Remittances - transfers of money from foreign workers to their home countries - have been a critical means of financial support for generations. These flows have generally been conducted away from formal markets. However, as more and more workers move abroad, the volume of remittances sent back home has grown and thus become an important flow of foreign currency in many countries.

Earlier this year, the International Monetary Fund published a working paper about the evolution of capital flows to Low-Income Countries (LICs). The paper sheds light on the increasing importance of remittances in development. Although the working paper is based on shaky data (on the admission of the authors), it calculates that total capital inflows to LICs increased from 4% of LIC GDP in the 1980s to more than 10% for LIC GDP by 2006. All the net growth in these inflows is due to private sources, while official inflows remained unchanged at roughly 2% of LIC GDP.

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Guest blogger Jocelyn Wyatt works for the design firm IDEO, leading its base of the pyramid projects. Prior to joining IDEO, Jocelyn was an Acumen Fund Fellow in Kenya. She holds a MBA from Thunderbird. Jocelyn blogs at Design and Reach.

By Jocelyn Wyatt

As NextBillion.net mentioned last week, The Rockefeller Foundation and IDEO recently presented their research on how design firms can get more involved in social sector work. We presented this work in the form of a how-to guide and a workbook on how to use design to intentionally create positive social impacts and have posted the deliverables online.

Before I joined IDEO, I wondered (like most of you probably do) what application design could have to addressing some of the world’s largest problems. Tim Brown does a great job laying out the basics on design thinking in a recent article in Harvard Business Review entitled Design Thinking.

During the course of our work with Rockefeller, we had 142 conversations with social entrepreneurs, foundations, management consultants, academics, writers, and designers. What we heard over and over again was frustration with the progress in addressing the problems that we all care about and excitement about the potential of design thinking as a new approach.

Three aspects of design thinking that are particularly salient for social enterprises are empathy, prototyping, and storytelling.

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