Client Protection Certification: 'Fair Trade' for Microfinance?

> Posted by Center Staff
Do you depend on Fair Trade coffee to keep yourself from falling asleep while reading this blog?
That coffee is supposed to be produced with the minimum harm and the maximum good. To verify such claims, whether about your cup of joe, hand-woven rugs, or any other items, Fair Trade depends on reliable certification processes.
Can certification play a similar role in microfinance?
The Smart Campaign recently announced plans to launch a certification process that will enable MFIs worldwide to show that they follow the Campaign’s core Client Protection Principles as verified by third-party assessors.
Microfinance institutions that undergo such verification and earn certification will be able to assure clients and investors that they follow responsible practices that uphold the Client Protection Principles: 1) Avoidance of over-indebtedness; 2) Transparent and responsible pricing; 3) Appropriate collections practices; 4) Ethical staff behavior; 5) Effective complaint management; and 6) Securing the privacy of client data.
To learn about this work in progress, we invite you to watch the Center’s managing director, Beth Rhyne, as she is interviewed by Asad Mahmood, managing director of Deutsche Bank’s Global Social Investment Funds and a member of the Smart Campaign’s steering committee.