Monday 14th November, 2011
2:20pm to 4:00pm
This concept paper reflects the vision of microfinance to be the sustainable provision of financial services to poor and low income households, as a key element of an effective poverty reduction strategy. The vision assumes a double bottom line approach: that a microfinance institution is a business that is financially sustainable (generates the revenue to cover its costs) and simultaneously creates social value.
At a time when the microfinance sector is under fire for mission drift and faces headline risk, a number of initiatives have emerged to address these challenges. These initiatives focus on various aspects: values of responsibility (for example the Smart Campaign on client protection and MicroFinance Transparency on transparent pricing), corporate ethics, and social performance management.
The Microcredit Summit Campaign intends to build on and complement these initiatives by introducing a Seal of Excellence for Poverty Outreach and Transformation in Microfinance. This Seal will serve as a tool to both recognize microfinance institutions with significant outreach to poor and excluded households, and develop a clear strategic approach to support the transformation of these clients.
The concept paper covers the rationale for the Seal, reviews related experiences in developing certifications in other fields (such as NGOs, fair trade, impact investing and sustainable agriculture), profiles other initiatives around financial and social performance in microfinance, shows what this Seal adds, and maps out a process for taking this initiative forward.
President, Fundación Microfinanzas BBVA, Spain
President, Foro Latinoamericano y del Caribe de Finanzas Rurales (FOROLACFR), Mexico
Senior Research Fellow, Freedom from Hunger, USA
CEO, Fonkoze Financial Services, Haiti
Managing Director, The Small Enterprise Foundation (SEF), South Africa
Director, EDA Rural Systems, India
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