What We Do Business Intelligence
Opportunity EduFinance is driving successful education outcomes through data
We view data as central to our work. This data has always informed monitoring and evaluation, but it also provides evidence for how microfinance can help fix the global education crisis.
Data from Uganda, for example, suggests that a US$10,000 School Improvement Loan typically boosts the number of pupils at school from 250 students to 304 students within less than three years, a growth of 22.5%. It also funds average staff increases of 33.6%, so student:teacher ratios drop favourably, and an increase in school income that sees high levels of reinvestment back into the school.
Opportunity EduFinance receives its data from both its partners in the field and from third parties. The data is collected in a consistent format and entered into a single database, which covers both financial performance and social impact. As we collect more and more data, we use it to provide key insights and predictive analysis that inform everything from product development to understanding organisational behaviour at schools.
Driving down the risk of lending to schools and parents in the developing world
Soon after the Opportunity EduFinance programme began in 2012, for example, the data began to show that default rates were nearly twice as high for School Improvement Loans in which the school had been operating for less than two full academic years. Over the same period, the defaulting schools saw dropping enrollments and subsequently reduced cash flow. This finding in the data led the EduFinance team to question key stakeholders in those communities, where we uncovered that parents were using the first years of a school’s existence to gauge whether or not they could perform to expectations. If not – as was the case here – they would vote with their feet for a more reliable institution. This finding allowed us to alter our products to lend only to schools which were in existence for a minimum of two academic years, subsequently matching our lending with parents’ own quality control process, and reducing the risk for both schools and socially-motivated FIs.
Opportunity EduFinance EdPack: a business insight tool for Finance Institutions to measure financial and social performance in educational lending
FIs and other partners can also benefit from detailed analysis of this flow of data. For example, partnered FIs receive data dashboards, an easy-to-understand visual presentation of large amounts of data to show them how their loan portfolio is performing, highlight key trends over long periods of time, and identify areas of both strength and weakness alongside leading recommendations. The ‘EdPack’, as it is known, is a core business intelligence tool used by Opportunity EduFinance to ensure that financial institutions remain atop not only portfolio financial performance, but social performance as well.