REFLECTION

We have come to the end of our semester and these are my personal reflections. At the beginning, I felt bad about the blog issue as I was new to it and so it as an extra work for, coupled with the fact that I joined the course three weeks later. My course mates who were to tutor me, were making matters worst for me as they were reluctant to do so. I joined wordpress but I was not getting anyway. Things changed when I began to use blog spot, where I started getting ever increasing views which motivated me to do more as it is an indication that people are interested in my ideas. Also, thanks to this blog, I feel happy that at least I have learned how impact the community-my long standing dream. I can do this not just by going to them physically but also by sharing my ideas to those who are interested in making a difference in their own community. But to be honest, updating my blog every week is somehow tiring but with determination it is possible.

FIELD WORK

This week, we brought in some people (about 35 in number) who we deemed needs financial literacy knowledge on campus where they were given the first-hand knowledge they need on financial education. The bank agent who was the main speaker, drilled them on how to get funds, manage such funds, save and repay loans. I equally spoke to them about the necessity of  generating a business idea which should be based on a realistic approach on what they can do rather than what they see others doing, before going for the funds at any micro finance institution. This is so as it determines their success. All the same it was fund, we gave them some refreshments, took some snapshots with them and departed happily. The following are some of the snapshots we took;

WEEK 8 FEEDBACK OF CHAPTER 8

Chapter 8 talks about savings and the poor. According to the chapter, the poor tend to save less due to some factors beyond their control. The reasons for the low rate of saving among the poor is due to lack of finances, the poor do not have a regular income which will sustain them to the point they will have excess to save. Also, they lack access to saving accounts in financial institutions. In addition, the fact that the poor tend to pay very high interest rates to their money lenders, thus leaving them with little or nothing to save. Again, discouragement and loss of hope equally play down on the poor’s ability to save.

  The psychology of saving and the poor suggest that the poor are willing to save but the fact that they keep the money at home makes it possible for them to spend it easily on some “tempting goods” such as alcohol. Also, saving is less attractive tom the poor because the goal is far away (discouragement) as well as the fact that the poor live with a lot of stress which hinders their ability to take good financial decisions.

A way out for the poor is to motivate them and give them the assistance (morally, materially and financially) which will pilot them out this poverty trap.

TED TALKS.

Rafaello D'endrea provides us with an astonishing way of projecting human creativity and Innovations that will better our lives. He does this by using the techniques of the quadcopters which can perform things we even thought were impossible to do, to the point of going against the known physics laws. For a better understanding, it may be worthwhile watching this video;

https://www.youtube.com/watch?v=w2itwFJCgFQ

WEEK 9. QUESTIONAIRE

This week we carried out a survey at A.U.N through questionnaire and these are the results we obtained.

1. INTEREST

a) All are interested in applying for a loan.
b) Most are not certain on whether to get a loan or not.
c) Non of them will go to their work mate when in need of extra money.

2. DEMOGRAPHY

a) Most are Males.
b) All attended Secondary School.
c) All are Singles. 3.PERCEPTIONS a) Most will use their extra money for business. b) Most of them know the difference between micro finance and traditional banks. c) Most of them have had of micro finance. 4. BEHAVIOR a)Most of them regularly save money b)Most of them keep their money in the bank c)All have received a loan from the bank.

WEEK 7: TED TALKS

FEED BACK ON CHAPTER 9.

This chapter opens us to a different picture about the poor who are now seen as natural born entrepreneurs. The poor have a greater shot of being an entrepreneur as their ideas are still fresh and have not been tried as well as the fact that they have been ignored by the rich entrepreneurs. Therefore the poor just need the right environment and a little bit of help to start their exit out of poverty. Thus if we are to help them out, we should bring the help down to them where they can get the assistance easily. This could be done by the poor themselves.  Another aspect which supports the fact that the poor are natural entrepreneurs is the fact that despite the things that militate against them, they are still willing to engage in business just as their rich counterparts. Thus given the help, even the poorest people will begin their exit out of poverty.

TED TALK 1: How to Start a Movement, by Derek Sivers.

  According to Derek Sivers, the following tips are of utmost importance when starting a movement;

•         The leader needs to stand out and be ridiculed.    
•    Your first followers must be your equals. You should treat them as equals or partners.

·        A movement must be a public show and not something secret as most people hold it.
·        To start a movement, you must have the courage to follow and teach others how to follow.
·        Your first followers are the ones who transform you into a leader and that leadership is over glorified.

TED TALK 2: Weird or Different, by Derek Sivers.

  Under this section, Derek Sivers encourages us to move out of our area of usual habitation and see how things work in other parts of the world as the opposite of what we hold or assume may tend out to be true. A good example is the case of address in America and Japan. In America, Streets are named not blocks while in Japan, they name blocks rather than streets and houses are numbered according to the order of their construction and not successively. Also, In China, doctors are being paid when people are healthy and not when they are sick, since their duty is to keep you healthy.

For more light, watch the following videos of Derek Sivers!!!!!!

WEEK 6: ATALK ON MICROFINANCE BY; ASONGO ABRAHAM

    

 Financial Literacy also known as Financial Education is the act of giving people the first-hand knowledge on how to access funds, manage their finances, how to borrow, save and payback. People who need financial literacy are actually the poor, living below the poverty line.

   Micro finance is a financial institution which has its prime motive being that of piloting the poor out of poverty to better their living standards, they do so by providing them with loans at a very low interest rate, teach them how to save and payback their debts. This movement was started by Mohammed Yunus who is seen as the founder of modern micro finance. The reason for the low interest rate is ensure sustainability. Therefore the role of the Micro finance is to help the poor do things differently by training one how to the business before giving him the finances. Before you obtain a loan from a Micro finance institution, you must have the culture of saving; they even try you first by asking you to save a given amount per day, week or so.

   Micro finance is divided into two, the formal and an informal sector. The informal sector refers to those local ones operated by petty traders on daily basis while the formal ones has to do with banks controlled by the central bank.

  Borrowers from a micro finance institution are grouped into common groups where each members of a group is liable for the debt of other group members. This is done to avoid the default. Thus the group acts in place of the collateral security collected by banks.

   The advantages of a loan from a bank over that from a friend is the fact that banks give training on how to use the money, give unlimited amounts in as much as you repay duly and there is greater prospect of continuity. Also, micro finance institutions also effect an insurance cover for its borrowers which is directly connected with the Nigerian Deposit Insurance Cooperation (N.D.I.C) and the Nigerian Agricultural Insurance Cooperation (NA.I.C).

WEEK 6- SNAP THIS

This week, we were requested to go out and snap any thing that represents financial literacy. This exercise is aimed at assessing our understanding and mastery of the course. The following images of children begging for something to eat illustrate a call to action as what we read in text books are equally happening right around us.

WEEK 5: SUMMARY OF CHAPTER 7

SUMMARY OF CHAPTER 7

   Chapter 7 opens us to another agony endured by the poor which is the aspect of borrowing at a very high and exorbitant rate of interest which keeps them perpetually poor. The chapter equally examines the emergence of Micro finance Institutions (MFI) and their evaluation, the difficulty of lending to the poor, and how big businesses are being financed.

    The chapter opens with a range of poor women selling fruits and vegetables along the street which they borrowed from wholesalers in the morning to repay at night at a very high interest which makes their efforts less rewarding, thus keeping them constantly poor. For instance in Chennai (India), a woman borrowed vegetables worth of 1000 rupees in the morning and had to repay 1,046.9, which is equivalent to 4.69% interest per day. These excessively high rates had led to the emergence of MFI which tend to give loans to the poor at a very low interest rate in the name of Social Entrepreneurship. A good example is the case of Mohammed Yunus and Padmaja Reddy the CEO of Spandana. However we are told that despite the low interest rates, the poor tend to borrow less from these financial institutions caused by the rigidity and inflexibility of these financial institutions. For instance, before they can access funds they need to be in groups and that they should start repaying the loan just two weeks after they had been giving the loan. This has reduced the number of borrowers as those who don’t want to be in groups as well as those who were not ready to do early repayments usually stay away, thus making these institutions ineffective in lessening the poor’s situation.

    The high rates are due to a multiplicity of factors such as the high risks of defaults which is about 40%, the cost book keeping, the cost of monitoring the poor and the multiplier effects which result from the high rates as they tendency of default increases with high rates. Banks have a tendency of not lending the poor because of the lack of diligence and the time to monitor the poor, thus leaving them at the mercy of those exploitative money lenders. Larger firms face financial difficulties as they lack from who to borrow from. There is a normal graduation process where smaller business are financed by moneylenders and MFI and as they grow larger, they are being financed by Banks, but the problem lies in the fact that some businesses are bigger than moneylenders to finance and too small for banks.