1

MAKING THE SHIFT FROM FINANCIAL 

EDUCATION TO FINANCIAL CAPABILITY: 

Evidence from the Financial Capability Innovation Fund

By: Joshua Sledge, Analyst, Innovation and Research

Sarah Gordon, Director, Advisory Services and Nonprofit Investments 

Matthew Knisley, Program Assistant

© 2011, Center for Financial Services Innovation
2

EXECUTIVE SUMMARY

The need for new ideas to improve Americans’ financial 

capability has been evident throughout the recent 

recession. Never before have Americans been so highly 

motivated to improve their financial behavior. At the 

same time, many people are confronting foreclosure, 

unemployment or other ills related to the downturn that 

impede behavioral change. As new financial products 

and services emerge, and as financial service providers 

respond to the new economic and regulatory environment, 

consumers need better guidance to make wise financial 

decisions.

In response to this growing need, the Center for Financial 

Services Innovation (CFSI) launched the Financial 

Capability Innovation Fund (FCIF). We issued a Request for 

Proposals in late 2010 from nonprofit applicants interested 

in creating new and innovative financial capability 

interventions. A collaborative of funders led by the Citi 

Foundation and also including Bank of America, Capital 

One, Morgan Stanley, Experian, U.S. Bank and Visa Inc. 

provided a total of $1.5 million in available grant funding. 

Applicants were encouraged to develop programs in 

partnership with organizations in the nonprofit, for profit, 

or government sectors. We planned to award four to six 

grants ranging from $200,000 to $300,000 each, giving 

priority to programs that coupled financial products and 

services with education; leveraged technology; and applied 

behavioral economics concepts to positively affect financial 

behavior.1

We received 246 proposals totaling more than $67 million 

in requests from nonprofit organizations across the 

country. Five were chosen for funding: 

• Consumer Credit Counseling Service of Delaware 

Valley, which will test whether social commitments 

and text alerts can help consumers reduce debt. 

• Co-opportunity Inc., which will leverage technology to 

enhance its volunteer budget-coaching program.

• Filene Research Institute, which will test whether 

rewards for timeliness can improve loan repayment 

behavior.

• Mission Asset Fund, which will franchise its Cestas 

Populares peer loan program to help immigrants build 

credit and manage credit wisely.

• Grow Brooklyn and Piggymojo, which will help lowincome savers turn impulse buys into impulse saves.

As we reviewed the proposals, we realized they were 

not just part of a selection process. Collectively, these 

proposals reveal the way nonprofits are thinking about 

financial capability today. In particular, the proposals 

highlighted (1) cross-sector partnerships, (2) improved 

saving behavior, (3) an interest in scaling financial 

counseling and coaching programs, and (4) the use of 

incentives to drive behavior change. 

This paper explores common themes among the proposals 

and recommends ways nonprofits could enhance their 

financial capability programs for greater effectiveness.

1 For a full listing of FCIF selection criteria and priorities, see the 

original RFP at http://cfsinnovation.com/node/440613.
3

INTRODUCTION

In response to the economic downturn and volatility in 

the financial services industry, Americans are placing 

a higher priority on sound financial management. Yet 

simultaneously, those same economic factors make it 

harder to adopt sound practices. For many, attempts to 

shore up their financial health have been derailed by 

financial challenges such as foreclosure, unemployment or 

other ills related to the downturn. Although new financial 

products, providers, and distribution channels are emerging 

to help consumers gain greater financial control, these 

new offerings complicate consumers’ choices. In this 

environment, consumers need additional and improved 

guidance that will help them act on their desire to improve 

their financial management skills and access the tools they 

need. 

The financial education field has long worked to equip 

Americans with useful financial knowledge. But the 

traditional financial education approach may need to 

be revisited in this volatile environment. Organizations 

in the field are adopting the broader framework of 

“financial capability,” extending their efforts beyond the 

classroom to help people more directly translate financial 

knowledge and guidance into better financial behavior in 

their everyday lives. Specifically, the financial capability 

framework targets the following behaviors:

• Being able to cover monthly expenses with income

• Tracking spending

• Planning ahead and saving for the future

• Selecting and managing financial products and 

services

• Gaining and exercising financial knowledge

To accomplish this goal, financial capability programs link 

financial products with financial education, ensuring that 

people gain access to safe and effective products and 

know how to use them appropriately. 

To learn what works, CFSI conducted research in early 

2010 to assess the current landscape of programs and 

providers and identify the characteristics and practices 

most likely to help consumers better their financial 

behavior. The research found that the most effective 

interventions were:

•	 Relevant, addressing participants’ specific concerns 

and financial situations,

• Timely, coinciding with key life events or moments 

of decision,

•	 Actionable, enabling consumers to put newly gained 

knowledge into action right away, and

•	 Ongoing, developing long-term relationships to 

provide support and accountability.2

It was clear that the financial capability field needed 

further innovation and development of promising ideas, 

and that there was a role for CFSI in catalyzing change 

and facilitating the shift toward the financial capability 

framework.

To explore the financial capability approach, we launched 

the Financial Capability Innovation Fund (FCIF) in late 

2010, aiming to develop and support the shift toward this 

broader framework. By providing grants to promising 

programs and evaluating their performance, we saw the 

FCIF as a way to help identify the tools and practices 

most effective in helping consumers achieve tangible 

improvements in their financial health. We also hoped 

to provide evidence for the financial capability field 

about which solutions showed the greatest potential for 

positive outcomes.

A collaborative of funders led by the Citi Foundation 

and also including Bank of America, Capital One, Morgan 

Stanley, Experian, U.S. Bank and Visa Inc. helped launch the 

FCIF with a total of $1.5 million in available grant funding. 

The Request for Proposals (RFP), issued in September 

2010, sought applications from nonprofit organizations 

interested in creating new and innovative financial 

capability interventions. Applicants were encouraged to 

develop programs in partnership with organizations in the 

nonprofit, for-profit, or government sectors. 

2 For additional information on the financial capability concept and framework, see “From 

Financial Education to Financial Capability: Opportunities for Innovation,” Center for Financial 

Services Innovation (March 2010), http://cfsinnovation.com/node/440486.

The Financial Capability Innovation Fund
4

CFSI planned to award four to six grants ranging from 

$200,000 to $300,000, giving priority to programs that

3

:

• Coupled financial products and services with new or 

improved educational tools or resources

• Leveraged technology to improve the customer 

experience or to improve the provider’s efficiency

• Applied behavioral economics concepts such as 

automation, default settings, or social commitments 

to positively affect financial behavior

We received 246 proposals totaling more than $67 million 

in requests from nonprofit organizations across the 

country. After a rigorous review process, five have been 

awarded grants: • Consumer Credit Counseling Service of Delaware 

Valley, which will test whether social commitments 

and text alerts can help consumers reduce debt. 

• Co-opportunity Inc., which will leverage technology 

via a new online platform to enhance the effectiveness 

and scale of its volunteer budget-coaching program.

• Filene Research Institute, which will test whether 

rewarding consistent timely loan payments with 

interest rate reductions improves payment behavior.

• Mission Asset Fund, which will franchise its Cestas 

Populares program, a peer loan coupled with productspecific peer-led education, to help immigrants build 

credit and manage credit wisely.

• Grow Brooklyn and Piggymojo, which will use goal 

visualization, social dynamics and mobile technology 

to help low-income savers turn impulse buys into 

impulse saves.

See the Appendix for additional information on each 

project.

Reviewing these proposals showed several prominent 

ways in which the nonprofit community is applying the 

financial capability framework. In addition to the five 

grantees, there were many other excellent examples of 

nonprofits putting the financial capability framework into 

action. This paper explores the universe of applicants 

to identify common themes within the proposals and 

highlights some of the most innovative and promising 

financial capability interventions submitted to the FCIF. 

continued, The Financial Capability Innovation Fund

3 For a full listing of FCIF selection criteria and priorities, see the original RFP at 

http://cfsinnovation.com/node/440613.
5

The Financial Capability Innovation Fund is the fourth CFSI 

grant program to choose grantees via a competitive RFP 

process. Through the previous three grant funds, we have 

provided a total of $2.25 million in grants to nonprofits 

working to improve and increase the supply of financial 

products and services for underbanked and low-income 

consumers. The FCIF represented a shift in focus, as we 

sought to support the development of educational tools 

that, when offered in conjunction with well-structured 

products, would help consumers improve their financial 

behavior.

The 246 proposals submitted for the Financial Capability 

Innovation Fund were the most we have ever received 

for a granting initiative — an 85 percent increase over 

the 133 proposals submitted to CFSI’s 2008 Nonprofit 

Opportunities Fund.4 Similarly, the approximately 

$67 million in total funding requested in the proposals 

represented a 124 percent increase over the $30 million 

requested during the 2008 RFP process.

The increase in proposals was encouraging, as was the 

number of proposals received from new applicants. 

Ninety-one percent of the proposals came from 

organizations that had not applied to the 2008 Nonprofit 

Opportunities Fund. The majority of the applications were 

submitted by community organizations and social service 

agencies (see Chart 1). Fifty-four percent of the applicants 

sought funding for entirely new projects, and 38 percent 

applied for funding to enhance an existing program.

Chart 1: Proposals by Organization Type

Applicants primarily targeted their services toward 

demographic groups or sought to serve clients facing a 

particular life situation (e.g., homelessness or single 

parent). Chart 2 and Table 1 highlight various populations 

targeted in the proposed programs submitted to the FCIF.

Chart 2: Proposals by Target Population

Table 1: Notable Targeted Populations and Life 

Circumstances

2%

2%

7%

12%

0% 5% 10% 15%

Native Americans

Asian/Pacific Islanders

African-Americans

Hispanic

% of total proposals

Race/Ethnicity

Targeted Race/Ethncity

2%

21%

77%

0% 20% 40% 60% 80% 100%

Seniors

Youth (<25 years)

Adults*

% of total proposals

Age Group

Targeted Age Group

 Population % of Proposals 

 Un/Underemployed 5%

 Disabled 3%

 Single Parents 3%

 Homeless 3%

 Immigrants 3%

 Older Population 2%

 Ex-convicts 2%

 Domestic Abuse Victims 2%

 Expectant Mothers 1%

What We Saw: The Proposals

Community 

Organization / 

Social Service 

Agency

77%

Other

6%

Credit Counseling 

Agencies

4%

Foundations

4%

Coalitions

4%

Nonprofit Loan 

Funds

3%

Credit Unions & 

Nonprofit 

Affiliates

2%

4 For more information on the 2008 Nonprofit Opportunities Fund, see the Grantee Learning Briefs, 

http://cfsinnovation.com/node/440436, and “Nonprofit Innovations for the Underbanked: Trends 

& Developments” (September 2008), http://cfsinnovation.com/node/330430.

*Proposals without a specific mention of age were assumed to be targeted

toward adults
6

Most notably, however, approximately 10 percent of 

proposals defined their target population by their financial 

situation — a valuable strategic approach to segmentation. 

By defining target populations in this way, nonprofits could 

focus on helping clients adopt distinct financial behaviors 

addressing specific aspects of their financial capability. 

For example, a program targeting people with little to no 

retirement savings could focus on helping them begin to 

plan and save for the future and connecting them with an 

IRA. Similarly, targeting clients who are new to credit 

creates an opportunity to help them build their credit with 

such products as credit builder loans or secured credit 

cards. 

The proposals shared several common themes that, taken 

together, reveal insights into the nonprofit community 

active in the financial capability field. In particular, the 

proposals highlighted (1) cross-sector partnerships, 

(2) improved saving behavior, (3) an interest in scaling 

financial counseling and coaching programs, and (4) the 

use of incentives to drive behavior change.

Pairing financial education with access to financial 

products is a key component of the financial capability 

framework. By linking products with guidance on using 

them, providers can offer consumers tools to change their 

behavior for the better. For nonprofit organizations, this 

link is often created by forming partnerships with for-profit 

financial services providers, with the nonprofit offering 

education or counseling while the for-profit offers related 

products. While such arrangements may create challenges 

for nonprofits — for instance, ensuring products made 

available to clients are fairly priced and come with 

appropriate consumer protections—well-structured 

partnerships between nonprofits and product providers 

can help clients access the tools they need to improve 

their financial capability.

Because we encouraged FCIF applicants to form crosssector partnerships as a part of their proposals, most did 

so. In fact, 96 percent of the proposals featured at least 

one partnership and 85 percent featured a partnership 

with at least one financial services provider. By contrast, 

only 80 percent of the proposals received for the 2008 

Nonprofit Opportunities Fund involved partnerships, with 

only 35 percent featuring partnerships with a financial 

services provider. While the difference may reflect each 

fund’s particular focus, the increase in partnerships with 

financial services providers suggests that nonprofits now 

have a greater interest in integrating financial products into 

their programming. Chart 3 presents a closer comparison 

between the partnerships featured in proposals to the 

two funds.

Chart 3: Partnerships with Financial Services Providers – 

2008 vs. Current

Note: Many organizations in the 2010 FCIF had multiple financial service providers

as partners.

21%

12%

2%

56%

28%

41%

0%

10%

20%

30%

40%

50%

60%

Banks Credit Unions Other

% of total proposals 

Partnerships with Financial Services Providers

2008 Nonprofit Opportunities Fund 2010 Financial Capability Innovation Fund

Sidebar 1: Geography

In total, proposals were received from 44 states as well as Washington, 

D.C. Most submissions proposed local interventions versus multi-state 

or national programs.

Despite the geographic diversity of the proposals, only 12 percent 

focused on clients in rural areas. This represents a potential gap 

in the financial capability field. As clients in rural areas often face 

unique financial challenges (e.g., limited presence of bank branches), 

more targeted interventions may be needed to ensure they have the 

support and access to products they need to build financial capability. 

continued, What We Saw: The Proposals Partnerships

Local

73%

National

10%

Other

10%

State or 

Regional

7%

Geographic Scope of Proposals

South

34%

West

24%

Northeast

21%

Midwest

21%

Diversity of Regions Represented
7

Of particular note, FCIF applicants were much more likely 

to form partnerships with nonbank organizations, such as 

prepaid card companies and credit bureaus. The proposals 

demonstrated an increased tendency to look beyond 

the traditional banking menu for products that might be 

helpful to clients. By incorporating alternative products into 

their proposals, nonprofits could offer underbanked clients 

the products with which they were familiar — effectively 

“meeting clients where they are,” in an effort to move 

them toward better decisions and behavior. 

For example, the San Francisco-based Mission Economic 

Development Agency (MEDA) partnered with Nexxo 

Financial, a remittance services provider, on a program 

to help low-income underbanked Latinos reduce debt, 

improve their credit scores, and increase savings. Under the 

proposed partnership, Nexxo would add targeted messages 

to its remittance receipts, encouraging customers to seek 

out MEDA’s free tax preparation and financial education 

services. Customers who acted on the advice would not 

only receive the advertised services, but also be introduced 

to other potentially beneficial products, such as savings 

accounts and credit-builder loans. 

Relative to the 2008 fund, FCIF applicants were more 

likely to form partnerships with a wide spectrum of 

organizations. But more is not always better. However, 

many proposals featured a high number of partnerships, 

often resulting in programs that lacked focus. On average, 

such proposals had seven partners. Conversely, proposals 

that demonstrated a more focused approach, addressing 

targeted specific behaviors averaged only three partners. 

Nonprofits with focused proposals had a firm grasp of 

their organization’s strengths and core competencies and 

the ability to recognize areas in which they were not 

well positioned to provide a particular service. Strategic 

partnerships enabled these organizations to focus on their 

strengths while simultaneously providing clients with a 

broader range of services or products.

Nonprofit organizations have been providing in-person 

financial counseling and coaching services to millions of 

low- and moderate-income American consumers each 

year,5 often at little or no cost. While this deep level of 

engagement may help change behavior, it can be also be 

very costly. Relying on grant and subsidy funding can put 

financial pressure on counseling and coaching models, 

limiting their ability to grow and challenging their longterm sustainability.

A number of organizations applying to the FCIF sought 

to supplement the in-person experience with more costeffective forms of ongoing support, better enabling them 

to scale. In most cases, these tools were used to maintain 

frequent contact with clients for ongoing guidance. 

Online channels — such as personal financial management 

sites —were also employed to help clients keep track of 

their progress toward financial goals. By using online and 

mobile channels to carry out support services that are 

traditionally part of in-person interventions, organizations 

can gain efficiency and serve more clients.

Some organizations found ways to increase efficiency 

by inserting coaching services into pre-existing client 

interactions and programming. In conjunction with its 

partner credit union, Credit Where Credit Is Due 

(CWCID), a New York City-based organization, submitted a 

proposal to turn the credit union’s first contact with new 

customers into a brief financial coaching session. Member 

services representatives, who acquaint new customers 

with the credit union, would be trained to engage clients 

in a discussion about their financial health during the 

orientation process. Additionally, new members would 

automatically be placed into a goal-based savings program 

unless they opted out. By rethinking its partner credit 

union’s existing orientation process, CWCID created an 

efficient way to provide financial coaching.

Organizations working to build scalable and efficient 

models of financial coaching and counseling are making 

a meaningful contribution to the financial capability field. 

By using technology and restructuring client interactions 

to maximize efficiency, nonprofits can test new tools and 

techniques to determine their ability to increase scale 

while maintaining high client impact.

Savings stood out as a particular area of interest and 

innovation for applicants, with 51 percent of proposals 

including a link to a savings product. A focus on savings 

is hardly new. For example, nonprofits have led the 

movement to use Individual Development Accounts 

(IDA) as a means of helping underserved consumers save 

Savings

5 Financial coaching and counseling programs provide clients with highly individualized guidance 

and support in their pursuit of improved financial health. Counseling services typically help clients 

respond to a financial problem, while coaching services generally help clients reach financial goals.

Next Generation of Financial Counseling

continued, What We Saw: The Proposals
8

money and build assets. Applicants to the FCIF showed 

interest in a wide variety of products and practices to 

facilitate savings. For instance, several organizations 

created programs to capitalize on newly amended tax 

forms that now offer the option to purchase savings bonds 

with refunds. For organizations offering tax preparation 

services, this option creates an opportunity to talk to 

clients about the importance of saving and allows clients 

to act immediately by purchasing bonds. Examples of 

proposals highlighting innovative savings interactions 

include:

• Based in San Jose, CA, Opportunity Fund proposed a 

partnership with Citi to help low-income consumers 

build up “buffer” savings as a cushion in case of 

financial emergencies. Participants would develop 

a plan to save $500 within two years, with each 

contribution matched 2:1 by Opportunity Fund. 

Opportunity Fund would send mobile alerts with 

reminders about upcoming scheduled contributions 

and warnings about missed deposits. 

• EARN, a San Francisco-based nonprofit, also focused 

on facilitating short-term emergency savings, 

proposing a scalable card-based savings product 

instead of a traditional account at a physical bank 

branch. To encourage clients to participate, EARN 

would incorporate a prize-linked savings element into 

the program, drawing from the Doorways to Dreams 

(D2D) Fund’s pioneering Save to Win program in 2008-

2009.6 For extra motivation, a savings contribution of 

a specific size would earn a client a ticket in a raffle for 

large prizes or cash awards. 

• The MPower Foundation proposed to go beyond 

savings and offer an investment product to assetpoor clients. The proposed program centers on 

a partnership with Gratio Capital, an investment 

company with a simplified investment product named 

GoalMine. Clients could contribute amounts as small as 

$25 to a GoalMine account, with the proceeds invested 

in mutual funds. For agreeing not to withdraw money 

from the account for two years, consumers would gain 

principal protection, ensuring that they would not 

suffer a loss and providing an incentive to let funds 

accumulate.

Applicants frequently proposed incentives to encourage 

better financial behavior. Almost one-third of the proposals 

involved incentives, virtually all of them cash-based. 

Common incentives included matched savings for opening 

new accounts and cash or prizes for participating in 

workshops and completing program evaluations. Cashbased incentives may be persuasive, however, they can 

become too costly over time. Several proposals suggested 

noncash incentives or incentive structures that were more 

sustainable or cost-effective. Many provided incentives 

for improvements in financial behavior. For example, they 

might reward on-time payments rather than attendance 

at a financial literacy workshop. Incentives linked to a 

particular behavior (e.g., making regular contributions 

to savings) can be effective in pushing clients to convert 

newly acquired knowledge into actions that improve their 

financial health.

Demonstrating the use of sustainable and behaviorally 

linked incentives, The Filene Research Institute has 

developed the Low Interest for Timeliness (LIFT) project. 

In partnership with credit unions across the country, the 

LIFT project would help subprime credit consumers build 

financial capability by rewarding consistent timely loan 

payments on automobile loans. Using web-based tools to 

automate administration, LIFT would enable consumers to 

earn APR reductions for each year of on-time payments. 

The interest rate savings go to principal, reducing the 

life of the loan. LIFT focuses borrowers on the goal of 

making on-time loan payments supported with an explicit 

and sustainable financial incentive. 

These four themes — partnerships, next generation 

of financial coaching, savings, incentives — show how 

nonprofits are thinking about financial capability today. 

The next section explores the key priorities outlined in the 

RFP — priorities that we believe are critical to the field’s 

future success — and the ways applicants responded to 

them. 

continued, Incentives

6 For additional information on D2D’s Save to Win Program, see “Save to Win: 2009 Final 

Project Results,” Doorways to Dreams Fund (2010), http://www.d2dfund.org/system/files/

Save+to+Win+Final+Report.pdf.

Incentives
9

The RFP highlighted several key grant priorities and 

selection criteria that CFSI’s research had identified as 

promising. In particular, we were interested in proposals 

that embodied the financial capability approach by:

• Incorporating the elements of effective financial 

capability programs (relevant, timely, actionable, 

ongoing).

• Demonstrating the ability to scale.

• Coupling financial products/services with new or 

improved education tools or resources.

• Leveraging technology to improve the customer 

experience or to improve the provider’s 

efficiency.

• Applying behavioral economics concepts 

such as 

automation, default settings, or social 

commitments to positively affect behavior.

Applicants varied in the degree to which they 

proposed interventions that aligned with 

CFSI’s key criteria. Certain strategies were 

incorporated into the proposals more than 

others, suggesting room for further growth in 

the financial capability field. However, for each 

of the highlighted areas of interest, we also 

received proposals that stood out as prime 

examples of how these strategies could be 

employed. These proposals both reflected a 

deep understanding of the financial capability 

framework and demonstrated how it could be applied to 

generate positive consumer outcomes.

Of particular interest were interventions that linked 

education efforts with related financial products. Creating 

this connection helps to facilitate behavior change as 

clients receive both the guidance and tools they need to 

take a step toward improving their financial behavior. 

The vast majority of applicants (85 percent) incorporated 

financial products into their interventions through 

partnerships with financial services providers. 

However, the degree to which financial products were 

linked to education efforts varied widely across the 

proposals. For instance, some organizations created a 

link to products simply by referring clients to a local 

bank, requiring them to take the next step on their own 

and visit a branch to open an account. On the opposite 

end of the spectrum, several nonprofits actually served as 

a distribution point for products, enabling the 

organizations to offer and open accounts during their 

client interactions. Figure 1 charts the proposals along a 

range of “product engagement,” displaying the degree to 

which products were integrated into education efforts.

Figure 1: Product Engagement Continuum

As the chart demonstrates, 70 percent of the proposed 

interventions were limited to either providing general 

information about or referrals to products clients should 

seek out on their own. While such programs define next 

steps, they don’t necessarily help clients take them. 

This makes it more likely that clients will fail to convert 

knowledge (e.g., knowing a savings account is beneficial) 

into behavior (e.g., opening and contributing to a savings 

account). Only 25 percent of applicants created programs 

in which clients could receive education and access 

products at a single location. Yet these more integrated 

programs are more likely to change behavior, because 

they reduce the steps clients need to take to put their new 

knowledge into action.

Note: 5% of proposals were either unclear about their degree of engagement or were

only involved in product development.

RFP PRIORITIES

Access + Education

7%

15%

32%

16%

9%

5% 4%

7%

No product link General product info Specific product info; 

referrals to approved 

list of products (nonexclusive)

Direct referral 

(exclusive)

Providers come 

onsite to offer 

products

Nonprofit enrolls 

clients for others' 

products

Nonprofit distributes 

others' products 

(enrollment plus)

Nonprofit provides its 

own 

products/services

ACTIONABILITY

Info/Education Referral Distribution Service 

Provision
10

In particular, proposals incorporating the use of “in-line 

messaging” — advice provided within the context of a 

financial services transaction—exemplified effective ways 

to link education and products. This approach requires 

nonprofits either to be affiliated with a financial services 

provider or to build a partnership incorporating financial 

education into the transaction process. Examples of this 

approach within the proposals include:

• Self-Help Economic Development, Inc., a nonprofit 

community development financial institution, proposed 

to further develop the in-line messaging efforts at its 

Micro Branch outlet in San Jose, CA. Launched in 2010, 

the Micro Branch is described as a check-casher and 

credit union hybrid designed to meet the needs of 

unbanked and underbanked families. By incorporating 

financial education messages in posters within the 

Micro Branch and training tellers to guide customers 

toward better products and decisions, Self-Help offers 

advice in a setting that allows customers to act upon it. 

Self-Help aimed to use in-line messaging to encourage 

customers to open and increase balances in My Piggy 

Bank savings accounts, which require them to set a 

date before which funds cannot be withdrawn.

• Seeking to transform check-cashers to savers, the Latino 

Economic Development Corporation proposed an 

in-line messaging intervention for its Community 

First Financial Center. Underbanked Latinos visiting 

the center to use its check-cashing services would 

be encouraged to open a savings account into which 

5 percent of their future cashed checks would be 

deposited and matched 1:1. Financial counselors would 

open the accounts, using the opportunity to engage 

customers in a discussion about their financial health.

• Lutheran Social Service of Minnesota proposed 

integrating messaging and educational content into 

customer transactions at its sister financial services 

outlet, the Eastside Financial Center. The organization 

sought to create a new suite of products to which 

cash-based customers could be referred. Tellers 

would be trained to offer advice and products with 

direct applicability to the particular transaction being 

conducted, providing customers with “just-in-time” 

guidance they could act on right away. 

In each of these examples, tellers effectively act as 

financial coaches, pointing customers toward beneficial 

decisions and products. Unlike more traditional forms of 

in-depth counseling, tellers provide bits of advice, but do 

so each time the customer visits. Over time, these “bitesized” interactions can lead customers to make small 

decisions that collectively have a meaningful impact on 

their financial health.

Creating a tighter link between education and 

corresponding products—whether through in-line 

messaging or closer relationships with partnering financial 

services providers —tends to give financial capability 

programs greater impact, but does come with challenges. 

In particular, nonprofits may feel that a close relationship 

with a single financial services provider might be perceived 

as a conflict of interest. Being transparent about the 

relationship with the provider may help to alleviate such 

concerns. Organizations may also feel ill equipped to vet 

product offerings, negotiate relationships with financial 

services providers, and effectively market and distribute 

products to their clients. These are important concerns that 

nonprofits should consider carefully before entering into 

such a partnership.

Most proposals clearly embodied one or more of the 

elements of effectiveness identified in our research on 

financial capability. That is, they were relevant, timely, 

actionable, and/or ongoing. Below are several particularly 

astute ways in which these components were reflected in 

proposals. 

Relevant: relating to consumers’ lives and concerns

• Residents on rural Native American reservations often 

struggle with high energy costs in the winter. Four 

Bands Community Fund proposed to address financial 

capability through education about reducing energy 

costs. As a certified Native Community Development 

Financial Institution, Four Bands would provide savings 

incentives and loan products to help clients obtain 

energy-efficient appliances while also helping them 

learn how to save on energy. 

• The Mission Asset Fund addresses a target population’s 

needs within a familiar context. The organization’s 

proposal sought to formalize peer lending and savings 

circles, known as cestas, which are common practice 

Elements of Effectiveness

continued, Access + Education
11

in many immigrant communities. By channeling the 

cestas’ payment activity through partnering financial 

institutions, the Mission Asset Fund would help 

individuals build credit history without disrupting 

established practices already accepted by the group. 

Timely: coinciding with key life events or moments of

 financial decision

• Heartland Human Care Services proposed talking 

with low-income expectant mothers in health clinics 

about opening a savings account for their soon-to-bedelivered child. The organization recognized that the 

right time to approach clients about saving for their 

child was before the birth, because after the birth the 

mothers would focus on caring for their babies.

• The Center for Economic Progress aimed to capitalize 

on a significant moment by adding guidance and 

education about responsible credit use to its efforts 

to assist low-income high school students through the 

student loan process. In helping students review their 

options, CEP would have the opportunity for a deeper 

conversation about managing credit of all types.

 Actionable: allowing consumers’ to put newly gained 

knowledge into immediate action

• To create an actionable intervention, D2D expanded 

on its work in creating “financial entertainment”— 

casual video games imparting lessons of financial 

management. D2D proposed to incorporate offers from 

financial institutions within its games, allowing users 

to obtain the products they need to act on lessons 

learned while playing games.

 Ongoing: helping consumers through the process of 

 behavioral change

• The Mission SF Community Financial Center created 

the MY Path program for underserved youth in city 

employment programs with features designed to offer 

ongoing support throughout the summer and 

academic year. MY Path uses periodic in-person 

meetings, peer counseling and social media platforms 

to create accountability and provide guidance 

for students as they pursue savings goals over an 

extended period. 

Most of the proposals incorporated several of CFSI’s 

elements of effectiveness but not all four of them. This 

sampling is understandable as designing an intervention 

that can be relevant, timely, actionable, and ongoing can 

be challenging. However, nonprofits should strive to 

incorporate all four elements of effectiveness into their 

interventions to maximize their impact.

As the need for greater financial capability grows in 

the face of a recovering economy and rapidly evolving 

financial services industry, it becomes increasingly 

important that tools and resources have the ability to 

serve large numbers of consumers. With this dynamic 

in mind, we expressed a specific interest in scalable 

programs that could be expanded efficiently. Scalable 

programs typically leverage technology to serve larger 

audiences or develop a replicable model that other 

organizations can adopt. 

Key to developing scale is the ability to serve clients costeffectively. Programs that require significant funds to serve 

each client may have limited growth potential. The chart 

below shows the distribution of proposals by the amount 

of funds they budgeted for each client they intended to 

serve.

Chart 4: Cost Per Participant

Proposals budgeting higher funds per client served often 

relied heavily on in-person education methods or included 

sizable financial incentives for clients. These program 

features can limit scalability as each additional client means 

greater staff costs and extra incentive payments. On the 

other hand, proposals on the lower end of the spectrum 

typically used technological and media channels, such as 

continued, Elements of Effectiveness

Scalability 

31%

12%

7% 7%

11%

32%

0%

5%

10%

15%

20%

25%

30%

35%

$0 - $200 $201 - $400 $401 - $600 $601 - $800 $801 - $1,000 > $1,000

% of Proposals

Budgeted $ per Client Served
12

online tools, text messaging, and video broadcasting, to 

deliver education and support services. Services provided 

with such tools can often be extended to additional clients 

for little to no cost, enabling a program to reach more 

people without seeking more funding. 

Co-opportunity, Inc.’s proposal provides an excellent 

example of a financial capability program taking steps 

to increase its scalability. Representing a prime example 

of the “next generation of financial counseling,” Coopportunity proposed an online site that could be used as 

a supplement to one-on-one counseling. The site, named 

iCoach2Win, would contain money management tools and 

create opportunities for clients and counselors to interact 

online. With fewer in-person client interactions, counselors 

could serve more clients, boosting the program’s scale. 

While nonprofits should seek ways to build scalable 

financial capability programs, they also must consider 

the impact of change on their effectiveness. For example, 

though providing in-person counseling may limit an 

organization’s reach, it may also lead to better outcomes 

than impersonal messages delivered through wide-reaching 

radio broadcasts. Though it can be a challenging task, 

nonprofits should push to increase the scalability of their 

programs, finding the right balance between being effective 

in facilitating behavior change and capable reaching larger 

numbers of clients.

Developments in consumer technology create 

opportunities for innovation in the financial capability field. 

The RFP indicated a particular interest in interventions 

that leveraged technology to enhance their capabilities 

and expand their reach. Collectively, the proposals 

varied in their adoption of technology. The chart below 

provides details on the types of technology reflected in the 

proposals.

Chart 5: Types of technology utilized in the proposed 

projects

On the front end, technology can create more consumer 

touch points to promote financial capability. Technology 

can also help organizations on the back end by improving 

efficiency and helping to gather relevant data. Both 

approaches can help programs achieve greater scalability.

Illustrating a front-end application of technology, Brooklyn 

Cooperative Federal Credit Union and Piggymojo have 

partnered to leverage the mobile channel to help couples 

take advantage of “impulse savings” moments to reach 

savings goals. For instance, when a person makes a decision 

that saves them money (e.g., taking public transportation 

instead of a taxi), they can text the amount of their 

savings to the Piggymojo platform, which transfers the 

saved amount into a shared savings account. At the same 

time, the person’s partner receives a text alert about the 

impulse save that encourages them to make one of their 

own. The platform allows people to immediately act on the 

good financial decisions they make in everyday life while 

encouraging their savings partners to do the same.

Take Charge America, Inc., along with Ready Financial 

Group, Inc., developed a proposal that illustrates a unique 

behind-the-scenes use of technology. Based on evidence 

of specific missteps in prepaid card use, clients are sent 

short, entertaining educational videos via email that 

provide advice on ways to improve their financial behavior. 

By using back-end tools to analyze customer data on the 

back-end, Ready Financial could identify specific missteps 

and ensure cardholders receive videos that correspond 

with their behavior and suggest a better alternative.

Continued adoption of technology and further 

experimentation to discover its most effective applications 

can help increase the scale and impact of the financial 

Leveraging Technology

Note: Some proposals included multiple tools in their interventions.

Technological Tool % of proposals

Social Media 13%

Online Financial Education Curriculum 11%

Existing personal financial management/

online banking platforms

 11%

Text Alerts 8%

New websites/online platforms 5%

Email Alerts 4%

Online Gaming 3%

Television 2%

continued, Scalability
13

capability field. However, technological tools must be 

useful to their target population. For instance, online 

tools may not be an effective way to support clients with 

limited access to the internet. This consideration will 

likely become less relevant over time as internet access 

becomes increasingly available. Nevertheless, nonprofits 

should stay abreast of technological developments as 

they incorporate technology into their financial capability 

efforts. 

Nevertheless, nonprofits should stay abreast of 

technological developments as they incorporate 

technology into their financial capability efforts.

The RFP also indicated special interest in the use of 

behavioral economics to enhance financial capability 

interventions. Behavioral economics investigates the role 

of group dynamics, cognition, and emotion in economic 

decision-making. Understanding these factors can help 

guide consumers toward certain behaviors. Tactics with 

significant potential to encourage positive behavior 

include:

• Pre-commitments, committing now to making a 

particular choice in the future — for example, 

committing in December to save a portion of a tax 

return expected in the spring.

• Social commitments, informing peers of a goal and 

progress made toward it—for example, keeping friends 

and family abreast of payments made toward reducing 

credit card debt.

• Default settings, activating particular options of a 

product or program upon enrollment, requiring the 

user to take an active step to opt-out—for example, 

setting the default on a checking account to sweep five 

percent of direct deposits into a savings account.

•	 Automation, enabling people to make a single decision 

to have recurring actions automatically taken in the 

future — for example, setting up an automatic $25 

savings contribution to occur each month. 

These tactics can be incorporated into financial capability 

programs to bolster their ability to guide consumers toward 

better behavior. For instance, Consumer Credit Counseling 

Service of Delaware Valley, in partnership with Innovations 

for Poverty Action, designed Borrow Less Tomorrow to 

apply the power of social commitments toward improving 

credit profiles. The program either sends reminders via 

text and email to encourage clients to make periodic 

payments according to their debt repayment plans or sends 

congratulatory messages when they make them. Should a 

client miss a payment, their friends and family are informed 

and asked to encourage the client to continue with the plan.

Despite their proven utility, only nine percent of applicants 

attempted to incorporate behavioral economics principles 

into their proposals. As these principles can often be 

applied by redesigning existing processes, nonprofits 

should attempt to incorporate principles of behavioral 

economics into their financial capability interventions as a 

means of boosting their consumer impact.

continued, Leveraging Technology

Behavioral Economics
14

CONCLUSION

The Financial Capability Innovation Fund asked nonprofits 

to design innovative tools and resources that would help 

to uncover effective ways to promote financial capability 

among low-and moderate-income American households. 

Collectively, the proposals show that the field is developing 

and ready for the challenge. In particular, the near universal 

ability to partner with financial services providers to create 

holistic programs demonstrates a growing capacity to 

extend financial education beyond the classroom to help 

consumers translate knowledge into behavior. 

However, there is room for further development. Greater 

use of technology and application of behavioral economics 

principles can help organizations build scalability into 

their programs while also increasing their ability to bring 

about positive consumer outcomes. And while nonprofits 

have made progress in forming relationships with financial 

services providers, there is an opportunity to develop 

the relationships further to create a tighter link between 

financial education and corresponding products. 

By taking these steps to build upon their existing work, 

nonprofits can create effective interventions and direct the 

field toward the strategies and practices with the greatest 

potential to build Americans’ financial capability. 

Sidebar 2: Evaluation

To make sure that the FCIF builds knowledge of what 

strategies best promote the financial capability of low-income, 

underserved consumers, CFSI has paired researchers with 

each funded project to conduct a robust independent program 

evaluation. The research partners include the following 

organizations: Innovations for Poverty Action (Yale University); 

the Center for Financial Security (University of Wisconsin–

Madison); the Center for Community Capital (University of 

North Carolina–Chapel Hill); and the Cesar Chavez Institute 

(San Francisco State University). 

During the selection process, research partners worked with 

the grantees to help identify potential research questions and 

methodologies. The partnerships not only yielded rigorous 

evaluation plans but also improved the overall project designs 

by sharpening their focus on specific outcomes. 
15

APPENDIX – GRANTEE DESCRIPTIONS

CFSI is pleased to support the following five innovative 

nonprofit-led projects via the Financial Capability 

Innovation Fund.

CONSUMER CREDIT COUNSELING SERVICE OF 

DELAWARE VALLEY, BORROW LESS TOMORROW (BoLT)

BoLT, a partnership between Consumer Credit Counseling Service 

of Delaware Valley (CCCS) and Innovations for Poverty Action 

(IPA), applies behavioral economics principles to increase the 

financial capability of low- to moderate-income individuals and 

families struggling with consumer debt. CCCS of DV/IPA will 

conduct a randomized-control trial in which a sample of clients 

who join the Debt Management Plan (DMP) to repay debts 

through CCCS will receive peer support and/or regular reminders 

to stick to budgets and their plans. For example, a portion of 

clients will select up to five peer supporters, such as friends or 

family members, to referee their progress. Peer supporters will 

receive updates on client progress, including notifications when 

clients miss a scheduled debt payment. Additionally, CCCS of 

DV will test the impact of regular text message reminders on 

DMP outcomes, testing variations of messaging content (e.g., 

a focus on tasks, plans, or end goals) to determine the optimal 

design of the messages. If successful, these interventions will 

assist participants in committing to the DMP, paying down debt, 

increasing credit scores, and improving financial health.

Consumer Credit Counseling of Delaware Valley website: 

http://www.cccsdv.org/

CO-OPPORTUNITY, INC., iCoach2Win

Co-opportunity, Inc., partnering with the United Way of 

Central & Northeastern Connecticut and Hello Wallet, will use 

technology to enhance the effectiveness of its existing Volunteer 

Budget Coaching Program (BCP) and position it for growth 

and replication. Co-opportunity plans to transform its current 

program into iCoach2Win.org, an online site that combines social 

interaction and money management tools with individualized 

planning and support. While the current program relies on inperson support, Co-opportunity and its evaluation partner, the 

University of Wisconsin –Madison’s Center for Financial Security, 

will test whether similar or better results can be achieved using 

a combination of in-person and online interaction and/or a 

standalone online model.

Co-opportunity website: http://www.co-opportunity.org/

 

 FILENE RESEARCH INSTITUTE, LOW INTEREST FOR 

TIMELINESS (LIFT)

The LIFT project targets low- to moderate-income customers who 

have subprime credit. LIFT supports education-to-capacity by 

rewarding consistent timely loan payments on automobile loans. 

By automating administration with new web-based tools, the 

program lets consumers earn APR reductions for each year of ontime payments. The interest rate savings go to principal, reducing 

the life of the loan. LIFT focuses borrowers on the goal of on-time 

loan payments, backed with an explicit, relevant, and sustainable 

financial incentive. Filene will conduct a national pilot with six to 

eight credit unions targeting more than 1,200 borrowers to test 

whether LIFT can ultimately improve borrowers’ credit scores and 

overall financial capability. The Center for Financial Security at the 

University of Wisconsin–Madison is the evaluation partner. 

Filene Research Institute website: http://filene.org/

MISSION ASSET FUND (MAF), CESTAS POPULARES 

REPLICATION PROJECT

Mission Asset Fund plans to franchise the Cestas Populares 

(CP) program in five San Francisco communities. The Cestas 

Populares program formalizes the financial activity that happens 

in traditional peer lending circles. Participants sign legally binding 

promissory notes agreeing to make payments towards their peer 

loans, and MAF reports payment activity to the credit bureaus. 

Cestas Populares couples a culturally relevant loan product with 

peer-led, product-centric financial education and leverages timely 

moments, such as loan origination and monthly payments, to 

communicate with borrowers. CP has achieved great success 

over the past two years in helping low-income Latino immigrants 

build credit histories, learn to use credit wisely, and increase their 

financial capability overall. In partnership with the San Francisco 

Office of Financial Empowerment (OFE), MAF will franchise this 

model to test its relevance and effectiveness in helping ethnically 

diverse participants in five communities access the financial 

mainstream. This project will also serve as a model for how to 

scale this kind of “product plus education” program at broader 

regional and national levels. The Cesar E. Chavez Institute at San 

Francisco State University is the evaluation partner.

Mission Asset Fund website: http://www.missionassetfund.org/
16

APPENDIX – GRANTEE DESCRIPTIONS

GROW BROOKLYN AND PIGGYMOJO, IMPULSE SAVING

Grow Brooklyn/Brooklyn Cooperative Federal Credit Union, 

a nonprofit, low-income designated credit union, will offer 

the Piggymojo solution to new and existing account holders 

to boost savings balances. Piggymojo uses goal visualization, 

social commitments, and mobile and online technology to help 

consumers quantify and enjoy the act of not buying. Research 

shows that impulse buying provides momentary satisfaction 

but hinders savings efforts and contributes to debt. The goal of 

the Piggymojo project is to help low-income earners increase 

their savings by motivating and enabling them to make “impulse 

saves” toward a personal goal that retains the satisfaction of 

impulse buying without the financial costs. This project will 

integrate the Piggymojo solution with Brooklyn Cooperative’s 

core platform so that the impulse save results in money actually 

moving from the user’s checking account into a savings account. 

Evaluation partner Center for Community Capital at University of 

North Carolina–Chapel Hill will study how Piggymojo promotes 

the financial capability of Brooklyn Cooperative members. 

Grow Brooklyn website: http://www.brooklyn.coop/personal/

asset-building/programs/grow-brooklyn

Piggymojo website: www.piggymojo.com
17

About CFSI:

The Center for Financial Services Innovation is the nation’s leading authority on financial services 

for underbanked consumers. Since 2004, its programs have focused on informing, connecting, 

and investing – gathering enhanced intelligence, brokering and supporting productive industry 

relationships, and fostering best-in-class products and strategies. CFSI works with leaders and 

innovators in the business, government and nonprofit sectors to transform the financial services 

landscape. For more on CFSI, go to www.cfsinnovation.com.

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