Supporting the digitization of micro-enterprises in Brazil’s favelas

Our programs

Training, gamification, and mentoring promote the adoption of digital tools and facilitate access to credit.

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Why this program?

  • 41% of the 17.1 million people living in favelas own a business. These micro-enterprises provide jobs that serve as a critical source of income for millions of low-income people. 
  • The main challenges for businesses in favelas include access to capital (40%), lack of skills and tools for financial management (14%), pricing strategies (14%), and digital marketing (14%). These challenges hamper businesses’ resilience and ability to grow.
  • During the COVID-19 pandemic, many small businesses in favelas closed or had their revenues drastically reduced. Only 23% managed to transition their work online.
  • Favelas represent tremendous economic potential, generating US$35 billion in annual revenue. They are also increasingly digital—87% of favela residents go online weekly. These communities have huge potential to be engines of economic growth.
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Program overview

The program will support the digitization of 500,000 micro-enterprises in favelas across Brazil. It will combine training, gamification, and mentoring to promote the adoption of digital tools and facilitate access to credit by small businesses.

By specifically focusing on the needs and pains of four small business segments that will be identified through extensive research across a selection of Brazilian favelas, the program will hone in on the specific triggers that can drive behavior change. These insights will enable implementation partners to co-design packages of solutions to promote upskilling, as well as encourage business owners to adopt the right package of digital tools to sustain their growth and build resilience. 

The program brings together three highly skilled and experienced implementation partners that are uniquely positioned to deliver this multifaceted program.

  • Central Única das Favelas (CUFA) is deeply immersed in and well-trusted by favela communities in Brazil. It will activate its network of community leaders and intermediaries to provide high-touch onboarding for business owners, and ensure the approach truly speaks to their needs. It will also leverage its network of private and institutional partners to maximize the program’s reach and impact. 
  • Aliança Empreendedora has worked with thousands of vulnerable small businesses across Brazil, and so brings experience with delivery across digital channels—from dedicated platforms to WhatsApp chatbots—and a unique methodology that combines upskilling and empowerment. It will tailor new and existing content, test delivery approaches, and provide mentoring to small business owners. Aliança Empreendedora is highly respected in Brazil’s digital inclusion landscape, so it is well-placed to broker new partnerships with digital players, fintechs, and institutional actors to test digital solution and engagement approaches.
  • Flourish FI will apply its technology, which uses behavioral science to inform gamification techniques and nudges that empower people to build positive money habits and achieve financial security. Flourish’s existing technology has been tried-and-tested extensively with consumers, in partnership with several leading banks. This program will involve adapting this technology for small businesses, to empower them to build positive financial habits. Business owners that transition from upskilling to behavior change and tool adoption will receive mentoring and access to credit. 

Through this program, Strive Community’s Innovation Fund grantee, XR Global, will test the efficacy of augmented reality training for upskilling small businesses. Read more about that here.

About Aliança Empreendedora

Aliança Empreendedora believes that everyone can be an entrepreneur and that inclusive entrepreneurship is a powerful tool to lift people out of poverty and build prosperity. Since 2005 the organization has directly supported 140,000 micro-entrepreneurs in vulnerable communities in every Brazilian state, generating income, work opportunities, and productivity. Their work consists of empowering, training, and connecting micro-entrepreneurs by delivering projects with relevant content, classroom training, online learning (through their Tamo Junto platform), mentoring (through their Guru de Negócios platform), and inclusive business models, including connection to major commercial value chains, connection to credit, and advocacy.

Aliança Empreendedora has replicated its methodology around the country through a network of 137 organizations and has successfully developed more than 200 projects in partnership with more than 100 partners, including Santander, Facebook, Telefonica Foundation, the Mastercard Center for Inclusive Growth, Bank of America, Unilever, and Danone, among others. The organization has been recognized nationally and internationally with more than 15 awards. It recently acted as an important advocate for micro-entrepreneurs by building strategic partnerships with three ministries at the federal level (Ministry of Women, Family and Human Rights, Ministry of Economy, and Ministry of Social Development).

About CUFA

Central Única das Favelas (CUFA) is a Brazilian nonprofit organization founded 20 years ago to represent and promote the interests of the estimated 17 million people living in over 5,000 favelas in Brazil, equivalent to approximately 8% of the population. 

Recognized both nationally and internationally in the fields of social assistance and community development, CUFA promotes activities in the fields of education, recreation, sports, culture, and citizenship focusing on capacity building, empowerment, and dissemination of cultural content produced by residents of favelas. 

In this way, CUFA intends to expand its reach and means of communication and expression, disseminating awareness and opportunities among underprivileged segments of the population through professional qualification workshops and a series of other activities which raise the self esteem of marginalized youth by opening opportunities for knowledge and new perspectives. Since 1999, CUFA has supported citizens of Rio de Janeiro as well as the other 26 Brazilian states and is present in countries such as Bolivia, Germany, Chile, Hungary, Italy, and the USA. The CUFA team is mostly composed of young people who were trained by the organization and are themselves mostly residents of favelas. 

About Flourish FI

Flourish FI’s mission is to empower all people to build positive money habits and achieve financial security. In collaboration with top behavioral scientists and data experts, they are building the next generation of engagement tools to help underserved individuals and businesses build resilience and achieve financial freedom. They combine proven gaming mechanics and a nudging system that encourages people and small businesses to transact, build habits of saving money, pay bills on time, create credit history, adopt digital products, and spend smartly—all while learning healthy financial habits in their day-to-day money decisions.

Flourish has clients around the Americas, including Brazil, USA, and Bolivia. One of their flagship customers, Banco Solidario, is a renowned microfinance institution in Bolivia. Flourish FI is one of the winners of Strive Community’s Innovation Fund. Learn more about their Innovation Fund work here.

Micro-enterprises are the backbone of favela communities in Brazil, providing jobs that serve as a critical source of income for millions of people. By equipping business owners with the right digital tools, we want to enhance their ability to promote inclusive growth where it is needed most.

Luz Gomez

Vice President, Latin America & the Caribbean, Mastercard Center for Inclusive Growth

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Implementation partners
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