Posted by: Mike Krell
With the development of social audits, social ratings and reporting standards, social performance assessment has dramatically evolved during the past few years. CERISE has gathered a database that contains the results of 287 SPI audits from 223 institutions in 53 countries and that presents a huge potential for taking stock of the social dimension of microfinance practices worldwide.
Posted by: Mike Krell
Grameen Foundation today announced the release of a set of standards for using its poverty assessment tool, the Progress out of Poverty Index (PPI). The standards are a pre-cursor to a formal certification program the foundation will roll out this fall. PPI users can apply the standards to assess their use of PPI data and identify areas for improvement. Technical assistance providers supporting the use of the PPI can use the standards to target interventions more effectively.
Posted by: Adrian Gonzalez
A few months ago we presented a MIX Research Agenda to explore relationships between social and financial performance. Now we are ready to discuss the main results from this research, based on the social performance data collected for 2008. When reviewing the findings, the reader should keep in mind that they are based on regression analysis that controls for other factors known to impact financial performance (such as age, loan size and lending methodology) in order to isolate the specific set of relationships being investigated.
The research investigates whether social and financial performance interact to lead to important trade-offs or synergies in terms of MFIs' achievement of their double bottom line. For those who like to visualize data, Figure 1 summarizes the expected relationships between financial performance (FP, down the first column) and social performance (SP, across the top row) goals, with green indicating synergies, and red indicating trade-offs, as discussed in the original posting laying out the research agenda.
Figure 1: SP and FP Expected linkages
+: Expected relationship is positive, meaning that an increase in the respective SP is associated with an increase in the respective FP, and a decrease in the respective SP is associated with a decrease in the respective FP. In other words, the variables move in the same direction.
-: Expected relationship is negative, meaning that an increase (decrease) in the respective SP is associated with a decrease (increase) in the respective SP. In other words, the variables move in the opposite direction.
++, --: These are the areas where strong relationships between SP and FP are expected.
0: No relationship (effect) expected at all.
? Expected sign of relationship cannot be determined.
Translated and posted by: Mike Krell
MFIs using CERISE's SPI social audit tool can now provide their core social performance data to MIX without any additional effort. In fact, the SPI questionnaire contains all of MIX’s core indicators. By using the CERISE/SPI method of evaluation—a method recognized and valued by numerous investors, funders, and regulators—MFIs can not only conduct an internal diagnostic and commit themselves to improving social performance, but can also export all of their social data to the MIX format in a single click with the electronic SPI. This new functionality allows microfinance service providers to improve their transparency as well as their visibility at the international level (MIX/SPS).
Posted by: Katherine Oglietti and Mike Krell
Fonkoze’s literacy program in action
Interview with:
Myriam Narcisse, Director, Literacy and Education Program, Fonkoze
Microfinance institutions (MFIs) are often faced with the need to adapt to conditions beyond their control. To ensure both their own survival and the wellbeing of their clients, MFIs must sometimes alter the services they provide in response to the unexpected. Perhaps nowhere was this more the case than in Haiti after the earthquake in January. We caught up with Myriam Narcisse of Fonkoze to talk about how her institution has adapted to the situation there. We also discussed the way Fonkoze has tailored its literacy program to meet the unique needs of its clients.
MIX: In what ways have the needs of your clients changed following the earthquake that devastated Haitians this January? Which of these needs can MFIs feasibly assist their clients in reaching?
Ms. Narcisse: The recent earthquake has changed the needs of our clients in significant ways. Microfinance institutions can assist with some of these needs but not all of them. One obvious way in which clients’ needs have changed results from an increased sense of vulnerability to weather-related dangers. Training clients in disaster risk reduction—how to identify and address a family’s or business’ vulnerability to weather—is one important way that MFIs can help. Another is through catastrophe insurance. Just as Fonkoze introduced micro life insurance when death proved a major de-capitalizing factor for our clients, a new insurance product will help mitigate the consequences of disasters on clients’ paths out of poverty.
Another way in which MFIs can help is by aiding clients in adjusting to the changed market conditions post-quake. They can also work to increase clients’ awareness of the importance of safe construction methods and regular maintenance. We also see right now as a crucial moment to increase youth entrepreneurship and believe it would be fruitful for MFIs to investigate how they can lend a hand in this matter. Finally, MFIs can help meet the need for increased health education.
Some needs, however, MFIs are not well-placed to meet. These include: an appropriate disaster warning system, increased access to schools, decentralized state structures, and increased access to basic services such as potable water, sanitation, and health.
Posted by: Katherine Oglietti and Mike Krell
An ID-Ghana client and her wares
We closely monitor training attendance. In March 2010, 3,249 people received training from ID-Ghana, out of a total of 3,991 active borrowers. And while we have not yet performed an impact assessment of this new training regime, anecdotal evidence suggests that these trainings are having a positive outcome on our partners. We feel that these trainings have equipped partners with much-needed skills and knowledge regarding the effective management of loans, among other things, and that this is reflected in greatly increased loan repayment rates.
Continue reading "Non-Financial Services: The Experience of Initiative Development Ghana" »
