“Economic strengthening” is all about breaking with the “microenterprise myth” that everyone, ... Read More >]]> This blog post was written by Carine Roenen of Fonkoze and Sabina Rogers and Bridget Dougherty of the Microcredit Summit Campaign who attended the recent Microlinks After Hours Seminar, “Lessons Learned From Sequenced, Integrated Strategies of Economic Strengthening of the Poorest.“ The post originally appeared here on the Microlinks blog. 

“Economic strengthening” is all about breaking with the “microenterprise myth” that everyone, even the ultra poor, can start a business—that all they need is a loan. Building on a deeper understanding of the idiosyncrasies that characterize extreme poverty, organizations have developed promising interventions that incorporate “push” strategies that help build assets for those who cannot make ends meet and “pull” strategies to bring the excluded into the system.

During USAID’s Microlinks After Hours Seminar “Lessons Learned From Sequenced, Integrated Strategies of Economic Strengthening of the Poorest” on March 21, 2012, Aude de Montesquiou (CGAP), Jaya Sarkar (Trickle Up), and Jan Maes (The SEEP Network) presented integrated strategies that aim to meet the needs of the ultra poor so that they can negotiate their way out of poverty.

Understanding ultra-poor populations and developing appropriate interventions

“A household in extreme poverty is in a state of bankruptcy—not capable of covering its minimum expenditures for daily survival—and the sequenced strategies we are discussing today are very similar to remedies used for bankruptcies:  cash injection to pay for most critical needs followed by debt reduction and asset (re)building.” – Jan Maes, The SEEP Network

To overcome the roadblocks of the past, organizations promoting the economic rights of the poorest realize that they need to better understand who their clients are and what their psychological, social and economic characteristics are. De Montesquiou explained that many among the extreme poor lack what is necessary to be successful entrepreneurs, such as confidence, knowledge, assets, and tools. Maes stressed that, even among the extreme poor, we need to recognize that there is a wide range between “destitute” and “struggling to make ends meet.” We need to look at the causes of their poverty and the nature and degree of their vulnerability. By understanding this nuance, we can design appropriate activities, programs, and services that integrate the right components (e.g. asset transfers, handholding, and financial services) with the proper sequencing to address these vulnerabilities.

From pilots to proof-of-concept

Organizations participating in the CGAP Ford Foundation Graduation Program are testing this model of integration and sequencing. De Montesquiou presented qualitative and monitoring results for Fonkoze, their partner MFI in Haiti. The Fonkoze Foundation developed its Chemen Lavi Miyò (CLM), or “Pathway to a Better Life,” program to provide a multipronged livelihood protection and promotion service to carefully target ultra-poor women in rural Haiti. Specifically, CLM provided the women with assets for entrepreneurial use, enterprise training, health services through Partners in Health, housing support, a consumption stipend, and social links with village elites—all facilitated by the close support of a CLM case manager.  This push strategy decreased food insecurity among participants by over 50%. Severe wasting among CLM children decreased from 13% to 4% and Personal Potential Index (PPI) scores show 16% of participants passed the $1/day line. After 18 months, more than 90% of the participants were ready to participate in Fonkoze’s regular microfinance program. Thanks to support from the MasterCard Foundation, Concern Worldwide, the Haitian Timoun Foundation, and Fondation Kanpe, the program has now been scaled up to include more than 2,000 families.

In her presentation, Jaya Sarkar described Trickle Up’s challenge as “struggling to make our initiatives more effective” and adapting a series of interventions in their graduation pilot in India. Since 2009, the graduation model has been Trickle Up’s standard approach in India. Now, they are mainstreaming learning into the rest of the organization by effectively using the push strategy developed through the pilot project to learn about the ultra poor and better designing pull strategies through other programs. When Trickle Up moved from the pilot phase to proof-of-concept, they shifted their focus, putting an emphasis on self-help groups (SHGs). They found, as Sarkar described, impact in unexpected areas. In particular, they found that groups were taking collective action. SHGs in Mali were creating a social safety net for members and creating access to financial services for non-members in their community, thus enlarging the population that directly benefited from the intervention. In India, they found SHGs are taking action on social issues, improving public shared space, and advocating on behalf of others for better service from banks.

Call to action

“What do the ultra poor need?” asked Jan Maes. That is the key question, and to figure this out, integrated strategies will be needed to learn from a variety of sectors such as microfinance, social safety nets, market development, protection and promotion, women rights, and others.  The STEP UP Initiative from The SEEP Network aims to connect these silos of practice, breaking the “stovepipe syndrome,” to enable multidisciplinary learning.

But there many questions about microfinance remain. ... Read More >]]> In 2012, microfinance has a strong global following. The success stories of empowered individuals whose lives are made better by microfinance are many, and microfinance academics and practitioners constantly seek to expand the knowledge and application of microfinance to provide poor and low-income individuals with financial services and training.

But there many questions about microfinance remain. For example, should microfinance be value-driven or profit-driven? Is microfinance an industry? Or is it a movement?

The 2012 Month of Microfinance (MoMF) is a coalition of student-led and student-focused organizations dedicated to exploring these types of questions. By encouraging critical conversations and awareness of microfinance practices, this academic movement aims to achieve three critical objectives:

1)         To provide educational opportunities for students and their communities and prepare students to become the next generation of microfinance practitioners

2)         To raise awareness and funds for domestic and global microfinance

3)         To unite the student microfinance movement in coordinated and shared events

Throughout the month of April, students at participating colleges, universities, and high schools will host and participate in campus events related to microfinance. The MoMF will bridge microfinance in the professional world and microfinance in the academic world through student-led events.

Events will include:

• Hosting professional guest speakers
• Showing documentaries about microfinance
• Fundraising for microfinance institutions
• Hosting microfinance discussion groups
• Writing letters to local community newspapers
• Providing information about microfinance to other students

Each student-hosted event will focus on the definition of microfinance, the groups that benefit from microfinance, and the relationship between client-centered and profit-driven microfinance.

MoMF partner organizations also host virtual events through webinars and blogs, as well as community and educational events. Check out the nationwide event list for complete details.

Take a few minutes to browse the Month of Microfinance website to find out more about this nationwide academic movement happening in April. Learn how you can host awareness and fundraising activities or partner with MoMF here.

_____________

Shaw Humphrey is an associate professor of economics at the University of Mary Washington and the founder the Month of Microfinance.

Financial access for various entities in the rural and agricultural sector is crucial to the mission of sustainable poverty ... Read More >]]> This blog post, which originally appeared on the Microlinks blog, was written by SEEP staff Sonali Chowdhary and Bethany Bengfort after attending the recent Microlinks After Hours Seminar, ”Viewing Value Chain and Household Finance From a Demand Perspective.”

Financial access for various entities in the rural and agricultural sector is crucial to the mission of sustainable poverty reduction, livelihood promotion and overall economic growth. The nature of the rural and agricultural value chains, as well as the elements surrounding it, imparts both unique challenges and opportunities for innovation in this field.  During USAID’s Microlinks After Hours Seminar on February 16, 2012, Geoffrey Chalmers from ACDI/VOCA and Jason Agar from Kadale Consultants Limited discussed these various challenges and innovations, referencing Agar’s report, Rural and Agricultural Finance: Taking Stock of Five Years of Innovations.

What does “innovation” mean in rural finance?

Chalmers and Agar raised some bigger questions like what do innovations truly mean in this field? What do we do when standard business models fall short and how do we bring in new perspectives?

According to Chalmers, recent innovations in the field of rural finance include solutions which address challenges from a demand side while also addressing challenges from a supply side.  While traditional approaches often focuses on service providers and products, new solutions in the field are going beyond the  product and service provider approach and  are looking at household level challenges as well as the overall institutional and enabling frameworks . Chalmers and Agar talked about rural financing needs and challenges across four categories:household finance, non-farm enterprise finance, the enabling environment, and agricultural value chain finance.

Chalmers and Agar emphasized the concomitant nature of each category and the need for an integrated model of finance that addresses the shared constraints within each area. As Chalmers put it, “Often we forget that cash flow involves the entire household, the entire environment- not just the steps on the value chain.” 

Multiple-level challenges in rural finance

Household Finance Challenges 

Chalmers and Agar noted that some of the biggest financial restraints on households are vulnerability to shocks and the need to meet urgent and non-urgent household requirements like education and health.  Poor access to promotional services and lack of financial literacy are additional household level constraints. A lack of basic needs combined with poor cash flows force households to focus on short-term gains rather than maximizing long-term business opportunities.

Non-farm enterprise finance challenges

A major challenge for non-farm enterprise financing includes poor understanding of household borrowing capacity in a non-farm context. “Rural” is often associated with agriculture, and non-agriculture related businesses in rural areas are given far less attention than their urban counterparts.  This leads to poorly designed products for the rural non-farm sector and to conservative lending which relies more on collateral and less on an understanding of household cash-flows.

Chalmers and Agar noted that progress in this field include improvements  in collateral requirements and an increase in the physical presence of financial institutions in rural areas through cellular access, banks on wheels, etc. Both noted that there is still a long way to go in this area.

Enabling environment challenges

Challenges in this area include the high cost of access to rural markets which deters institutions from providing needed services combined with inappropriate legislation and an inadequate regulatory framework. Microfinance institutions (MFIs) that are better positioned to service the rural poor have limited access to capital, inhibiting their ability to take risks in the area of rural lending.

Innovations include smart partnerships and use of technology combined with improvements in MFI strengthening and increased access to capital.

Agricultural value chain finance challenges

Chalmers and Agar observed that many of the problems facing the agricultural value chain were present in the other categories, including poor infrastructure for remote households, seasonality of products, price distortions, skewed perceptions of risk, unequal access, lack of storage capabilities, and the difficulty of analyzing and assessing proper cash flow needs. Many of these factors contribute to market disruptions such as side selling, increased risk, and general failure to access finance in any area.

Solutions require addressing the problems in every category by developing relationships based on mutual incentives. For example, offering integrated support packages that allow both farmer oversight and “hungry season” support reduces side-selling by addressing the household need for year-round cash flow, the business need for reduction of risk and market disruptions, and general improvement of liquidity and trust.

Integrated support packages in recent years have included innovations in disaster response, various kinds of insurance, marketing and outreach efforts, and promotion and encouragement of saving. For example, index based insurance, which is based on measurable factors like rainfall, drought, and snow, is an important risk mitigating tool because itbrings down the cost of monitoring by eliminating issues of moral hazard and information asymmetry.

Chalmers and Agar talked about two key risks in value chain financing: side selling and risks associated with price and markets. Innovations mentioned that address side selling are products like hungry season payments, agriculture commitment savings, measures to increase liquidity and the provision of integrated support packages that reduce the need for urgent selling  at a household level.  Innovations that address risks in price and markets include offering fixed price bands, formal or informal contracts, index insurance and integrated packages.

See additional resources on rural and agricultural finance from The SEEP Network.

The following was originally posted on CGAP Microfinance Blog. 

The SEEP Network recently released a new study, “Codes of Conduct and the Role of Microfinance Associations in Client Protection” that ... Read More >]]>

Cara Forster (center) presented on SEEP's new "Codes of Conduct" publication at the Finca offices for the Women of Microfinance (WAM) DC panel on January 25.

The following was originally posted on CGAP Microfinance Blog. 

The SEEP Network recently released a new study, “Codes of Conduct and the Role of Microfinance Associations in Client Protection” that explores the potential for codes of conduct to improve industry practices in client protection through three case studies: the Pakistan Microfinance Network, the Microfinance Institutions Network in India, and ProDesarrollo in Mexico.

The publication uses these case studies to demonstrate how industry actors are addressing some of the core consumer protection issues—transparency and disclosure, dispute resolution and complaints channels, responsible lending, and fair treatment—as well as some country-specific issues—such as a “staff bureau” in Pakistan that tracks past and current employees of PMN members who have committed fraud at work to warn others against hiring them.

But what does this movement towards codes of conduct amongst microfinance associations mean from the policy perspective? Policymakers (and the rest of us) cannot count on the microfinance industry to handle client protection all on its own, not least of which because it is only one niche amongst the broader range of financial services used at the base of the pyramid. So what then is the right balance between regulation and self-regulation in consumer protection?

To answer this question it is useful to analyze the comparative advantage of regulators and retail providers on an issue-by-issue basis. Some consumer protection goals and principles are more amenable to self-regulation and others less so. And there are a few areas where both providers and regulators can collaborate for better outcomes. Here are a few examples of what I mean:

Less amenable to self-regulation:
Pricing transparency and disclosure. All three cases in the SEEP study described how difficult it can be for associations to achieve consensus amongst their members on pricing and disclosure rules. In some cases it is even profitable in the short-term for a provider to obfuscate terms and collect high interest, fees, or penalties even if the loans provided are not sustainable in the long-run. Even if consensus is achieved by an industry association, it will likely not cover a large segment of the market, leaving some actors capable of continuing to gain market share and competitive advantage through price obfuscation.  For example, in Mexico, the ProDesarrollo network includes 85 financial institutions, including many leading MFIs, but does not cover most of the hundreds of the consumer credit institutions common in the Mexican market.

Regulatory rules on pricing transparency can achieve broader market coverage than most association-driven efforts. For example, in 2001 the National Bank of Cambodia prohibited the use of flat interest rate calculations amongst MFIs, which recent analysis by MFTransparency shows helped increase pricing transparency and reduce borrowing costs across the entire sector, something that may be beyond the reach of even the most powerful national MFI Association.

Finally, since transparency and disclosure are fairly rules-based issues  where unambiguous guidance and definitions can be established for all to follow, they lend themselves well to a legal and regulatory approach to develop market standards that can be applied broadly and effectively enforced.

Amenable to self-regulation:
Collections practices. Experience suggests that while regulators have a role in pointing out practices that are unacceptable, providers are better at developing operational solutions to the problems. Collection practices probably fall into this category. While regulators might want and need to set some basic rules (for example, around abusive behavior, property seizures, or handling of collateral), it is unlikely that they can determine the best way to implement those rules. Regulators’ impact on the market is likely to be limited without providers taking the lead in translating ideas into specific rules regarding collections staff and agents, training and internal controls to ensure compliance. Furthermore, given the reputational risk and politicians’ sensitivity to any whiff of abusive behavior, the industry has a strong self-interest to fix this particular problem.

May depend on the market context:
Responsible lending. Private sector efforts to improve lending practices through a code of conduct can include measures concerning affordability assessments, appropriateness of product design, or flexible payment terms. However, these topics are fairly subjective and hard to properly define and monitor. This means that the success of such measures will likely depend in great part on the level of influence and market share coverage of a particular industry association. Similarly, the theory that increased competition in a market will punish bad actors and reward responsible lenders with new customers does not always hold true in the short-term, and so there may be a need for policymakers to intervene and stem a growing credit bubble or widespread improper practices before they impact the entire market.

Opportunities for public/private collaboration:
Recourse and dispute resolution. Effective recourse systems generally involve both internal and external complaints and dispute resolution mechanisms, which ideally are coordinated. Many complaints made by consumers are actually questions or inquiries for further information, and can be handled quickly and efficiently at the provider level.  In general it is important that complaints be addressed and resolved as close to the customer and transaction as possible and that they be filtered from minor to more severe so that the government body responsible for recourse is not overwhelmed by handling hundreds or thousands of lower-level complaints, and can focus its time on the more significant or egregious cases. Sharing of consumer complaints data between public and private complaints mechanisms is also an important component of a public/private approach to recourse, and can help both sides monitor and detect client protection “hot-spots” as they arise.

Financial capability and customer education. Increased government interest in financial capability and consumer education programs is occurring simultaneously with interesting findings that point to the benefits of using actual consumer experiences to design more salient and “sticky” financial education programs. There is an opportunity here for providers and governments to partner and develop joint financial education initiatives that are based on products consumers use, but achieve national scale in their outreach (just such a campaign was recently launched in Colombia.)

What do you think? Are there other client protection issues that you feel are particularly “private,” “public,” or “both?” Are there other success stories you have seen of coordinated regulation/self-regulation efforts to improve financial consumer protection? How can we make effective business cases for these client protection measures that help industry associations convince their members to adopt these codes of conduct?

_____

Rafe Mazer is a financial sector analyst for CGAP’s Government & Policy team.

•         What capacity do you need in your organization to engage the private sector effectively?

•         What risks do you see in private ... Read More >]]> At the 2011 SEEP Annual Conference’s “Market System Facilitators Engaging with Corporates” workshop, the three speakers—Alison Griffith of Practical Action, Stephanie Daniels of Sustainable Food Labs, and myself (CARE)—asked the audience these three questions:

•         What capacity do you need in your organization to engage the private sector effectively?

•         What risks do you see in private sector engagement and how can they be managed?

UK supermarket ASDA stocks flowers from small-scale farmers in Kenya. | Sustainable Food Laboratory

It is interesting to put the workshop into perspective with the plenary session that came before it, “Leveraging Private-Sector Incentives and Strategies for Development Outcomes.” While the plenary session gave us a very good overview of the potential of the private sector as a development actor in terms of outreach and income (mainly from the perspective of international agencies and donors), the workshop described the point of view of NGOs, pointing at the necessary elements to make things work in practice.

It became clear in the workshop’s group discussions that while leveraging private sector resources and motivations can be a key element of success for market engagement initiatives, this approach is not a silver bullet. Other important elements need to be taken into account, as highlighted by the discussion:

We need to take the entire system into account: Engaging with corporations does not necessarily work unless the whole market system is analysed and engaged.

Engaging with corporations, especially in high-value export markets, presents risks for small producers, particularly in terms of food security. Mitigation strategies–for instance, promoting a mix of food crops and cash crops among smallholders–are necessary.

Facilitators should: 

-      Engineer relationships, rather than being part of the system

-      Build capacities in order to meet opportunities

-      Support smallholders to assess risks themselves.

The next generation of market facilitators will need blended skills. They must be able to speak both NGOs’ and corporations’ languages. In some cases this implies a cultural change as well.

Timelines conflict: project cycles happen in the medium term, while commercial cycles occur in the short term.

The reputational risk for NGOs to engage with some “not so responsible” corporations also remained between the lines of the discussion, and needs to be clearly addressed through a structured analysis.

The role of the private sector in market systems became a sort of sub-track within market development during the conference, and the question of how to make these partnerships work effectively should constitute a key learning theme for the development community.

Presentations from this workshop are available in PDF form here, under Enterprise and Market Development Systems Track.

The last question we want to look at (and the one raised in our prior post) is how financial inclusion data can be used in practice. The first step here is ... Read More >]]> Pour accéder la traduction française, veuillez défiler vers le bas.

What do we do with this data? How do you get the right data to the right people?

The last question we want to look at (and the one raised in our prior post) is how financial inclusion data can be used in practice. The first step here is to look at the different potential audiences for this data and how they may use the information. Do these align with goals and audiences of networks?

A first audience is policy-makers. So far, much activity on ‘financial inclusion’ has taken place in the high-level policy sphere. Regulators and policy-makers use data on financial inclusion to develop policy and to monitor progress. For instance, the superintendency in Peru uses benchmarks on financial inclusion to measure progress in reaching under-served areas. The Central Bank of Nigeria (among the markets with the largest access gaps) has set ambitious goals for the reach and scope of the sector. (Expect to see more research on this via MIX soon!)

The data needed to measure this progress is precisely the type of data that networks are well-placed to provide though – in the case of Peru, for instance, some large MFIs are not regulated, but are members of local and international networks. For networks that have policy advocacy as part of their focus, building up financial inclusion data can support that agenda.

MFIs can also use landscape data. If an MFI wants to expand into new markets or offer new products, a comprehensive landscape view can help to support business planning. What types of competition might they encounter? Which populations are most under-served? This is where a sub-national view on the data can be even more valuable. Data at a country-level may be of some use, but data at a branch or district-level will be even more powerful for MFI practitioners.

Networks themselves are another potential beneficiary from landscape data. How many networks produce state-of-the-sector reviews or annual updates for members? Landscape data can give the big picture on the sector for members, and place their activities in context, whether the network itself has a broad or a narrow focus for membership. Information as in these sector maps from AEMFI or APIM – BF or MITAF or the DRS in Senegal – provides a baseline. Networks can also use landscape data to highlight gaps or opportunities for donors and investors.

Our knowledge and standards on financial inclusion are still developing. But if we want to build a realistic understanding of the world – and not just where the streetlight shines – networks can play a key role in data collection, data sharing and analysis.

*             *             *             *             *

Que faisons-nous avec ces données? Comment obtenez-vous les bonnes données aux bonnes personnes?

La dernière question que nous voulons regarder (et celle soulevée dans notre blog précédent) est de savoir comment les données de l’inclusion financière peut être utilisée dans la pratique. La première étape est ici d’examiner les différents publics potentiels de ces données et comment ils peuvent utiliser l’information. Ces s’alignent sur les objectifs et les publics de réseaux?

Une première audience est les décideurs politiques. Jusqu’à présent, beaucoup d’activité sur «l’inclusion financière» a eu lieu dans la sphère politique de haut niveau. Les régulateurs et les décideurs politiques utilisent des données sur l’inclusion financière pour élaborer des politiques et à surveiller les progrès. Par exemple, la surintendance au Pérou utilise des repères sur l’inclusion financière pour mesurer les progrès pour atteindre les régions mal desservies. La Banque centrale du Nigeria (parmi les marchés les plus grands écarts d’accès) a fixé des objectifs ambitieux pour la portée et l’étendue du secteur. (Attendez-vous à voir davantage de recherches sur ce mélange via MIX bientôt!)

Les données nécessaires pour mesurer ces progrès est précisément le type de données que les réseaux sont bien placés pour fournir – dans le cas du Pérou, par exemple, certaines grandes IMF ne sont pas réglementés, mais sont membres de réseaux locaux et internationaux. Pour les réseaux qui ont plaidoyer politique dans le cadre de leur orientation, la constitution de données de l’inclusion financière peut soutenir que l’ordre du jour.

Les IMF peuvent également utiliser les données du paysage. Si une IMF souhaite développer de nouveaux marchés ou d’offrir de nouveaux produits, une vue complète du paysage peut contribuer à soutenir la planification d’entreprise. Quels sont les types de la concurrence ils pourraient rencontrer? Quelles sont les populations les plus mal desservies? C’est là une vue sous-national sur les données peuvent être encore plus précieux. Les données à un niveau national peut être de quelque utilité, mais les données dans une succursale ou au niveau du district sera encore plus puissant pour les praticiens de l’IMF.

Réseaux eux-mêmes sont un autre bénéficiaire potentiel à partir des données du paysage. Combien de réseaux produisent les revues de l’état du secteur ou de mises à jour annuelles des membres? Paysage de données peut donner une vue d’ensemble sur le secteur pour les membres, et le lieu de leurs activités dans le contexte, si le réseau lui-même a une large ou une vision étroite de l’adhésion. L’information comme dans ces cartes à partir du secteur de AEMFI ou APIM – BF ou MITAF ou le DRS au Sénégal – fournissent une base. Les réseaux peuvent également utiliser les données pour mettre en évidence les lacunes du paysage ou des opportunités pour les donateurs et les investisseurs.

Nos connaissances et des normes sur l’inclusion financière sont encore en développement. Mais si nous voulons construire une compréhension réaliste du monde – et pas seulement là où brille le lampadaire – les réseaux peuvent jouer un rôle clé dans la collecte de données, le partage de données et d’analyse.

When MIX took on the project to create the map of financial inclusion in Africa, the first question we asked ourselves was, “Where are we going to get this information?”  We know that data is not always easy to come by, especially within the microfinance world. ... Read More >]]> Pour accéder la traduction française, veuillez défiler vers le bas.

When MIX took on the project to create the map of financial inclusion in Africa, the first question we asked ourselves was, “Where are we going to get this information?”  We know that data is not always easy to come by, especially within the microfinance world.  There are myriad agencies across sub-Saharan Africa collecting various data points from all kinds of financial service providers, but little consistency of the data or frequency of collection.

Some financial service providers are regulated, and thus required to report to Central Banks – but which data points, and how frequently they are required to report lacks consistency even within a given market, let alone across the continent.  Many others are not regulated, and who they report to can be complicated and multi-fold.  Often credit unions have their own apex body to report to, not to mention the global credit union association, WOCCU.  Mobile banking tends to have its own very specific legislation, as well as the international mobile money focused organization GSMA.  But what of the NGOs and the non-bank financial intermediaries (NBFIs)?  Who do they report to? Who is collecting data from them to help track the outreach and performance of these institutions which are providing access to financial services to the poor?

This is one place where national level networks play a key role.  There are many institutions that regulators don’t see; networks are our unique window onto this world – they help us look outside the streetlight.  But what is the role of networks as data providers? How do networks chose from whom they collect data?  Do they target only those institutions that are not already reporting elsewhere?  If so, there really is no single repository for information on inclusive access to financial services across any given market.  Yet, trying to collect data from all institutions providing financial services to the poor on an annual or potentially quarterly basis, would require strong capacity.  So where to draw the line?  How does your organization select which institutions to target for data collection?  What role does data collection play for your organization?

A question that may be even more important is, “What’s the point?”.  Collecting data requires substantial time and effort, so why bother?  Who uses it?  Earlier this year MIX conducted a survey across sub-Saharan Africa on the reporting burdens of MFIs, and discovered that the total burden of reporting to central banks, networks, investors, MIX and others can be extremely cumbersome, sometimes necessitating a full time employee to focus solely on preparing reports to external stakeholders. This can be both time consuming and expensive.  So again, what’s the point?

They say knowledge is power.  However, this is only the case if one actually utilizes this knowledge in a productive way.  So, who currently is using this data that is so painstakingly collected by hundreds of organizations?  Who should be using this data?  In what format do your organizations collect data, and how is the information that you have collected disseminated back to the financial service providers?  Are they receiving any benefit from reporting, or is it only a drain on their time and resources?  Is this information also getting into the hands of decision-makers on a higher level, to play a role in the development of appropriate legislation?

We know that it can be difficult to obtain accurate and timely information from MFIs.  We also know that it is essential that we do this.  But how can we ensure that we are maximizing our use of the information that we have?  How does your organization use the data that you collect?  How can organizations within the industry work together to get the right information into the right hands in a useful way?

*              *              *              *              *

Lorsque MIX a commencé le projet pour créer la carte de l’inclusion financière en Afrique, la première question nous nous sommes demandé était: «Où allons-nous obtenir cette information?” Nous savons que les données ne sont pas toujours faciles à trouver, surtout dans le monde de la microfinance. Il existe une myriade d’agences à travers Afrique sub-saharienne recueillant différents points de données de toutes sortes de prestataires de services financiers, mais peu de cohérence des données ou fréquence de la collecte.

Certains fournisseurs de services financiers sont réglementés, et donc requis de faire rapport aux banques centrales – mais quels points de données, et à quelle fréquence ils sont requis de faire rapport manque de cohérence, même au sein d’un marché donné, et encore moins à travers le continent. Beaucoup d’autres ne sont pas réglementés, et qui font rapport à qui peut être compliqué. Souvent les coopératives de crédit ont leurs propres organe suprême de lui faire rapport, sans parler de la Global Credit Union Association, le WOCCU. Les services bancaires mobiles tendent à avoir leur propre législation très spécifique, ainsi que l’organisation GSMA, axée sur l’argent mobile international. Mais ce que les ONG et les intermédiaires financiers non bancaires (NBFI)? Qui ont-ils des comptes? Qui collecte les données de leur part pour aider à suivre la diffusion et la performance de ces institutions qui sont l’accès aux services financiers aux pauvres?

C’est un endroit où les réseaux au niveau national jouent un rôle clé. Il ya beaucoup d’institutions que les régulateurs ne vois pas; réseaux sont notre unique fenêtre sur ce monde – ils nous aident à regarder à l’extérieur du lampadaire. Mais quel est le rôle des réseaux en tant que fournisseurs de données? Comment les réseaux choisissent de qui de recueillir des données? Est-ce qu’ils ne ciblent que les établissements qui ne figurent pas déjà des rapports d’ailleurs? Si oui, il n’ya vraiment pas de référentiel unique pour l’information sur l’accès aux services financiers inclusifs dans un marché donné. Pourtant, en essayant de recueillir des données auprès de toutes les institutions fournissant des services financiers aux pauvres sur une base annuelle ou potentiellement trimestriels, exigerait une forte capacité. Alors, où tracer la ligne? Comment votre organisation sélectionner les établissements à cibler pour la collecte des données? Quel rôle joue la collecte des données de votre organisation?

Une question qui peut être encore plus importante est: Quel est le point? La collecte de données nécessite du temps et des efforts substantiels, alors pourquoi s’embêter? Qui l’utilise? Plus tôt cette année MIX a mené une enquête à travers l’Afrique sub-saharienne sur les charges des rapports des IMF, et a découvert que le fardeau total de rapports aux banques centrales, des réseaux, des investisseurs, MIX et d’autres peuvent être extrêmement lourdes, nécessitant parfois un employé à temps plein pour concentrer uniquement sur la préparation des rapports aux parties prenantes externes. Cela peut être à la fois long et coûteuse. Encore une fois, quel est le point?

Ils disent que la connaissance est pouvoir. Cependant, ce n’est le cas que si l’on utilise réellement ces connaissances de manière productive. Alors, qui utilise actuellement ces données qui est si minutieusement recueillies par des centaines d’organisations? Qui devrait être d’utiliser ces données? Dans quel format vos organisations recueillent des données, et comment sont les informations que vous avez recueillies diffusées aux fournisseurs de services financiers? Ont-ils reçu aucun bénéfice de rapports, ou est-ce seulement une ponction sur leur temps et de ressources? Est-ce que cette information est également tombé entre les mains des décideurs à un niveau supérieur, à jouer un rôle dans le développement d’une législation appropriée?

Nous savons qu’il peut être difficile d’obtenir des informations précises et en temps opportun auprès des MFI. Nous savons également qu’il est essentiel que nous le fassions. Mais comment pouvons-nous nous assurer que nous maximisons notre utilisation des informations que nous avons? Comment votre organisation utilise-t-elle les données que vous collectez? Comment peuvent les organisations au sein de l’industrie travaillent ensemble pour obtenir la bonne information dans les bonnes mains de manière utile?