Social Performance Indicators Blog

A Holistic Approach to Gender Equality: Financial and Nonfinancial Services at SABR, Uzbekistan

Posted by: Katherine Oglietti

SABR clients engaged in a training session

Interview with:
Madina Rakhimova, Executive Director and Saodat Akhmedova, Deputy Director, Socio Economic Development Centre (SABR), Uzbekistan

Socio-Economic Development Centre (SABR), based in Samarkand City, Uzbekistan, is an NGO founded in 1996 to support women survivors of domestic violence and their children. SABR seeks to “work with and for women and children in difficult socio-economic situations, providing support, encouragement, and the opportunity for an independent life in a safe environment.” SABR added a microfinance component to its operations in 2001, and officially became a microfinance institution (MFI) in 2006. The MFI aims to improve the socio-economic conditions of the most vulnerable layers of the population by strengthening their abilities to lead independent lives in a secure environment.

MIX: What led to the decision to include a microfinance component into your programming?

SABR: The results of socio-economic surveys in rural areas of Uzbekistan proved that the roots of gender inequality and violence against women are not found only in the gender stereotypes and traditions prevalent in a given society, but also in women’s economic dependence on their families or husbands. To address this problem, the priority of our programming became involving women from rural areas in entrepreneurial activities. The most appropriate means of supporting the startup of individual businesses is through microlending. At the time in 2001, microlending was the new and developing mechanism to support the low income layers of the population in Uzbekistan.

Group Lending and Women’s Empowerment

Posted by: Katherine Oglietti

The solidarity group and village bank loan methodologies are common solutions that microfinance institutions utilize in order to reach clients who do not have the capacity to take out an individual loan. They arguably create social cohesion and build a community support network among the borrowers.

The data from MIX Social Performance Reports shows that the majority of group loans are consistently allocated to women. As we noted in a previous post, 110 of the MFIs surveyed report having women in their target market. Women make up 65% of all clients in those MFIs. When we divide loan methodology according to gender within those MFIs that target women, we observe that 74% of clients served by group-lending are women, while 53% of clients served by individual loan methodologies are women. 

Why do MFIs prefer group lending for women? Here are some common explanations.

1) Alternative for poor clients: Globally, women have lower incomes than men, and therefore are not determined creditworthy for larger, individual loans.

2) Social Collateral: Women may not have the collateral necessary for an individual loan, and the group loan creates social pressure to ensure repayment.

3) Empowerment: Women may benefit from the social cohesion created through group meetings. Solidarity groups are therefore generally considered to contribute to women’s empowerment.

4) Safety nets: Women have a lower propensity to take risks, and taking an individual loan involves greater risk due to the absence of group support. Also, individual loans are usually larger, which involves greater risk of not being able to repay if the investment is not profitable.

An Integral Approach to Women’s Empowerment: ESAF in India

Posted by: Katherine Oglietti

  

Onam celebration by sangam members of the Trichur Branch, ESAF, India

Interview with: 

Benita Sarah Mathew and Sandhya Suresh, ESAF, India

The Evangelical Social Action Forum (ESAF) is a Christian-based non-profit that takes an integrated approach to economic development, incorporating social, environmental, and public health components into their program. ESAF established its Micro Finance Enterprises Development program in 1995, which covers nine states in India. ESAF focuses its efforts on women, youth, and children.

MIX: ESAF has a greater percentage of female middle managers and loan officers than any other MFI reporting from India. Are your high rates of women staff related to gender-specific hiring policies? Are there ways in which women staff can better support ESAF's mission of targeting female clients? If so, in what ways?

ESAF: ESAF believes in providing equal opportunity to the deserving candidates irrespective of their gender, though preference is given to women candidates especially at the level of loan officers. Women are better positioned to establish rapport and build close relationships with the clients that are not merely ‘financial’ in nature. Female loan officers are able to relate to the social, economic, and emotional needs of the client as they belong to the same socio-economic strata of the society. Daughters of the sangam (village bank) members who possess essential and desirable qualifications for a required post are given the priority to serve. ESAF sangam meetings provide a platform for the women members to not only engage in loan operations, but also to share their concerns regarding their homes and communities. We believe that a female loan officer can facilitate an environment of mutual trust and ownership within the groups.

Similarly, female staff can better envision new initiatives for the welfare and overall empowerment of women clients. Thus it has been found that women staff has certainly played a vital role in successfully targeting the women clients.

Prioritizing Women in Middle Eastern Microfinance: Jordan’s Microfund for Women

Posted by: Taea Calcut

Microfund for Women staff discuss operations in a meeting

Interview with:
Nina Robertson, Marketing and Non-Financial Services Manager, Microfund For Women

Since its inception in 1994, the Microfund for Women (MFW) in Jordan has assisted microentrepreneurs - and in particular, women - to improve and expand their enterprises through a range of financial and non-financial services.  In this interview with MIX, MFW Marketing and Non-Financial Services Manager Nina Robertson details how MFW prioritizes the hiring and skills development of female staff and provides trainings to bolster the business acumen of female clients, all while operating in a country where women’s participation in the labor force remains among the lowest in the Middle East and North Africa (MENA) region.

MIX: MFW’s Board and staff feature more women on average than any of the other 13 MENA MFIs reporting social performance data to MIX. For example, 56% of your Board is composed of women while the average for MENA is 26%. Likewise, 73% of your staff is female, with the majority of both management and loan officer positions filled by women, while the average for the region is 47%. What are some factors that have contributed to women being so widely represented among MFW leadership and personnel?

Ms. Robertson: MFW does not have a quota for female staff; however, it is our intention to employ more women than men for a number of reasons. First, and perhaps most importantly, our mission is to empower women economically and socially. Therefore, we strive to achieve our mission by not only targeting female clients but also by ensuring that a majority of women are represented across all levels of our staff. Second, in the cultural climate in which we are operating, it is preferable that our female clients are served by female staff. Finally, hiring women enables us to gauge the real needs of the women we serve, build strong working relationships with them, and develop carefully targeted, gender-sensitive products and services.

Non-Financial Services in Microfinance: Necessary for Women’s Empowerment?

Posted by: Taea Calcut

In a previous post, “Defining MFIs’ Gender Mandate,” we noted that 77 MFIs from a sample of 134 MFIs submitting social performance data to MIX reported that “women’s empowerment” ranked among their top objectives. This begs the question – what are some concrete steps MFIs might take in order to empower women?

The MIX Social Performance Report identifies non-financial “empowerment services” as a way in which MFIs can meet their women’s empowerment objective. Empowerment services include:

• business training to enhance women's market opportunities
• women's leadership training
• training on rights and responsibilities as leaders in participative models
• women's rights education or gender issues training for men and women
• counseling and/or legal services for women victims of violence

An “other” category is also available for MFIs that provide a different service than the options listed.

Graph 1: Women’s Empowerment Services by Type from a Sample of 59 MFIs

 

Our recent analysis of MIX Social Performance reports indicates that 59 (77%) of the 77 MFIs claiming to have a women’s empowerment objective offer a total of 163 different non-financial services.  As shown in Graph 1, the most common service is business training (provided by 45 MFIs), followed by leadership training (provided by 35). Counseling and/or legal services for women victims of violence is the least common empowerment service, offered by only 13 MFIs. 19 MFIs also report offering a different type of service than those listed within the report. Some of these services include literacy and IT classes as well as workshops on accessing government services.

Defining MFIs’ Gender Mandate

Posted by: Taea Calcut

In the past year, over 200 MFIs around the world have submitted social performance reports to MIX. Among the questions asked in the report are those related to institutional policies and programs that aim to empower both female clients and personnel. How, for instance, do MFIs identify constraints women face in their communities and tailor products and services to women's needs? Do MFIs provide non-financial services that complement and enhance the benefits of financial services offered to women?  How do MFIs challenge gender inequality within their own workplaces, ensuring the skills development and promotion of talented female staff?

Today's post marks the first in a series that will examine some of the issues raised in our analysis of these key gender indicators. We start with assessing an MFI’s social mission. How have MFIs explicitly declared their commitment to serving women and does that explicit commitment affect an MFI’s degree of outreach to female clients?

If social performance is about translating an MFI’s mission into practice, then having a clear mission statement is vital. MIX’s social performance report assesses an MFI’s social mission related to outreach to women in three ways. First, it examines if an MFI mentions women in its mission statement. Second, it asks whether an MFI's target market includes women. Finally, it examines whether an MFI lists women's empowerment among its primary development objectives.

Graph 1: Gender Focus among a Sample of 134 Reporting MFIs

As can be seen in Graph 1, MIX social performance report data reveals that 110 (82%) of 134 MFIs sampled claim to target women clients. 77 MFIs (57%) include women’s empowerment among their development objectives. However, significantly fewer MFIs -- 27 of 134 (20%) -- include the word “women” in their mission statement.

From Access to Empowerment: Gender Performance in Microfinance

Posted by: Janiece Greene, Director, Women’s Market, Women's World Banking and Rebecca Ruf, Associate, Capital Markets Group, Women's World Banking

A Women's World Banking client at her shop

Microfinance is best known around the world as a powerful mechanism for low-income women entrepreneurs to lift themselves and their families out of poverty. When women earn, everyone benefits—women focus on improving the lives of their children and families; women repay their loans; women tend to be more loyal customers and to take on greater financial responsibilities of the household. As a result of these dynamics, a majority of MFIs have women as their primary customer base and use “outreach to women” (i.e., percentage of women borrowers) as a proxy for the level of poverty alleviation. However, this indicator only tells part of the story. How well are these women being served? Is simply providing women with access to financial products and services enough to help microfinance organizations meet their double bottom line objectives?

Microfinance for Women's Empowerment

Posted by: Katherine Oglietti

Female bank leaders distribute loans to clients in the Phillipines.

“Gender inequality is the fundamental root cause of most of the remaining hunger and poverty in the world.” That was among the more poignant points made last week during a discussion on gender and microfinance at Microfinance Monday (#MifiMon), a bimonthly Twitter forum. Why do many microfinance programs focus on women? Is this focus justified? How does gender mainstreaming  contribute to poverty alleviation?

The Microfinance Monday participants’ consensus regarding the need for a gender-based approach in microfinance reflects the common sentiment in the industry. UNIFEM states that women are disproportionately affected by poverty, accounting for 70% of the world’s poor. The corollary is that if an MFI seeks to alleviate poverty or provide services targeted to the poor, it should include a gender focus in order to reach those goals. According to the World Bank, women tend to reinvest in the household at rates of 90% of their earned income, so giving women access to savings and credit can improve family health, nutrition, and education, thereby contributing to other aspects of development. (Men, in contrast, reinvest an average of 30-40% of earned income into their families). Women also have higher on-time loan repayment rates, so many MFIs view them as more creditworthy clients.