Social Performance Indicators Blog

Support Haiti through Microfinance

Posted by: Katherine Oglietti

Following the earthquake in Haiti, we featured guest posts from Sogesol and Fonkoze affiliates because we were able to make rapid contact with them, yet these MFIs are not the only ones who need support. It is necessary to emphasize that each of the microfinance institutions in Haiti and their clients have suffered greatly as a result of this catastrophe, and each will have much rebuilding to do. They have born losses of staff members and damages to their institutions. They are struggling to overcome these heavy blows to their organizations while redoubling their efforts to provide desperately needed loans and financial services to their clients. 

Photos by Leigh Carter, Fonkoze USA

As the rubble is cleared and the dust settles, microfinance will become an essential component of the rebuilding process, helping microentrepreneurs get back on their feet. MFIs have the capacity to offer loans for rebuilding homes and businesses; the ability to offer such financing will be contingent upon a large increase in funding. Please consider channeling your support for Haiti’s continual and sustainable development through one or more of these microfinance institutions who have been working to support Haitian microentrepreneurs and families for many years. 

MIX Market has information on six microfinance institutions from Haiti. Please find below the information that we could find on each of these organizations, as well as how to contribute to their funds for relief efforts.

Announcement: Social Performance Task Force Annual Meeting

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Social Performance Task Force Annual Meeting

June 28, 2010 – July 2, 2010
Bern, Switzerland

Sponsored by the Swiss Agency for Development and Cooperation, Liechtenstein Development Service, CGAP, and the Ford Foundation

For more information, please see the attached invitation letter, city guide, and hotel reservation form.

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MFIs’ Financial Products and Services: An Overview of SP Report Data

Posted by: Taea Calcut

As mentioned in an earlier post, MFIs exist first and foremost to provide financial products and services to populations underserved or excluded by formal financial institutions. So, what have MFIs identified as the most important products and services to meet their clients’ needs?

Graph 1: Percentage of MFIs Offering Financial Products/Services (n = 166)

 

Using data from a sample of 166 MFIs that submitted social performance reports to MIX, we find that 100% of MFIs offer credit products to their clients, yet less than half currently offer additional products or services (Graph 1).  Of those MFIs that do offer additional products and services, insurance emerges as the most popular product type.

Innovating Microinsurance

Guest Post by: Craig Churchill - Head of the Microinsurance Innovation Facility, International Labour Organization (ILO)

 
MiBanco, Peru, and the insurance company it now owns, Protecta.

Craig Churchill is the head of the ILO's Microinsurance Innovation Facility, launched in 2008 with a grant from the Bill & Melinda Gates Foundation to promote better insurance products for more low-income households. In this post, he evaluates the pros and cons of implementing microinsurance policies, and offers specific guidelines that MFIs can follow to increase their leverage and negotiating power.

Many microfinance institutions (MFIs) are looking beyond credit to see what other financial services they can offer their clients, and in those discussions insurance invariably is raised as a possible option. But should an MFI get involved in offering insurance?

When microfinance institutions are interested in insurance, their primary motivation is often to reduce their credit risk in the event that borrowers or their family members experience death, illness or other losses. If insurance can help protect the households in such circumstances, it will indirectly safeguard the MFI’s portfolio.

Another significant motivation behind the interest in insurance is to improve the welfare of their clients. MFIs typically have dual missions to alleviate poverty or promote economic development while generating a profit (or covering their costs). The social mission of improving the welfare of poor households can be enhanced through the protection provided by insurance.

There are also a number of legitimately commercial reasons why MFIs might be interested in providing insurance, such as enhancing retention, improving product profitability, diversifying their income streams and reaching out to new markets.

Worse than a War Zone: Sogesol Assesses the Damage in Haiti

Guest post by: Melissa Lumpkin, ACCION International

 

Melissa Lumpkin is a member of ACCION’s Africa & Haiti Global Programs team.  Based in Washington DC, she is the project manager and board representative for ACCION’s partner in Haiti, Sogesol.  She can be reached at mlumpkin@accion.org.

Anyone who has experience living, traveling or working in Haiti will tell you that life for most Haitians is tough – and this on a good day.  The impact of last week’s earthquake has been catastrophic and the country will face immense challenges in rebuilding.

For the past decade, ACCION has worked with Sogesol, the microfinance arm of Haiti’s largest bank, to bring microfinance services and hope for a better future to Haiti’s self-employed poor. Over the past week, we’ve remained in close communication with the President and Directeur Général of Sogesol. The DG confirmed that she, along with several staff and ACCION’s resident advisor, were at the Sogesol headquarters in Petion-Ville when the earthquake hit. Fortunately, they were able to get out of the building and safely home. Yet, a disaster of this magnitude leaves no one untouched – all have lost many close friends and witnessed widespread destruction. Our own resident advisor wrote, “Melissa, the conditions here in Haiti are unimaginable. Please… whatever ACCION can do to help.  It is worse than a war zone.”