The presentation is Mr. Kingsley Ughe, Consultant, Consultancy Africa Intelligence from the just concluded African Round Table & Conference on Corporate Sustainability and Responsibility (AR-CSR™), which held in Tinapa Business Resort, Calabar, Cross River State between 20 to 21 June, 2013.

1. Legal Frameworks and Regulatory
Intervention and Innovation
Mr. Kingsley Ughe
Consultancy Africa Intelligence

2. Purpose of Legal & Regulatory
Intervention.
• To move towards a government controlled
structure for reaching un-served or under-
served portions of a country’s population.
Cases:
• India
• Nigeria
• United States

3. Key Innovations in India
• non-governmental organizations which were serving as ad-
hoc microfinance institutions in the absence of true
servicing of the financial borrowing and saving needs of the
poorest sections of the populations.
• target populations for development via microfinance
stimulation in India had little or no trust for the
governmental institutions that existed.
• These organizations were able to use this tendency to
leverage their position with the regulatory bodies to
facilitate their acceptance as registered approved financial
institutions and increase their access to the kind of capital
they would need to see large-scale growth.

4. Key Innovations in Nigeria
• The informal, non-governmental institutions
and community banks were also the primary
source of microfinance services;
• Newly imposed legal and regulatory
frameworks have done little to change the
situation;
• African businesses are driven by small scale
industry. Regulatory frame work in Nigeria
appears not to be driven by innovation but by
the desire to sell and disburse licenses.

5. Key Innovations in America
• Microfinance regulations in place for years
created a boom in development, home business
ownership, and empowerment of the lower
income members of the population;
• However, America suffered a massive failure of
microfinance institutions that ended many of
those same organizations that were able to grow
themselves and thrive a few years before.

6. Cases Cont’d
• In India, the local, small-scale lenders servicing a
disillusioned population were able to translate their pre-
regulation position in the community into a near-monopoly
on microfinance products during the transitional phases at
least;
• In Nigeria, the failure of government institutions to provide
appropriate services secured the place of the non-
government organizations in the community in anticipation
of better regulations;
• In America, small debt-relief companies were able to take
advantage of the new legal framework designed to help
people recover from that failure. They transformed
themselves into champions of the rescue effort and
capitalized on the disillusionment of the population with
the institutions that previously held their confidence.

7. Conclusion
In each case, the cultural and social structures
that had developed in response to the
financial climate found new opportunities for
re-invention and growth within the new
regulations shaped by an emergent "common
cause" paradigm. In each case, cultural
defense mechanisms provided opportunities
for innovation.