A while back I had some posts on whether or not I thought microfinance worked (Part 1, Part 2)
Part of my job here at FAPE, is to try and measure how they are doing. The tool which Kiva wants me to use is a 80-question survey that has been designed and refined to measure the social performance of a particular microfinance institution (MFI). This is an example of a question
Does the MFI provide small loans (≤ 30% GDP p.c.) that can facilitate access for the poor?
Definition: Small loans = The amount, on an annual basis, is below 30% of annual GDP per capita. Example: In a country where GDP per capita is USD 1000, small loan = amounts below USD 300 disbursed for12 months. If the duration is 6 months, the amount disbursed must be inferior to USD 150.
0 = small loans < 30% of the total number of outstanding loans
1 = small loans < 50% of the total number of outstanding loans
2= small loans ≥ 50% of the total number of outstanding loans
The survey is called CERISE. CERISE’s goal is to measure an MFI’s performance in distinct categories as a method of comparing one MFI to another, and as a method of letting the MFI know what areas the MFI is potentially weak in. This chart–derived from FAPE’s data–an example of how to visually represent what we are trying to say. As you can see, FAPE does a pretty good job with economic benefits to clients, empowerment, and pro-poor methodology; however, it is clear that FAPE is weak in several areas, most glaring of which is client participation.
But the results must be take with a grain (or two) of salt. Not every MFI has the same goals. FAPE, for example, has empowerment of women in it’s core beliefs, but client participation is not a part of their principal values. Also, as I said in earlier posts, it’s not easy to measure empowerment, but you can sure try.
