MICROCAPITAL BRIEF: Good World Solutions Uses Mobile Surveys to Promote Microfinance Client Protection

Good World Solutions (GWS), a US-based nonprofit organization that develops anonymous tools for people to report on how companies treat them, has built a mobile-based interactive voice response survey service to gather information from microfinance borrowers in India to determine whether microfinance institutions (MFIs) are following the client protection principles of the US-based Smart Campaign.  GWS reports achieving nine times greater disclosure on sensitive questions compared with call center surveys or interviews. The tool does not require literacy or smartphone access.

As a microfinance customer’s primary point of contact generally is a loan officer, he or she should have an alternative route to report mistreatment by that loan officer to minimize the risk of further mistreatment or revenge. Examples of such inappropriate actions include improper collection activity or compromised ability to get loans in the future.

The Smart Campaign, which was founded by US-based nonprofit organization Accion and is located at Accion’s Center for Financial Inclusion in the US city of Washington, is an “effort to unite microfinance leaders around a common goal: to keep clients as the driving force of the industry.” It promotes seven client protection principles: “appropriate product design and delivery,” “prevention of over-indebtedness,” “transparency,” “responsible pricing,” “ fair and respectful treatment of clients,” “privacy of client data” and “mechanisms for complaint resolution.” As of May 2015, the Smart Campaign has certified 32 microfinance institutions serving approximately 15 million clients.

Financial information for GWS is not available.

By Makai McClintock, Research Associate

Sources and Additional Resources:

About the Smart Campaign
The Smart Campaign, which was founded by US-based nonprofit organization Accion and is located at Accion’s Center for Financial Inclusion in the US city of Washington, is an “effort to unite microfinance leaders around a common goal: to keep clients as the driving force of the industry.” It promotes seven client protection principles: “appropriate product design and delivery,” “prevention of over-indebtedness,” “transparency,” “responsible pricing,” “ fair and respectful treatment of clients,” “privacy of client data” and “mechanisms for complaint resolution.” As of May 2015, the Smart Campaign has certified 32 microfinance institutions serving approximately 15 million clients.

About United States Agency for International Development (USAID)
The United States Agency for International Development (USAID) is a government agency that provides international economic and humanitarian assistance. It focuses on areas such as economic growth, agriculture, trade, health, democracy, conflict prevention and humanitarian assistance. Under the Development Credit Authority (DCA), it provides credit guarantees that cover up to 50 percent of defaults on wholesale loans made by private financial institutions to institutions that lend on a retail basis to underserved borrowers. USAID had a total of USD 23.2 billion in budgetary resources in 2012.

Huffington Post Article: “Mobile in Microfinance: Not Just Mobile Payments,” http://www.huffingtonpost.com/heather-franzese/mobile-in-microfinance-no_b_7206410.html

Labor Link Description: http://goodworldsolutions.org/services/

MicroCapital Universe Profile, The Smart Campaign

MicroCapital Universe Profile, United States Agency for International Development

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