The first day of European Microfinance Week 2023 began this morning with meetings of several of the European Microfinance Platform’s (e-MFP’s) Action Groups. At the Investors Action Group session, Cécile Lapenu of CERISE discussed the recent increase in demand for accountability regarding claims of positive client impact. What really makes an investor an impact investor? How can we measure impact in a way that is convincing and also efficient?
The recently published 60 Decibels Microfinance Index 2023 addresses some of these questions. The study, which is based on a survey of 32,000 microfinance clients in 32 countries, indicates that access to financial and non-financial services other than credit leads to deeper impact. Regarding credit services, group lending is associated with greater impact than individual lending. The length of the client’s relationship with her financial services provider (FSP) also is correlated with better outcomes.
The US-based NGO Opportunity International is one of the partners of the 60 Decibels report. Opportunity has been working to measure impact for about 10 years – originally under the assumption that FSPs would have more confidence in data they collected in-house. However, it turned out that FSPs often found that their own data had quality issues that undermined their confidence in acting on it to adjust their practices. Since getting access to the 60 Decibels data, conversations between FSP CEOs and Opportunity staff are much improved. It has been particularly helpful to compare FSPs’ data to benchmarks – either to one of the six country-specific benchmarks in the 60 Decibels report or to the top 20 percent of the report’s global dataset.
Stay tuned for more on today’s Investors Action Group meeting!
This report is part of a sponsored series on European Microfinance Week 2023, which began today in Luxembourg and is also accessible online. MicroCapital has been engaged to promote and report on the event each year since 2012. You may learn more about European Microfinance Week at https://www.emw2023.eu/.
Additional Resources
European Microfinance Week 2023 homepage
https://www.emw2023.eu/
European Microfinance Platform Action Groups
https://www.e-mfp.eu/action-groups
MicroCapital coverage of European Microfinance Week since 2012, including the European Microfinance Award
https://www.microcapital.org/category/european-microfinance-week/
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