Social Performance Indicators Blog

Non-Financial Services: The Experience of Initiative Development Ghana

Posted by: Katherine Oglietti and Mike Krell

An ID-Ghana client and her wares

Interview with:
Godknows Kporha, Social Mission Manager, Initiative Development Ghana

In response to the rapidly growing population in Ghana’s capital city, fed by a large influx of migrants from rural villages, Initiative Development Ghana (ID-Ghana) caters its financial and non-financial services to deprived areas in Accra. Its approach is to target the poorest urban neighborhoods to build a more inclusive economy. It offers a combination of not only credit but also savings, insurance, and trainings to its "partners" (i.e., clients) with the contention that microcredit is a relevant but incomplete method to effectively respond to the global problem of poverty.

MIX: In ID-Ghana’s Social Performance Report, you report offering adult education training among other non-financial services. Which learning areas do these training sessions cover? How many of your clients participate in these trainings? Have you conducted any assessment as to whether clients have incorporated the skills they learned into their daily lives?

Mr. Kporha: Our trainings fall under two main headings:  business and social.  In our business trainings, we cover topics such as costing and pricing, customer care, business opportunity identification, record keeping, and credit management. Social topics include personal hygiene, national health insurance, domestic violence, and malaria prevention and management. These trainings have been integrated into the methodology for our new group loan product, Onipa Nua, and are compulsory for partners.

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.

Incorporating Poverty Assessment Data into MFIs' MIS

Posted by: Taea Calcut

The Social Performance Indicators Blog speaks frequently about the need for microfinance institutions (MFIs) to collect information on the populations they serve to determine if their activities are aligned with their social missions. However, data collection is only a first step. Following its collection, data must be properly stored, organized, and analyzed to ensure its use by MFI staff in decision-making processes.

Last week, Grameen Foundation released a working document, Basic PPI MIS System Requirements, to address the question of how MFIs can incorporate poverty assessment data captured by its Progress out of Poverty Index^TM (PPI^TM) into their management information systems (MIS). The document is meant to serve as a guide for MFIs' IT staff and consultants and Grameen Foundation welcomes comments from MFIs on their experiences to further refine it. 

For more information on the working document, please visit Grameen Foundation’s Progress out of Poverty Blog. For discussions on how MFIs have put the PPI^TM to use in their social performance measurement and management activities, please visit our blog posts on PRISMA in Peru, Fonkoze in Haiti, or our poverty measurement archives.

Announcement: PPI™ Initiative in Africa

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The Grameen Foundation made an announcement today that it will begin an initiative with three MFIs in Sub-Saharan Africa to use the PPI™ (Progress out of Poverty Index™) to assess client poverty levels, better target poor clients, and track how they are moving out of poverty. The initiative, the first of its kind in Africa, is being facilitated by the PPI™ Users Collaborative in Africa (PUCA), a new, multi-stakeholder group that unites five charter partners—Oikocredit, Catholic Relief Services, Terrafina Microfinance, Planet Rating and Grameen Foundation—with the national microfinance networks APIM/Mali and  APSFD Senegal. As Sub-Saharan Africa is the poorest region in the world, it is particularly important for MFIs of that region to measure whether and how MFIs are able to contribute to poverty alleviation, improving their strategies accordingly.

More information on this initiative is available on the Progress out of Poverty Blog and the Grameen Foundation webpage.

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PPI Shows Fonkoze that Clients Are Moving Out of Poverty

Posted by Preeti Wali, Communications Associate, Grameen Foundation

A few weeks ago, we introduced the Progress out of Poverty Index™ as a way for microfinance institutions to monitor whether they are helping their clients move out of poverty. We conducted an interview with Grameen Foundation and Prisma Peru, who discussed how they are implementing the PPI™. Here, Preeti Wali describes how they are using the PPI™ in Fonkoze in Haiti and adjusting strategies to better serve the poor.

Haiti is the poorest country in the Western Hemisphere. For Fonkoze, the largest microfinance institution (MFI) in Haiti, the mission was clear: target the poor and ultra-poor, mainly women in rural areas, and provide services to meet their special needs. In 2006, Fonkoze—working with Grameen Foundation--introduced the Progress out of Poverty Index™ (PPI™) assessment tool to measure the poverty level of its clients and to track their progress.

“When Grameen Foundation approached me about forming a partnership, the prospect of developing a PPI for Haiti was one of the most exciting elements,” says Fonkoze Director Anne Hastings.  “We want numbers behind the promises we make to the poor.”

Just two years later, the results are positive: data collected in 2008 showed that Fonkoze was meeting its goal to target the poorest, and that its programs were showing results.  Clients who had been with Fonkoze for at least two years saw movement out of poverty; seven percent moved above the $1 a day poverty line from 2006 to 2008, and nine percent moved above the $2 a day line. This movement occurred despite Haiti’s extreme poverty, which was compounded by the devastation of three hurricanes and a tropical storm that threatened or destroyed the livelihoods of approximately 14,000 Fonkoze clients.  

First We Measure…and Then What? Poverty Assessment Application

Posted by: Jessica Elisberg, Marketing Communications Associate, Microfinance Information eXchange (MIX)

At the SEEP Network Annual Conference earlier this month in Washington, DC, a group of practitioners gathered for a full day to discuss their experiences with using various measurement tools to inform and improve their microfinance programs. This session focused on client assessment, as opposed to impact analysis, and the importance of moving beyond measurement to using data for decision-making with the goal of ultimately improving MFI’s service to clients.

Practitioners identified a number of measurement tools that are being used by development organizations, including the FINCA Client Assessment Tool (FCAT), Progress Out of Poverty Index™ (PPI™), Poverty Assessment Tool (PAT), participatory wealth rankings, food security surveys, and market surveys. These tools are being used to varying degrees to better target programs and to inform product and service development by microfinance organizations, but a number of key questions were posed in the day’s discussions that speak to the broader challenges of effectively integrating data collection and program design to achieve social and poverty outreach objectives.

What Do the Social Performance Reports Tell Us About Poverty Measurement?

Posted by: Micol Pistelli

Of the over 200 MFIs that have completed the social performance report to date, about half report having measured new clients’ poverty levels.  The most common poverty measures used by these MFIs are per capita household income and per capita household expenditures. 22 MFIs report having piloted or used the PPI and 15 provided their results.  Links to their reports can be found below:   

• Adventist Development and Relief Agency International (ADRA) – Peru
• Alternativa Solidaria Chiapas (ALSOL) – Mexico
• Association Microfinance Oued Srou (AMOS) – Morocco
• Alalay Sa Kaunlaran, Inc. (ASKI) – Philippines
• Bhartiya Samruddhi Finance Limited (BASIX) – India
• Community Economic Ventures, Inc. (CEVI) – Philippines
• ESAF Microfinance and Investments (P) Ltd (ESAF) – India
• Fondo de Desarrollo Regional (FONDESURCO) – Peru
• Fondasyon Kole Zepòl (FONKOZE) – Haiti
• Movimiento Manuela Ramos (MANUELA RAMOS) – Peru
• Asociación Fondo Nicaraguense para el Desarrollo Comunitario (PRESTANIC) – Nicaragua
• Asociación Benefica Prisma (PRISMA) – Peru
• Programas para la Mujer - Bolivia (PRO MUJER—BOL) – Bolivia
• Small Enterprise Foundation (South Africa) (SEF) – South Africa
• Sonata Finance Private Ltd (SONATA) – India

So, Who Has Reported From Peru So Far?

Posted by: Micol Pistelli

• To date, 7 Peruvian MFIs have reported their social performance data to MIX: ADRA, FINCA Peru, Fondesurco, MiBanco, Movimiento Manuela Ramos, PRISMA, and Pro Mujer Peru.

• All of the MFIs have a social performance rating. (Click on the "Social Rating" link for each institution.)

• Most of the MFIs have poverty measurement data. ADRA, Fondesurco, Manuela Ramos, and PRISMA have piloted or implemented the PPI, while FINCA has used its own Client Assessment Tool (FCAT).

A PRISMA Peru microfinance client at work

Measuring Poverty in Peru: the Experience of PRISMA with the PPI™

Posted by: Micol Pistelli

 

PPI training of trainers session in Peru

Interview with:

Diego Fernandez Concha, Director, Microfinanzas PRISMA Peru

Jeff Toohig, Deputy Director of PPI Deployment, Grameen Foundation

When Dr. Diego Fernandez Concha founded Microfinanzas PRISMA in 1994, his goal was to fight poverty and chronic malnutrition in his country. Fifteen years later, despite recent economic growth, Peru still faces high levels of poverty. According to a nationally representative income and expenditure survey carried out by Encuesta Nacional de Hogares (ENAHO) in 2007, 39.3% of the population in the country lives below the national poverty line and 13.7% lives below half the national poverty line. For a microfinance institution (MFI) like PRISMA that is deeply committed to serving the poorest segment of the population, tracking clients’ poverty levels is a fundamental step toward ensuring that the institution is fulfilling its mission. But how can an MFI track poverty data in an easy and cost-effective way?

When Grameen Foundation developed its Progress out of Poverty Index™ (PPI™) for Peru in 2007, PRISMA was among the first MFIs trained in its use. In an interview with the Microfinance Information eXchange (MIX), Dr. Fernandez Concha and Jeff Toohig, Deputy Director of PPI Deployment at Grameen Foundation, share their experiences with developing and implementing the PPI.

Getting Started: Poverty Measurement

Posted by: Micol Pistelli

This week, we ask a question that is of great interest to many people in the microfinance industry: How can an MFI measure poverty in a credible and practical way? Many MFIs demonstrate a strong focus on poverty in their mission statement but few are able to give an accurate estimate of the share of their clients who live below certain poverty lines.

Standard methods of measuring poverty have proven impractical and pose several problems related to data collection, analysis, and interpretation. Further, their accuracy is frequently unknown.

However, among the poverty measurement tools available, two are directly derived from international and/or national poverty lines and prove to be both accurate and easy to use: the IRIS Poverty Assessment Tool (PAT) and the Progress out of Poverty Index^TM (PPI).

A Pro Mujer loan officer in Peru administering the PPI to a Pro Mujer microfinance client.

These poverty measurement tools are:

• Simple to administer – each PPI interview lasts only 5-10 minutes, while a PAT can be administered in a 10-20 minute interview

• Cost-effective – materials are free and implementation is low cost

• Accurate – each PAT and PPI is calibrated to that country’s nationally representative household survey

How do poverty measurement tools relate to the MIX Social Performance Report?

The social performance report has four indicators related to poverty assessment and progress out of poverty. A MFI that uses one of the poverty measurement tools above is well positioned to provide information on these four indicators and satisfactorily complete the poverty measurement requirements.

To learn more about one MFI’s experience with administering the PPI, stay tuned for an upcoming interview with Dr. Diego Fernandez Concha of PRISMA and Jeff Toohig of the Grameen Foundation.