Why focus on client protection now?

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What is the Smart
Campaign for Client
Protection in
Microfinance?
A special presentation for YOUR
INSTITUTION made possible by
the Smart Campaign
www.smartcampaign.org
What is The Smart Campaign?
• Global, microfinance industry client protection
initiative
• Sharing tools, resources & best practices
• Collaboration of industry leaders from all
stakeholder groups
– 800-plus endorsers
– International Steering Committee
• Housed in Center for Financial Inclusion at
ACCION International
2
What is the Campaign’s vision?
• Put the interests of clients first
• Provide transparent, respectful services
• Distinguish microfinance industry as leader in
responsible finance
• Facilitate implementation of the client protection
principles
3
What is the Client Protection Webinar
Series?
• Seven presentations that outline client protection,
detail each principle, and discuss real-world good
practices and practitioner experiences
• Flexible tool for use by networks, MFIs, and other
organizations to create in-person seminars or
distance learning opportunities
• A product of the Smart Campaign
4
What are the client protection principles?
1. Avoidance of over-indebtedness
2. Transparent pricing
3. Appropriate collections practices
4. Ethical staff behavior
5. Mechanisms for redress of grievances
6. Privacy of client data
5
Why is client protection good for business?
• Creates client loyalty
• Increases client satisfaction & retention
• Strengthens institution’s reputation
• Helps builds healthy portfolio
6
Why focus on client protection now?
• Demands for accountability & transparency as a
result of the global financial crisis
• Microfinance crises in several countries
• Public & political concern over high interest rates
• Rising competition & consumer lending
7
Your perspective: Why focus on client
protection now?
• Why is your institution/network interested in client
protection?
8
Beyond Codes: An action research
project to operationalize Client Protection
Kenya
• Includes commercial MFIs, NGOs, and
credit unions
• Countries represent four regions
• Process:
• Guided self-evaluation of client
protection in the MFI
• Pilot Projects to improve operations
• Monitoring and lessons learned
• Develop criteria for a certification
process
• Sharing experiences
9
Bosnia-Herzegovina
Mexico
Philippines
India
Smart Campaign endorsers include
Institutions
• Banco Delta
• Banco Solidario
• BANEX
• Compartamos Banco
• Financiera el Comercio
• SKS
• WWB Colombia
Networks
• ACCION International
• Freedom from Hunger
• Opportunity International
• Pro Mujer
• ProDesarrollo
• Red Financiera Rural
• Unitus
• Women’s World Banking
Investors
• BlueOrchard
• Citigroup
• Credit Suisse
• Deutsche Bank
• INCOFIN
• Oikocredit
• ResponsAbility
• ShoreCap Management
• Triodos Investment Management
• Triple Jump
Governments / Donors
• BBVA Foundation
• IADB
• Japan
10
Next Steps
• We invite you to learn more about the Smart
Campaign at: www.smartcampaign.org
At the site you can:
• Join the Campaign as an individual or institutional
endorser.
• Download resources and tools to help examine
and improve the client protection practices at your
institution
• Download the rest of this training series to
continue learning about client protection.
11
Certification: The Long-Term Goal
• Create a certification
process in the coming years
• Design a ‘Seal of Quality’
(similar to ISO, Organic, Fair
Trade) that recognizes
microfinance practices that
promote client protection
• Certify leading institutions
worldwide
12
Discussion
You have learned what the Smart Campaign is and the
basics of the principles of client protection.
How can your organization become involved and
support client protection microfinance?
13
Next time…
We will discuss Principle #1:
Avoiding Client Over-indebtedness
We will examine concrete examples:
•Steps you can take to avoid client overindebtedness in your institution
•Strategies, incentives, and product designs that
facilitate prevention of over-indebtedness
•Examples of good and bad practices
14
Questions?
Contact the Smart Campaign
For more information visit:
www.smartcampaign.org
15
Join the Campaign &
Endorse the Principles of Client
Protection
www.smartcampaign.org
Thank you!
16
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