Please describe the goal of your initiative; outline what you are trying to achieve
We develop social platforms that connect low-income families with actors from various sectors (public sector, businesses, and banks) in order to provide access to financing and public works to improve their homes and neighborhoods.
We seek a solution to a lack of infrastructure and the housing crisis through a collective mechanism that includes everyone.
At the same time we promote connections between residents, the public sector, businesses, and commercial banks to create change over the long term in these neighborhoods.
7000 families are involved in the current initiative and 2000 more are expected to participate in the upcoming year.
Which barrier(s) to financial inclusion does your solution seek to address? (select all applicable)
Physical and other accessibility obstacles that prevent communities from reaching financial services, The lack of affordable financial products tailored to the needs of underserved and excluded communities,, Powerful incentives for financial service providers to move up-market.
If you selected 'other' above, please specify which other barriers to financial inclusion you solution seeks to address:
For which underserved or excluded communities will your solution create access to valuable, affordable, secure and comprehensive financial services?
The Neighborhood Trust Funds permit resources from neighbors, companies and public entities to be invested into projects that address infrastructure deficits (water, drainage, pavements, lighting and other collective services). The Gas Trust Funds show results that validate the performance of this mechanism.
It will allow banks to begin doing business with this population, to which they can offer financial services, having already carried out an experience with a reduced risk.
It will also allow neighbors to approach the banks that financed the Trust Fund and use their proven credit performance as a prerequisite to access other financial services
Could your solution work in other geographies or regions? If so, where?
Yes! Our social platform is based on a formula that requires 3 simple elements: community organization, microfinancers & commercial banks & company/state involvement. With these components we believe our model is 100% replicable in other marginalised urban areas lacking in basic services.
In Argentina there are more than 5 million families with no access to infrastructure. They rely on the State action to gain access to services; public policy has failed to cater for their needs.
Urbanisation is a process impacting other emerging nations in similar ways, accessing infrastructure is therefore a universal problem.
If your solution is dramatically successful, how will things be different in 10 years?
The broader outlook of marginalized neighborhoods will have changed. These suburbs which have been built by neighbors will begin to benefit from a better quality of life; they will have paved roads, running water, drainage, guttering, street lighting and internet. These services will have been financed by the Neighbourhood Trust Fund using state, commercial and neighbour`s funding.
These projects redirect a part of neighbor’s savings which today are used to buy individual consumer goods (freezers, stoves, televisions, cell phones etc.) toward public goods and services. Quality of life will be notably enhanced and inequality will begin to diminish. Local employment will increase and local businesses will flourish.
What will have had to have changed to make this happen?
In order for these changes to take place the relationship between companies, the State and neighbors will need to have changed. Currently there are no projects which use “mobilizing events” that involve diverse social actors to resolve the situation. Misinformation, distrust and the absence of a common objective result in neighbours constructing their own communities without credit.
Companies and the State do not invest together in poor neighborhoods. The possibility of working together to achieve common results transforms this reality dramatically. Public policies which favor this type of project are necessary. In Argentina there are examples of suitable solutions to collective problems when there is respect toward differences and willingness to work together.
What has been the impact of your solution to date?
We have set up 4 Neighborhood Trust Funds bringing together 10.000 families of which 4.500 already have natural gas.
We have promoted articulation between multinationals, federal, state and local governments, local suppliers, neighbors as well as with local and international banks.
Also more than $US5 million have been sourced from diverse investors (neighbor contributions, commercial credits and public subsidies)
Neighbors have increased their asset wealth by between 15% and 20% thanks to a rise in the value of their homes. On top of this households increased their incomes by an equivalent of 5% due to reduced energy costs.
Levels of distrust between all the actors involved have decreased
What is your projected impact over the next five years?
Via three gas Neighbourhood Trust Funds 10.000 families will be connected to the network, the same families will have the opportunity to access credits to improve their homes thereby having a positive impact on the livelihoods of 50.000 people.
200 neighbours will have been trained in our Community Education Centre. Another 100 local builders and gas installers will have been employed on the project.
40 businesses (construction companies, manufactures etc.) will enter new markets and carry out $US10 million in public works. 3
3 to 5 banks will finance the mentioned projects
What barriers might hinder the success of your project? How do you plan to overcome them?
The biggest barrier faced is distrust and the lack of coordination between actors. The collective nature of the social platform we have designed counteracts these fears and promotes articulation. Public tenders provide an ideal interaction space for actors to work together and overcome these problems.
The other challenge is to encourage neighbors to invest in their suburbs. Consumer credit is the principal destination of savings in these communities and is a difficult obstacle to overcome. The Neighborhood Trust Funds are an efficient and accessible instrument for community development which encourage new spending habits.
Winning entries present a strong plan for how they will achieve and track growth. Identify your six-month milestone for growing your impact
Incorporate at least 2 banks to fund the United Future Neighborhoods Trust Fund and carry out 3 public tenders for the Neighbors
Now think bigger! Identify your 12-month impact milestone
To have 3 commercial financers (banks or investment funds) backing for United Future Neighborhoods Trust Fund projected for 3.50