integrating spm into mainstream microfinance capacity building
TRANSCRIPT
Integrating SPM into Mainstream Microfinance Capacity Building
Microfinance under fire
•October 2010: Crisis in Andhra Pradesh prompts government to move to protect women who are being exploited by MFIs – resulting in suicides.
•Key question: How can we avoid repeating this in future?
•MFIs should:– Do no harm: put client protection principles into practice– Be guided by social mission: adopt SPM
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Objectives
• SPM is a global approach. Affects all organisational systems.
• Support to MFIs from technical agencies critical in systems development for a balanced performance management.
• Leverage existing training activities to deliver SPM concepts and training
•Result: balanced approach to performance management , scale of delivery of SPM training
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Strategy
• Engagement with training agencies to review/adapt existing training materials in specific technical areas
• Facilitate discussions on the SPM Network to capture emerging practices in each area
• Develop technical guidance notes to capture key issues, emerging good practice and resources available for each technical area
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Technical areas
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Guidance notes series
•Audience: donors, networks, technical service providers, consultants
•Content: key issues, emerging good practice, case examples, further technical resources. Targeted guidance for quick uptake.
• Format: Integrated vs. stand-alone
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Content
From the Staff incentives Guidance Note:
Key questions• What goals and behaviours does the current staff incentive
scheme reward? What is the balance between financial and social goals?
• What are the interrelationships between these goals? Are there any conflicts between financial and social goals? For example, when high productivity levels are rewarded, does that have any negative effects on staff and/or clients?
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Table two: Impact of incentives indicators
Productivity: Loan portfolio, number of clients, number of new loans/period Intended outcome: Growth of loan portfolio, expansion of target client base
Social impact Financial impact
Positive impact
Greater outreach to target clients
Helps MFI reach scale
Negative impact
Risk of client over-indebtedness. Poorly trained groups might have portfolio quality problems. Increased focus on new clients can lead to loss of existing clients. Increasing number of non-target clients
Growing portfolio too fast can result in portfolio quality problems if loans are given without proper client credit-worthiness analysis
Progress to date
• Launched November 2010:– Risk management– Staff incentive – Internal control
•Available January 2011:–Governance– Strategic Planning
• Potential New Areas: – MIS– New Product Development
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Future challenges
•Aim: expand the use of guidance notes -> influence microfinance practice
•Challenge: How to ensure scale and effectiveness?
• Potential strategies:– Wide dissemination of guidance notes within industry
– Collaborate with target audience to incorporate guidance notes into capacity building approaches
– Other??
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Next stepsGet involved!
– give input on the content of the guidance notes– give feedback on how you used them in your work– share your experience integrating SPM into management
systems–collaborate with us to adapt your building materials and/or
incorporate the notes into your capacity building approaches.
Contact Christian LOUPEDA, Director Imp-Act Consortium [email protected]
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Learn more•To learn more about the Imp-Act Consortium visit:
www.imp-act.org
•To engage with other practitioners around SPM, join the SPM network: www.spmnetwork.net
•Get detailed practical guidance on SPM on the SPM resource centre: www.spmresourcecentre.net
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