Blog

The path to resilience: MSC’s ecosystem approach to adaptive social protection (ASP)

Posted on by Saumya Dixit

Vulnerable people worldwide rely on social protection systems as vital lifelines. These systems include social assistance, insurance, and labor market reforms. They were traditionally built to address and manage chronic yet predictable risks, such as poverty and unemployment. Today’s world, however, presents more complex and unpredictable challenges—from climate hazards (e.g., shocks such as floods, cyclones, etc., and stresses- such as changing precipitation, rising temperatures, etc.) to other disasters, e.g., pandemics, armed conflicts, or financial crises. Such events endanger people’s lives and livelihoods while also deepening structural inequalities and persistent poverty.

As climate hazards and disasters become more frequent and severe, traditional social protection systems struggle to keep up. Adaptive Social Protection (ASP) has emerged as a response to this and intends to help vulnerable households build resilience. ASP examines and identifies strategies for ex-ante preparedness, ex-durante response, and ex-post recovery.

The need for a holistic ASP ecosystem

ASP is a comprehensive strategy that combines social protection, disaster risk reduction, and climate change adaptation. However, despite ongoing progress, some gaps remain:

  1. Coverage and reach: Urban vulnerability remains underrepresented in the literature on ASP. The focus on rural communities leaves gaps in addressing the specific risks urban populations face, especially those residing in informal settlements.
  2. Identification and access: In countries, the effective functioning of ASP is hampered by the lack of social registries or targeting issues due to outdated data, exclusion errors, and lack of interoperability. For example, the national social registry in the Philippines was not updated for four years during COVID-19, which made it unreliable for the rapid expansion of social protection programs.
  3. Service delivery: Manual and fragmented payment systems create delays and leakages in the transfer of benefits. ̌Evidence from a mobile money cash transfer experiment in Niger shows how manual payments add extra costs for recipeints.
  4. Climate adaptation: Most countries lack climate-focused social protection and rely on emergency support. The ILO reports that more than 90% of people in the 20 most climate-vulnerable countries lack any form of social protection. For example, when severe floods hit Cambodia in 2022 and people were still coping with the effects of the COVID-19 pandemic, the government had to rapidly extend cash transfers to address both types of shocks—pandemics and floods. Further, coverage of anticipatory cash transfers worldwide is limited, as it covers only 13 million people, with an approximate allocation of USD 200 million.
  5. Financial stability: For underdeveloped countries, where government spending is already constrained and borrowing from capital markets is very costly, budgetary reallocations for climate-induced shocks and stresses come at a cost. As highlighted by the ILO, little guidance is available on innovative financing mechanisms or successful examples of blended funding streams that developing countries can use to create such systems.

Considering these gaps, MSC follows an ecosystem-based approach to ASP that aims to assist governments in building robust, responsive, and inclusive social protection systems. This blog explores the rationale, methodology, and practical applications of MSC’s ecosystem approach to ASP. It draws from our experience across Asia and Africa and offers a roadmap for governments seeking resilience and equity in the face of new challenges.

The approach stands out for its holistic, evidence-based methodology. It comprehensively evaluates demand and supply aspects to help address climate hazards and disasters. The objective is to enable individuals, households, and communities to anticipate, absorb, and recover from hazards and disasters.

Demand-side analysis

On the demand side, the approach evaluates the sustainability and overall well-being of individuals, households, and communities using the five capitals approach (human, social, natural, physical, and financial). Further, it systematically examines the following four key dimensions.

  1. Exposure: Identifies the degree to which populations, infrastructure, and ecosystems are located in hazard-prone areas and the factors that hinder their ability to prepare, respond, and recover. It measures who or what is at risk and the extent of their exposure to potential shocks.
  1. Vulnerability: Understands the factors that hinder an individual or community’s ability to prepare for, respond to, and recover from climate hazards and disasters.
  2. Perception: Examines citizens’ perceptions of their susceptibility and preparedness and their understanding of the government’s efforts and capacity to respond to shocks, providing insights into factors like trust and awareness.
  3. Experience: Reviews how vulnerable populations interact with social protection programs and government disaster response programs; it focuses on accessibility, adequacy, and timeliness of services received, and highlights successes and areas for improvement in service delivery

The demand-side analysis combines these four dimensions with the five capitals approach. It offers a complete picture of the capacity of individuals, households, and communities to prepare for, cope with, and adapt to hazards and disasters.

Supply-side analysis

A comprehensive supply-side analysis systematically maps and evaluates the policies and institutional structures, infrastructure, market mechanisms, and sociocultural factors. These factors underpin a country’s capacity to support vulnerable populations and ensure inclusive, adaptive, and resilient disaster management. These four pillars are essential to understand and strengthen a nation’s disaster resilience.

  1. Policy and institutional readiness: This element assesses the strength and responsiveness of a country’s policies and institutions in disaster preparedness and response. It examines whether vulnerable groups are identified and protected by law and included in disaster plans and support measures. It also reviews digital public infrastructure within government systems to ensure the smooth flow of resources, information, and government-to-person (G2P) transactions during emergencies.
  2. Infrastructure readiness: This element evaluates the resilience of a country’s infrastructure, including the digital infrastructure, to prepare for and respond to climate hazards and other disasters. Key areas include water, sanitation, and hygiene (WASH) facilities, transportation and logistics networks, financial services, and telecommunications systems, all critical for effective disaster management. Additionally, with the increasing threat of epidemics and pandemics, the resilience of healthcare infrastructure is crucial to operate effectively during crises.
  1. Market readiness: This element looks at how market and economic systems support disaster resilience. Access to finance, agricultural productivity, and climate adaptability across agriculture and food systems are essential to ensure food security. It evaluates the capacity of industries to withstand climate hazards and other disasters to ensure resilience measures are integrated across sectors to support sustainable recovery. For example, India’s market and infrastructure readiness allowed the delivery of free food to ~800 million people during the COVID-19 pandemic.
  2. Sociocultural readiness: the socio-cultural dynamics that influence a society’s resilience to disasters, focusing on inclusivity across race, caste, gender, and ability. It assesses how social diversity is acknowledged and supported in disaster planning, ensuring equitable protections and resources for all groups. This pillar also evaluates the trust between communities and the government and the availability of mental health and cultural support systems to aid in preparedness and recovery. Additionally, it highlights the value of indigenous knowledge, recognizing traditional practices and wisdom that can enhance disaster response and resilience strategies through locally-led adaptation.

The supply-side analysis enables governments to systematically identify gaps and bottlenecks. It pinpoints institutional, infrastructural, and market weaknesses that hinder effective disaster response. By addressing these bottlenecks, governments can strengthen the ecosystem and ensure that social protection systems are robust, inclusive, and responsive to emerging climate and disaster risks.

The design of suitable APS interventions

The demand- and supply-side analyses help us identify the gaps that affect vulnerable groups when they seek to cope with shocks and recover from them. Governments can address these gaps in one of these two ways:

  1. They can adapt existing programs for climate-induced shocks and stresses by expanding cash or in-kind support temporarily during shocks. The governments can use horizontal (coverage expansion) or vertical (benefit increase) mechanisms. Programs can use early warnings, such as rainfall, flood forecasts, or heatwave alerts, which would allow the government to take early actions, such as food or cash disbursement, before a disaster hits. Programs can also add climate vulnerability criteria to existing eligibility rules while creating beneficiary registries.
  2. They can design a new adaptive social protection program specifically designed to address climate-related risks, such as climate-linked cash transfers or adaptive public works that respond predictively to climate triggers. Programs can adjust benefits based on the severity and type of hazard, such as drought-indexed agricultural insurance, conditional cash transfers tied to livelihood diversification, or employment schemes focused on ecosystem restoration.

The path ahead

With this approach, we attempt to provide a flexible and forward-looking framework for governments and stakeholders to address the growing climate hazards and other disasters. This ensures that social protection programs are more inclusive and effective, and can evolve in response to emerging risks. Ultimately, the ASP approach empowers stakeholders to build adaptive, resilient, and equitable systems that protect the most vulnerable people, support their sustainable recovery, and nurture long-term resilience in an increasingly uncertain world.

Youth-focused agri-finance

Posted on by Deepesh Singh

Toolkits on locally-led adaptation for communities and inclusive finance service providers (IFSPs)

Posted on by Deepesh Singh

MSC LLA community Toolkit summary

MSC’s Community Toolkit for Locally-Led Adaptation offers stakeholders a structured, participatory process to assess climate risks and cocreate adaptation plans with local communities. It combines local knowledge with scientific data to map hazards, evaluate vulnerability, identify and prioritize adaptation options, and develop actionable, costed plans. We have designed the toolkit for local governments, civil society, and financial institutions. It builds grassroots ownership, strengthens institutions, and supports inclusive, climate-resilient development at the community level.

Click here to learn more.

MSC LLA IFSP Toolkit summary

MSC’s IFSP adaptation toolkit equips inclusive financial service providers so they can assess climate risks within their MSME portfolios and design tailored, climate-responsive financial products. It also empowers MSMEs to use participatory tools and supply chain mapping to identify exposure and vulnerability and develop adaptation strategies. The toolkit enhances portfolio risk management, supports product innovation, and enables financial service providers to help drive MSME adaptation and long-term sustainability. Through the toolkit, MSMEs can also cocreate solutions to build their resilience.

Click here to learn more.

The road to equality: The role of gender-intelligent banking in addressing credit access challenges for women entrepreneurs in Bangladesh

Posted on by Saumya Dixit

Women entrepreneurs in Bangladesh contribute at least 20%-48% to the country’s GDP​​. While women own 37% of bank accounts, their access to credit remains disproportionately low. Studies also indicate that women hold only 17.9% of loan accounts, which accounts for just 6.5% of total loan assets in the banking sector. This disparity is especially pronounced in women-led small and medium enterprises (SMEs), which often struggle to secure adequate financing. 

A complex web of issues hinders women’s access to credit in Bangladesh. Among the most significant hurdles women entrepreneurs encounter are bureaucratic red tape and complex documentation requirements. Collateral requirements by formal institutions are another significant barrier. In a society where women rarely own assets, such as land or property due to gendered inheritance practices, these prerequisites further marginalize women in the credit system. Additionally, lengthy and bureaucratic loan procedures deter women, particularly those with limited literacy or exposure to formal banking systems. As a result, women entrepreneurs are forced to seek informal credit, despite the risks and higher interest rates. 

Women’s barriers to credit access are not limited to structural challenges. They are also rooted in sociocultural norms. Patriarchal traditions often limit women’s mobility, decision-making power, and financial independence. This leaves them reliant on male family members for financial transactions. Even when women legally own businesses, they frequently require male co-signers for loans, which further perpetuates their dependency. Furthermore, gender bias within financial institutions paints women entrepreneurs as high-risk borrowers, which discourages them from designing tailored financial products for these women.

Policy implementation gaps also hinder efforts to improve women’s access to credit. For example, while the Bangladesh Bank mandatorily allocates 15% of credit portfolios to women entrepreneurs, weak enforcement has rendered it largely ineffective. Similarly, credit guarantee programs designed to facilitate collateral-free loans remain underutilized due to their poor implementation and low awareness among beneficiaries. 

Although Bangladesh’s financial landscape is riddled with these problems, they are not insurmountable. Innovations in gender-intelligent banking have emerged as a potential way to break down these barriers. These include financial products and services designed specifically to meet women entrepreneurs’ needs. For example, Mutual Trust Bank (MTB) provides a small-ticket savings product combined with a secured overdraft facility so that women can access short-term, low-cost credit based on their savings history. This approach encourages consistent saving habits and reduces reliance on collateral. 

Another key development is the digitization of financial services. Bank Asia’s digital loan application system reduced the need for physical branch visits and simplified documentation requirements. This initiative minimizes opportunity costs and makes credit more accessible, particularly for women in remote areas.

Gender-disaggregated data can also play a critical role to make financial products and services more inclusive. Banks can use the customers’ data to create gender-intelligent strategies to better understand and address women entrepreneurs’ needs. Such strategies can help create more inclusive financial products, services, and delivery channels that can ultimately promote their financial independence and nurture sustainable business growth. 

Gender-intelligent banking is not about offering more products but rather about transforming the financial ecosystem from within to be more inclusive. An increase in women’s representation in leadership roles can play a critical role to shape policies better aligned with their needs. 

The problem of women’s unequal access to credit is not unique to Bangladesh. As per the International Finance Corporation (IFC), globally, women-owned businesses face an enormous financing gap of about USD 1.5 trillion in the formal SME sector. This disparity highlights a substantial untapped market for banks to expand their SME loan portfolios by investing in women entrepreneurs. The global context makes the condition in Bangladesh even more significant. Bangladesh can witness tremendous economic growth through gender-intelligent banking practices, tailored financial products, digitized services, and capacity-building programs. At the same time, financial institutions can address sociocultural and institutional biases and policy gaps to work toward the global goal of gender equity and financial inclusion.

Bangladesh is at a pivotal moment where investments in gender-intelligent banking can contribute to sustainable economic growth, reduce gender disparities, and create a more inclusive financial ecosystem. As the country stands at the cusp of a major transformation, its present situation is a call for stakeholders across the globe to create an environment where women-led enterprises flourish and build a more prosperous and fairer society.

New credit reporting rules: What has changed for borrowers and lenders

Posted on by Deepesh Singh

The Reserve Bank of India (RBI) has introduced new credit reporting guidelines aimed at improving the accuracy and timeliness of borrower information shared with credit bureaus. The Credit Information Reporting Directions, 2025, released this year, are designed to address issues in India’s credit assessment system. One of the key changes is the move to bi-monthly credit data updates. Lenders are now required to report borrower information twice a month—by the 7th and the 22nd. This reduces the lag in tracking repayments and helps curb overleveraging.

“Frequent updates reduce blind spots in credit data and ensure more informed lending,” said Shubha Bhanu, Lead, BFSI at MSC (MicroSave Consulting).

Previously, monthly reporting led to delays of up to 40 days, often leaving credit institutions with outdated borrower profiles. The revised timelines are expected to help lenders detect risks earlier and make better decisions.

Another major change is the standardisation of credit scores across all credit information companies (CICs). Scores will now follow a uniform range of 300 to 900, making it easier for both lenders and borrowers to interpret creditworthiness. The guidelines also streamline credit reports by linking borrower records to government-issued IDs such as PAN, passport, or voter ID. A single, consolidated report will now reflect all open and closed loans, defaults, legal actions, and coborrower or guarantor roles.

“These measures help eliminate fragmented data and provide a clearer picture of a borrower’s total liabilities,” Bhanu added.

Additionally, CICs can now share credit data with non-specified users—entities not traditionally allowed access—provided they secure borrower consent. This expansion in data sharing is balanced by strict privacy and security requirements. While the new norms may require significant tech and process upgrades for lenders, experts see them as a step toward a more transparent and responsible credit ecosystem.

This article was first published on CNBC TV 18 on 21st May 2025.

Why India’s expanding waistline demands urgent attention?

Posted on by Deepesh Singh

In a small clinic in Mumbai, a doctor sees two patients back-to-back. The first is a severely underweight child stunted from years of malnutrition. The second is a 32-year-old man, obese and pre-diabetic. This stark contrast is a growing reality in India. While hunger remains a crisis, obesity is an equally urgent public health emergency. Yet, unlike diabetes or heart disease, obesity continues to be India’s silent epidemic—recognised but rarely confronted.

India ranks third globally in projected obesity-related economic losses after China and the US. Urban obesity rates range from 13 per cent to 50 per cent, and even in rural India, they hover between 8 per cent and 38 per cent. The proportion of overweight children rose 2.1  per cent to 3.4 per cent between recent national surveys (NFHS-4 to NFHS-5) (1). Obesity doesn’t stay solo for too long. It is often the precursor to many Non-Communicable Diseases (NCDs), including diabetes. Between 1990 and 2016, India’s diabetes prevalence jumped by 64 per cent (2), as cases skyrocketed from 26 million to 65 million. This is just one of the many health issues that stem out of obesity.

Obesity costs India an estimated USD 23.2 billion (3) annually in healthcare expenses and lost productivity. If current trends continue unchecked, global obesity-related GDP losses could soar to USD 4 trillion (4) by 2035.

Despite these alarming numbers, India lacks a coordinated response to obesity. The National Programme for Prevention and Control of Non-Communicable Diseases (NP-NCD) (5) labels obesity as a risk factor but allocates little direct funding to combat it. Other nations have taken decisive action – New York (6) banned trans fats, and the UK (7) and US (8) introduced sugar taxes—but India’s policy measures remain weak and poorly enforced. The government’s Eat Right India (9) campaign has made some progress in raising awareness, but it stops short of regulating food companies that flood the market with ultra-processed, high-sugar, high-fat products.

Obesity care is also financially out of reach for most Indians. While Ayushman Bharat (10) covers major health risks, it does not include obesity treatment or weight management programs. Private insurance policies exclude obesity-related care unless linked to severe complications. This forces most Indians to delay intervention until it is too late.

India’s food environment does little to support healthy choices. Unhealthy, ultra-processed foods are aggressively marketed, especially to children. Meanwhile, fresh, nutritious food remains expensive and inaccessible to many.

For low-income populations, deep-rooted cultural perceptions that link higher body weight with prosperity add another layer of resistance to obesity prevention efforts. Even those who wish to make healthier choices are constrained by poor urban planning. Indian cities are designed for vehicles, not people. Pedestrian walkways are scarce, cycling infrastructure is almost nonexistent, and green spaces where people can exercise are shrinking daily.

To prevent obesity, India must implement strong fiscal policies that shape healthier consumer choices. Taxes on sugary drinks and subsidies for fruits and vegetables can make nutritious food more accessible and discourage excessive sugar intake. Restricting junk food marketing to children and strengthening school-based nutrition and physical education will help instill lifelong healthy habits. Additionally, urban infrastructure should be redesigned to encourage physical activity, with more pedestrian pathways, cycling tracks, and recreational spaces.

Beyond policies, public awareness and cross-sector collaboration are essential. Culturally sensitive campaigns in schools, workplaces, and mass media can reinforce healthy behaviors. Technology can support weight monitoring, virtual counseling, and digital health services. Meanwhile, health, education, and urban planning must align efforts to create environments that support active lifestyles. The private sector should also be engaged in food reformulation and improved labeling to empower consumers.

Obesity care must be integrated into primary healthcare for early diagnosis and treatment. Ayushman Bharat Health and Wellness Centres should offer BMI screenings and trained counseling. Establishing referral pathways for specialised care and expanding dietitians and bariatric surgeons will improve access. Finally, affordable treatments, regulated therapies, and evidence-based interventions are key to ensuring effective obesity management.

By 2050, a third of India’s population could be obese. Yet India still lacks a national obesity registry, and prevention remains an afterthought (11).

The real question is not whether we should act on obesity but why we have not already. Will the country wait until this crisis spirals out of control, or will it take decisive action now? This World Health Day, India must stop seeing obesity as a secondary issue and start treating it like the public health emergency it truly is.

References:

1. Ministry of Health and Family Welfare, Government of India. 2021. National Family Health Survey (NFHS-5), 2019–21. https://mohfw.gov.in/sites/default/files/NFHS-5_Phase-II_0.pdf.

2. Pradeepa, R., and V. Mohan. 2021. “Epidemiology of Type 2 Diabetes in India. Indian Journal of Ophthalmology 69 (11): 2932–38. https://doi.org/10.4103/ijo.IJO_1627_21.

3. Okunogbe, A., R. Nugent, G. Spencer, J. Powis, J. Ralston, and J. Wilding. 2022. “Economic Impacts of Overweight and Obesity: Current and Future Estimates for 161 Countries. BMJ Global Health 7 (9): e009773. https://doi.org/10.1136/bmjgh-2022-009773.

4. Ng, Marie, et al. 2021. “Global, Regional, and National Prevalence of Adult Overweight and Obesity, 1990–2021, with Forecasts to 2050: A Forecasting Study for the Global Burden of Disease Study 2021. The Lancet 405 (10481): 813–38.

5. Ministry of Health and Family Welfare, Government of India. 2025. National Programme for Prevention & Control of Cancer, Diabetes, Cardiovascular Diseases & Stroke (NPCDCS).

6. Mello, Michelle M. 2009. “New York City’s War on Fat. New England Journal of Medicine 360 (19): 2015–20. https://doi.org/10.1056/NEJMhle0806121.

7. Rogers, N. T., S. Cummins, H. Forde, C. P. Jones, O. Mytton, H. Rutter, S. J. Sharp, D. Theis, M. White, and J. Adams. 2023. Associations between Trajectories of Obesity Prevalence in English Primary School Children and the UK Soft Drinks Industry Levy: An Interrupted Time Series Analysis of Surveillance Data. PLoS Medicine 20 (1): e1004160. https://doi.org/10.1371/journal.pmed.1004160.

8. Jones-Smith, J. C., M. A. Knox, S. Chakrabarti, et al. 2024. Sweetened Beverage Tax Implementation and Change in Body Mass Index Among Children in Seattle. JAMA Network Open 7 (5): e2413644. https://doi.org/10.1001/jamanetworkopen.2024.13644.

9. Ministry of Health and Family Welfare, Government of India. Food Standards and Safety Authority of India (FSSAI). https://eatrightindia.gov.in.

10. National Health Authority, Government of India. Ayushman Bharat Digital Mission. https://abdm.gov.in/abdm-components.

11. Kerr, Jessica A., et al. 2021. Global, Regional, and National Prevalence of Child and Adolescent Overweight and Obesity, 1990–2021, with Forecasts to 2050: A Forecasting Study for the Global Burden of Disease Study 2021. The Lancet 405 (10481): 785–812.

The blog was first published on Express Healthcare on 16th May 2025.