Posts tagged ‘smart campaign’
Part 4: What is the industry doing to protect borrowers?
by Jacqueline Gunn
One of the biggest challenges in the microfinance industry is oversight and regulation on a macro scale. Whilst in countries like the US there are regulations to protect borrowers, this is often not the case in many of the countries where Kiva has field partners. Kiva can’t choose not to work in countries without credit agency regulations as these are often the places where the need for enabling access to credit for the poor is greatest.
So what is the industry doing to help to borrowers now and in the future?
Continue Reading 15 February 2011 at 12:00 tinkgunn 2 comments
Navigating the Social Performance Jungle
By Charlie Wood, Kiva Fellow in Kyrgyzstan
One of my first projects as a Kiva Fellow has been to work with MCC Mol Bulak Finance as they further develop their program of data gathering to quantify social performance. From my perspective as a lender, I imagined that measuring social performance would be a primary concern in the development of the microfinance industry, but in fact social performance management (SPM) is just emerging in the last several years as a best practice. In many ways this is because the lack of either a standardized methodology or ideology in regards to what constitutes social performance. One of the attractive features of Kiva.org is that Kiva vets microfinance institutions (MFI), seeking out organizations that adhere to multiple bottom lines. While some argue that the simple act of supplying credit to individuals without access gives clients financial freedom and should be given blanket encouragement, numerous examples of profiteering and mismanagement have marred the image of microfinance over the past several years. A ballooning belief that microfinance is the panacea to poverty alleviation has been closely echoed by a ballooning in client over-indebtedness. This is due at least in part to a lack of adequate client protection principles(see SMART Campaign). These problems fuel the argument that unfettered microfinance is merely a tool to spread debt burden to the poor while sucking profits from marginalized groups. So how can one measure and present particular MFI social performance in a transparent way? (more…)
