Social and Solidarity Finance: Tensions, Opportunities and Transformative Potential (Event Brief)

The UNRISD Workshop, in collaboration with the Friedrich-Ebert-Stiftung and the International Labour Organization, took place on 11-12 May 2015. The workshop objective was to start conceptualizing social and solidarity finance, and to evaluate its transformative potential as a pathway to sustainable development. The participants included 29 experts in the fields of alternative and microfinance, anthropology of money, social and solidarity economy (SSE), and gender. Academics and practitioners from the global South and North, as well as staff of United Nations agencies, took part. They presented a rich body of evidence on the diversity of forms of SSF, their role as a financing tool for SSE and local economic development, and the tensions they face when trying to scale up operations.

During the workshop it became clear that "social and solidarity finance" cannot be reduced to particular financial arrangements or organizations. It should rather be understood as a coherent system integrating financial relationships and social interactions within a framework of support, trust and solidarity (Amélie Artis, Benjamin Quiñones, Anup Dash, Jean Fabre). The result of such an approach to finance is a more egalitarian power relationship between borrowers and lenders than found in traditional financial transactions. For example, ethical banks and financial cooperatives target specific audiences (women, the unemployed, new businesses) and finance certain types of social and economic activities, such as those related to the environment, education and social welfare, which are often excluded from conventional banking credit (Amélie Artis).

Social and solidarity finance is therefore used to refer to a diversity of financial arrangements. Among them, ethical banking, financial cooperatives, community development banks, solidarity microfinance, community-based savings schemes—including rotating savings and credit associations (ROSCAs), and savings and credit cooperatives (SACCOs)—solidarity revolving funds, complementary currencies, crowdfunding, participatory budgeting and, arguably, crypto-currencies, impact investing and social impact bonds.

This brief was prepared by Simon Gewölb, Marie-Adélaïde Matheï and Joannah Caborn Wengler.

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