Responsible Finance through Local Leadership and Learning in Rwanda:
A Market Systems Approach to Scaling Impact
The MasterCard Foundation works with visionary organizations to provide greater access to education, skills training and financial services for people living in poverty, primarily in Africa. As one of the largest private foundations its work is guided by its mission to advance learning and promote financial inclusion to create an inclusive and equitable world. Based in Toronto, Canada, its independence was established by Mastercard when the Foundation was created in 2006. For more information and to sign up for the Foundation’s newsletter, please visit www.mastercardfdn.org. Follow the Foundation at @MastercardFdn on Twitter.
AMIR is the only umbrella body for microfinance institutions in Rwanda that seeks to build a flourishing microfinance sector in Rwanda through different areas of Advocacy and Information, Research and Development, Responsible Finance, Performance Monitoring and Capacity Building. Currently, AMIR has 318 active members, serving poor and middle class families throughout the country. For more information, please visit:
or follow us on Twitter @AMIR_Rwanda.
Responsible Finance through Local Leadership and Learning in Rwanda
Over the years, consumer protection – the idea of providing fair and transparent services to clients– has gained momentum as a core function that should be entrenched in the provision of financial services, especially when targeting the poor. However, while advancements have been made in forming industry consensus on consumer protection principles, challenges remain in ensuring the sound application of these principles to promote responsible financial markets. SEEP believes that microfinance associations can play a pivotal role in supporting the sustainable growth of a responsible microfinance industry, and a positive reputation for the sector, through promoting the adoption and effective implementation of consumer protection principles.
The SEEP Network in collaboration with the Association of Microfinance Institutions of Rwanda (AMIR) and the MasterCard Foundation, will lead the Responsible Finance through Local Leadership and Learning Program in Rwanda. This four-year program (2016-2020), will build on achievements of the first phase of the program, the Responsible Finance Through Local Leadership in Sub-Saharan Africa (link to the archived page) Program, which also sought to promote consumer protection and market transparency in seven microfinance markets in Sub-Saharan Africa.
What is the goal of the Program?
The goal of the Responsible Finance through Local Leadership and Learning Program is to scale the application of consumer protection principles for at least 2 million low-income financial service customers in Rwanda. Through market facilitation, the program aims to catalyze large scale systemic change around responsible finance by addressing the underlying causes of market weaknesses, i.e. the limited capacity and incentives of local actors to provide the necessary support services, rules, and regulations for greater consumer protection, and limited customer awareness of their rights and means of recourse in case of dissatisfaction. Designed to enable local market actors to perform their functions more effectively, the program will engage a broad constituency of organizations that can influence market conduct and create and reinforce the necessary incentives to sustain the change process beyond the life of the program.
How will the Program achieve its goal?
The Program will employ three learning approaches:
- Promoting an enabling environment through active engagement of all relevant stakeholders. The program will apply a market systems development approach to catalyze market level changes. The strategy recognizes that there is a range of public and private actors that have an influence over market outcomes and have important roles to play. AMIR will receive assistance to engage with member institutions, regulators, and public and private stakeholders to implement strategies in favor of consumer protection.
- Expanding the organizational capacity of AMIR to serve as a sustainable and influential advocate for responsible financial market development. The program will focus on building the capacity of AMIR in strategic business planning that places consumer protection at the center, implementation of M&E frameworks emphasizing responsible finance, design and delivery of demand-driven services, and communications outreach to key market actors.
- Accelerating learning and knowledge exchange associated with scaling consumer protection practices within Rwanda and amongst stakeholders in SSA region. Guided by a focused learning agenda, the program will document experiences and lessons learned, organize learning events, and facilitate peer exchanges for associations, financial service providers and public sector actors, both within and outside of Rwanda.
For more information about this initiative, please contact Bintou Ka-Niang, SEEP Director of Association Services firstname.lastname@example.org
Smart Campaign’s Consumer Protection Principles deal with the following:
- Appropriate product design and delivery
- Prevention of over-indebtedness
- Responsible pricing
- Fair and respectful treatment of clients
- Privacy of client data
- Mechanisms for complaint resolution
State of the Practice: Client Protection in Rwanda’s Microfinance Sector