not recognize it. They also hardly used their debit card, except to withdraw all the money at the beginning of the month. In addition, experiences in banks or payment centers, which take time and cost money, could be hostile because they don’t feel confident in how to operate or what to do.

As an alternative to the formal system, we identified some financial strategies that low-income people implement in their neighborhoods based on proximity, trust, mutual support, and a shared sense of community.

As noted in the social organizations which feed thousands of people daily, these solutions are usually driven by persons who are also directly affected by the exclusion. In other words, these women leaders are no exception: they feed their neighbors and, in return, they can take food home.

Since the outbreak of the pandemic, the slowdown in the economic activity and its negative impact on low-income households, these organizations experienced an increasing number of people knocking of their doors in search of food. Likewise, the demand for social assistance also increased and, in fact, the National Government ordered the Emergency Family Income (IFE).

In this sanitary and social emergency, a painful situation occurred which exposed the high price paid by those who do not have enough information on how to operate with the financial system. In quarantine, when banks reopened after being closed for several days, the system collapsed. A crowd was exposed to a massive spread of COVID-19; queuing long hours and without physical distance to collect their pensions or social plans. Necessity prevailed over caution.

The Argentina AccLab firstly reacted with campaigns to promote useful tools for the unbanked: a system that allows the withdrawal of cash at ATMs, and digital wallets and banks because they facilitate digital payments (a highly recommended measure) and, in the case of digital banks, the IFE collection.

However, the scope of these actions is limited, and for us it was a priority to be present in the field. Then, alliance building paid off. FONCAP —a national inclusive finance player— proposed to us, with the National Council for the Coordination of Social Policies, joining a COVID-19 Protocol for these social organizations.  The idea was to disseminate financial recommendations. There were no doubts about it; we wanted to be there.

We collaboratively designed and produced posters with simple instructions related to the use of ATMs and debit cards; the possibilities of collection (moments, places) of the retirements, social plans and the IFE, and some measures of prevention given the pandemic.

These posters were very well received and aroused great interest during trainings in social organizations. They also showed us the need to develop other instruments to disseminate this information and amplify its messages. We made a kind of "portable manual" so that people can carry it in their wallets along with their cards and documents. This fold-out brochure (which is the same size as a card) has the most relevant information to operate at the ATMs whenever they need it, among other indications on its usability.

So, we returned to our starting point: the community organizations which feed thousands of people. Now, with the intention of contributing to the empowerment of all those who organize and work voluntarily, even in times of pandemic, to shape a more equal world. This cycle, instead of being a concretion of our work in financial inclusion, gave us the opportunity to reward those who daily make a difference in their territories.