<h1>Why Consumer Rights and Responsibilities?</h1>
The <a href="https://www.smartcampaign.org/about/smart-microfinance-and-the-client-protection-principles">Client Protection Principles</a> provide a common framework for financial service providers (FSPs), policymakers, and clients to better understand and discuss consumer protection issues. While much of the Center for Financial Inclusion’s (CFI) work with the financial inclusion industry has focused on providers and regulators, there is a third crucial constituency: clients.

Client awareness and capability is a critical component of effective financial consumer protection. Clients have the right to demand fair treatment and lodge complaints with government authorities, but these rights mean little if they don’t know what constitutes lawful treatment or how to access complaints channels. Similarly, clients play a role in protecting themselves by practicing behaviors to maintain their privacy and safety. While FSPs can institute protective processes and regulators can craft policy safeguards, improving client awareness of their rights and responsibilities helps consumers play their part to support a sustainable financial system.

This report provides lessons learned from initiatives in Ghana, Uganda, and Benin to raise consumer protection awareness among clients through multimedia campaigns, digital tools and other outreach strategies. It covers country-specific consumer protection issues and the individualized campaigns to address these issues. We also offer five key takeaways to help inform future client protection and empowerment awareness building activities.

Clients Deserve to Know: Using Radio to Educate and Empower Consumers in Africa

In the past few months, questions have been raised about the quality of microfinance debt collection practices in Cambodia. A damning recent <a href="http://www.licadho-cambodia.org/reports.php?perm=228">report</a> by LICADHO, a Cambodian human rights organization, concluded that MFIs in Cambodia have relied on “inadequate government regulation and the widespread complicity of local authorities” to unethically and illegally force indebted Cambodian borrowers to sell their land titles in order to secure repayment. Borrowers, unaware that land seizures are illegal, are intimidated into doing so. Interviewees in the report also indicated other lender abuses, including child labor, debt-driven migration and food insecurity – all because they couldn’t pay loans on time. The report, which the Center for Financial Inclusion recommends reading, raises serious concerns about human rights and consumer protection.

CFI has been an advocate of consumer protection in Cambodia for <a href="https://www.cgap.org/blog/supporting-client-protection-cambodia">many years</a>, working with a variety of stakeholders in the country, including donors, financial service providers, clients and the government. We believe that using threats as a means to extract repayment is unacceptable, and the allegations from LICADHO should be taken seriously and further investigated. Responsible practices should be reinforced by providers as needed.
<blockquote>We believe that using threats as a means to extract repayment is unacceptable.</blockquote>
However, as the report itself and the Cambodia Microfinance Association (CMA) <a href="https://www.construction-property.com/lichado-report-selective-and-misleading-says-cma/">point out</a>, the results need contextualization. The sample size is very small – only 28 interviews were conducted in four provinces and Phnom Penh – and is not meant to be statistically representative of Cambodia or all MFI clients. All interviews were conducted in a very short timeframe: spring 2019. Are a small number of providers concerned, or is the report surfacing issues that indicate an existing (and possibly increasing) general crisis amongst MFI providers? While the issues raised in the report merit attention, even if they affect a proportionally small number of clients, it is important to understand the scope of the problem in order to determine how to adequately address it.

The <a href="http://smartcampaign.org/about/smart-microfinance-and-the-client-protection-principles">Consumer Protection Principles</a> contain strict guidelines that deter providers from violating borrowers’ human rights. Consumer Protection Principle 5, which concerns the fair and respectful treatment of clients, strictly prohibits Smart-certified financial service providers from using abusive language, using physical force, limiting physical freedom, shouting at the client, entering the client’s home uninvited, publicly humiliating the client, violating the client’s right to privacy, mistreating a client based on any protected groups, using intimidation or threats, sexual or moral harassment. Guideline 5.3.3 explicitly states that “the provider staff may not force clients to sell their own collateral to pay off their debt.”

But it’s not about just setting principles and hoping providers abide by them. The <a href="http://smartcampaign.org/certification">Smart Certification</a> process requires financial service providers to demonstrate their adherence to the Client Protection Principles and corresponding standards. It represents a rigorous analysis of an institution’s policies, systems and practices, carried out by licensed third-party organizations. Recognizing that organizations, regulations and product offerings evolve, our 115 certified-organizations worldwide are required to be recertified every four years, with a two-year check-in, and a required recertification if the organization goes through material change. Certification is a measure of whether an institution has adequate systems in place to prevent client harm, ensuring that harm isn’t occurring, and mitigate it if it is. The Cambodian microfinance sector, with support from CMA, has worked hard over the years to improve practices in order to meet the rigorous bar set by Smart Certification. Eight Cambodian institutions are currently Smart-certified: LOLC, Acleda Bank Plc, AMK, Hattha Kaksekar Ltd., Amret Microfinance, Sathapana Bank, VisionFund Cambodia, and Thaneakea Phum.

Through the assessment and certification process, widespread client abuses come to light and the institution is given recommendations on how to address them. On the other hand, one-off poor and abusive decisions on the part of selected individuals may not surface. This is why complementary research of alleged abuse, and the presence of well-functioning recourse mechanisms for clients are critical.
<h2>CFI's Role in Cambodian Consumer Protection</h2>
CFI started its engagement with the microfinance sector in Cambodia in 2012, a time when the Cambodian market, a victim of its own success, was growing at a pace seen by many as unsustainable: between 2004 and 2014 the growth in the average household loan size <a href="https://cma-network.org/files/OIDWORKSHOP/MIMOSA Circular Cambodia Jun 2016.pdf">outpaced growth</a> in average client income by a factor of four. CFI convened key funders of the main MFIs and encouraged them to embrace Smart certification as part of their screening and due diligence process to ensure that providers had adequate policies and practices in place to prevent over indebtedness and poor client treatment. In the years that followed, and with generous support from the Agence Francaise de Développement (AFD), CFI supported an ambitious consumer protection program aimed at developing the country’s credit bureau, strengthening the capacity of the Cambodia Microfinance Association (CMA) and improving practices of the main financial service providers (FSPs) to the poor in the country.

FSP practices drastically improved as part of this work. Collectively, the eight Smart Certified institutions in Cambodia serve 1.6 million clients. This is an incredible achievement for the sector, as these clients are served by institutions that have committed (and demonstrated) that they have put in place systems and processes to protect their rights and treatment. Preventing over indebtedness is complex, especially in the context of fast-growing markets and an environment where lenders are not always required to report to the credit bureau.
<blockquote>The eight Smart Certified institutions in Cambodia serve 1.6 million clients.</blockquote>
<h2>Lending Guidelines</h2>
As concerns of over indebtedness have continued to <a href="https://mimosaindex.org/inexorable-growth-in-cambodia-like-a-rolling-stone-2/">rise over the years</a>, concerned players decided to go a step further and understand better the underpinnings of growth in the Cambodian market, as well as ways to ensure a responsible growth. Since 2016, the <a href="https://cma-network.org/">CMA</a>, <a href="http://www.incofin.com">Incofin</a>, <a href="https://mimosaindex.org/">MIMOSA</a>, the Credit Bureau of Cambodia, the Smart Campaign at CFI, and several other stakeholders have been developing and refining the CMA Lending Guidelines. The <a href="https://www.microcapital.org/special-report-a-model-from-cambodia-for-preventing-overheating-not-just-multiple-lending-to-be-presented-at-european-microfinance-week-november-14-16-2018/">project</a> was funded by Incofin, <a href="https://www.proparco.fr/en">PROPARCO</a>, BIO, <a href="https://www.fmo.nl/">FMO</a> and <a href="https://www.ada-microfinance.org/en">ADA</a>.

The Lending Guidelines, published in 2016 (overview <a href="http://www.e-mfp.eu/sites/default/files/resources/2018/11/Preventing overindebtedness in Cambodia_all speakers.pdf">here</a>), were developed because the industry in 2015 was growing at an average of 25 percent per year, even as the number of loans remained unchanged at 2.3 million. This meant that the same clients were taking more debt when their loans were renewed, even though their economic activities did not justify it. The average loan size had almost doubled, growing from close to $1,700 to a little over $3,000 with loan maturity of four to five years (the GDP per capita in 2017 stood at around $1,400). The Lending Guidelines have identified excessive and reckless refinancing as a key concern area for the lending sector, and recommend maximum thresholds for refinancing, above which lenders are bound to more scrutiny. They include a mix of indicators highly correlated to over indebtedness, such as multiple borrowing, loan to income ratio, and refinancing rates.
<blockquote>The Lending Guidelines have identified excessive and reckless refinancing as a key concern area for the lending sector.</blockquote>
The FSPs that have endorsed the lending guidelines have adapted their credit their underwriting policies and enhancing their risk management practices. The National Bank of Cambodia (NBC) has been supportive of the Lending Guidelines and has made public statements on calling FSPs to adopt them. The Central Bank of Cambodia issues a monthly dashboard that shows the FSPs level of compliance with the Lending Guidelines. The Lending Guidelines have been fully integrated into the Smart Certification process and not abiding to the Lending Guidelines can be one of the causes for not having a Certification renewal. The Lending Guidelines are reviewed to ensure that they are meaningful in curbing the risk of over-indebtedness. The Lending Guidelines are an example of a market defining precise recommendations to address a specific issue occurring in a market (here, excessive refinancing). As other issues surface and are demonstrated (i.e., intimidation and illegal land seizure), additional monitoring and mitigation strategies can be put in place at the market level to address systemic issues and complement the individual work of responsible providers.
<h2>Next Steps: Improving Regulation and Learning From Clients</h2>
I recently traveled to Phnom Penh to attend a closed meeting of regulators, hosted by the NBC and supported by Asian Development Bank, to discuss how authorities can improve oversight. There were a few key takeaways from this. Even though the NBC is actively working on draft consumer protection regulation, current financial consumer protection regulations are weak. The National Bank of Cambodia is dependent on the CMA to mitigate the risks that are looming over the sector. There is, however, an initiative in an initial phase to create a registry of collaterals, assets, and fixed values. Overall, it’s encouraging to see that there’s consensus on the necessity for more sensitization of regulators on consumer protection, as the national financial inclusion strategy is more heavily focused on credit report sharing. The CFI is excited to work with the NBC, drawing from the <a href="https://www.smartcampaign.org/tools-a-resources/1210-handbook-on-consumer-protection-for-financial-inclusion">Handbook on Consumer Protection for Financial Inclusion</a> (recently updated to reflect the risks to consumers in a digital financial world) to improve the Cambodian regulatory framework.
<blockquote>It’s encouraging to see that there’s consensus on the necessity for more sensitization of regulators on consumer protection.</blockquote>
In addition to improving the regulatory framework, we must have better and more frequent ways to hear from clients directly.

With this in mind, we ask: is collateralized debt seizures a troubling and growing trend, or was the LICADHO study reflecting isolated incidences of mistreatment? We hope that a new study initiated by CFI will help shed light on the issue. The study, known as Client Voice, uses an interactive voice response (IVR) approach. Three Smart Certified FSPs – AMK, Maxima and HKL – will participate, and 500 to 1,000 clients from each institution will be surveyed. Institutions that are at the stage of transforming to digital product offerings – such as AMK – are looking to adopt new and better ways to gather ongoing feedback from clients to improve their product design and delivery and are keen to test the IVR system to that effect. The study will be completed by December 2019, and the results will be published by January 2020.

Land Seizures and Reported Abuses in Cambodia: CFI Responds

As digital technologies transform inclusive finance, with new providers, products, and delivery channels reaching out to the financially excluded, the need increases for effective legal and regulatory frameworks to protect low-income consumers. When considering the organizing question for <a href="/financial-inclusion-week-2019">Financial Inclusion Week 2019</a> “Financial Inclusion: For What?” the theme of equity looms large. If the rules of the road for digital financial services (DFS) aren’t predictable, balanced between mitigating consumer risks and fostering innovation, or considering the voice of consumers, financial inclusion cannot deliver on its promises of fair access, fair use, or fair treatment. A sound legal framework for consumer financial protection will support financial inclusion and innovation, allow new products and services to responsibly reach previously underserved consumers, and provide for empowered and capable regulators to oversee and enforce these frameworks.

<strong>The Center for Financial Inclusion at Accion and DLA Piper/New Perimeter are pleased to launch updated and revised guidance for financial consumer protection regulators tackling the risks and opportunities introduced by digital financial services.</strong> The <a href="http://smartcampaign.org/tools-a-resources/1210-handbook-on-consumer-protection-for-financial-inclusion">Handbook on Consumer Protection for Inclusive Finance</a>, a joint project between experts at the Center for Financial Inclusion at Accion, Accion, and DLA Piper/New Perimeter, presents updated and revised guidance for consumer financial protection regulators organized around the Smart Campaign’s <a href="https://www.smartcampaign.org/about/smart-microfinance-and-the-client-protection-principles">Client Protection Principles</a> regarding the unique characteristics of DFS, with an emphasis on digital credit.

<strong>Join experts from Accion and New Perimeter on October 25 at 9:30 a.m. EST for a webinar to discuss how the regulatory landscape is shifting with the advent of digital financial services, the challenges policymakers are facing, and the ways that this Handbook can help regulators and the entire inclusive finance industry to strengthen consumer protection frameworks.</strong>

Webinar: A Conversation About the Handbook on Consumer Protection for Inclusive Finance

<em>This post originally appeared on the European Microfinance Platform's (e-MFP) <a href="http://www.e-mfp.eu/blog">blog</a>.</em>

How should financial institutions approach consumer protection differently when they offer services through smartphones rather than humans?

This was the question we posed when the <a href="https://content.centerforfinancialinclusion.org/about/what-we-do/the-smart-campaign/">Smart Campaign</a> team first started revising the standards to be applied to digital financial services, especially digital credit. We're very pleased to have launched the new <a href="http://www.smartcampaign.org/about/smart-microfinance-and-the-client-protection-principles/digital-credit-standards">Digital Credit Standards</a>, their accompanying <a href="http://www.smartcampaign.org/storage/documents/2019_06_19_Principles_Guidelines_FINAL2.pdf">guidance document</a>, and the forthcoming companion Handbook on Consumer Protection for Financial Inclusion (summary <a href="https://www.smartcampaign.org/storage/documents/Handbook_on_Consumer_Protection_-_Eng.pdf">here</a>). What we didn’t expect, however, was quite how profound the differences would turn out to be. We made significant changes to the standards for all seven Client Protection Principles (the principles themselves remain the same). I want to focus here on the most fundamental: Appropriate Product and Delivery Design.

When financial service providers (FSPs) consider tackling client protection, their first thought is often, “We need a code of conduct!” That reflexive response shows that FSPs traditionally view protecting clients mainly through the lens of setting and enforcing boundaries on staff behavior. And traditionally, that made sense. After all, ground zero for protecting clients occurs in the moments when they come face to face with staff. That’s when the client receives product information that is transparent (or not) and is treated (or not) with fairness and dignity. The practice of client protection has centered on defining codes of conduct, incentivizing and training staff to follow them, monitoring their adherence, and applying sanctions to breaches.
<h2>When face-to-face interaction disappears, what happens to consumer protection?</h2>
When staff aren't present, however, the client experience changes. On the one hand, the problem of rogue or substandard staff behavior disappears, which is good for clients. But so does the helpful staff person who can answer a client’s questions and guide the client to the right product. With digital services, everything the client experiences is pre-programmed and embedded into the user interface upfront, before a single client has clicked on a single screen. Everything is determined in advance, through coding and algorithms, and the sequences roll along without individual human intervention.

In this setting, protecting clients is all about good design. But product and delivery design teams in FSPs include a range of people, not all of whom are traditionally alert to client protection: the IT team, the market research and marketing teams, commercial analysts, and possibly outside software developers. Team members come from different disciplines with different training and skills, and they may not even be aware of client protection principles. These teams need guidelines to assist them in integrating protections into the interfaces they ultimately design. For example, designers need to determine whether clients are likely to understand the product information they provide in a setting where they can't easily ask questions. Those involved in market research and prototype testing need to have client protection issues in the forefront of their minds as they do their work.

To do this, they need a “code of conduct” for the design process, and that is how we think about the new standards for appropriate product and delivery design. We call the approach “protection by design,” taking a cue from the concept of privacy by design often advocated as a rubric for data privacy. Protection by design is a vastly different approach to implementing client protection from the old codes of conduct. The focus is what goes into the product, rather than how the staff member behaves with each individual. Protection by design focuses on anticipating the totality of needs of all clients and incorporates them right from the start.

And that brings up another profound difference between traditional client protection practice and the new standards. When the focus is on ensuring that the staff conducts successful interactions with each client, adherence is monitored on an ongoing basis through everyday work. With protection by design, and its focus on getting it right in advance for the whole portfolio of clients, the staff stand back and watch machines do the work. There is no daily staff feedback to tell supervisors whether client outcomes are satisfactory. Thus, in protection by design, systems and methods for monitoring client outcomes – through portfolio data and direct client surveys – become essential.
<blockquote>When the focus is on ensuring that the staff conducts successful interactions, adherence is monitored. With protection by design, the staff stand back and watch the machines do the work.</blockquote>
We're just at the start of understanding these and other implications of protection by design for the practice of client protection. The Smart Campaign looks forward to engaging with members of <a href="http://www.e-mfp.eu/">e-MFP</a> to build out and test robust tools that can enable the approach to be widely applied. We’d like to work out how to incorporate client input and testing during the design process, protocols for algorithm review and other facets of the new approach.

Beyond protection by design, the revised standards for digital financial services incorporate several other very important changes, some of which are among the hottest issues in the sector today: data privacy, data security, and the thorny question of fairness and responsibility in algorithm-based lending. The Smart Campaign will dig deeper into these issues during the coming year.

We would like to thank all those who worked with us in designing the standards, especially MFR and the members of the <a href="https://www.smartcampaign.org/about/fintech-protects-community-of-practice">Fintech Protects Community of Practice</a>. It has been a community effort.

In a world that is changing very rapidly, we consider the client protection standards to be a permanent work in progress, anticipating that they will need to be adapted as new developments in financial services occur. At this stage, our hope is that the players in the financial inclusion sector will actively promote and use the new standards to ensure that the sector does right by its clients, no matter what methods it uses to deliver its services.

We invite you to review the <a href="http://www.smartcampaign.org/storage/documents/Digital_Credit_Standards_June_2019.pdf">standards</a> and send us your thoughts by commenting below.

From Human Conduct to Protection by Design: The Smart Campaign's Digital Standards

We are pleased to participate in the following two sessions during the official program at European Microfinance Week 2019. Join us!
<h2>Atlas Data Platform: A New One-Stop-Shop for the Sector</h2>
<h3>Thursday, November 21, 2019
3:45 - 5:15pm (CET) / 9:45 - 11:15 (EST)</h3>
<a href="/bio/isabelle-barres">Isabelle Barres</a>, Campaign Director, <a href="/about/what-we-do/the-smart-campaign">The Smart Campaign</a>, joins on a panel alongside BFR, CERISE, MFR and SPTF to demo and discuss the Atlas Data Platform on pricing, client protection, social, environmental and financial performance of approximately 600 financial service providers (FSPs) from 70 countries. Investors, networks, researchers and other subscribers will be able to use this data to benchmark FSPs with peers, monitor their evolution, consolidate portfolios, review country profiles, research industry trends, and analyze data through the lens of the Sustainable Development Goals. The Atlas Data Platform will be launched in 2020.
<h2>Responsible Client Choices in Finance: Whose Responsibility Is It? (Closing Plenary)</h2>
<h3>Friday, November 22, 2019
3:30 - 4:45pm (CET) / 9:30 - 10:45 (EST)</h3>
CFI Managing Director <a href="/bio/mayada-el-zoghbi">Mayada El-Zoghbi</a> joins Gerhard Coetzee, CGAP, Tim Odgen, Financial Access Initiative, and Roshaneh Zafar, Kashf Foundation, to debate the tension between client choice and client protection. While client protection is a foundation of responsible finance, implementing it requires wrestling with a fundamental question: when does protection become a paternalistic limitation on client choice?  Among responsible finance adherents, there is universal agreement that clients should be provided with clear, simple information in order to make financial decisions. But often this is seen as insufficient, and institutions and regulations go further, limiting or prohibiting certain practices because they are deemed irresponsible—thus also limiting client choices. This session will use a free debate format to explore the challenge of balancing between these two objectives—client choice and client protection.

European Microfinance Week 2019

Digital credit has emerged as a new and profitable service offering that has great potential to increase financial inclusion. Yet, if not carefully managed, digital credit also runs the risk of excluding, over-charging, and over-extending customers.

Seven years since the first digital credit product launched, the market in Kenya has grown exponentially and hosts a diverse ecosystem with more than 50 supply-side actors. The phenomenal expansion of digital credit in Kenya serves as a test-bed for the product and offers lessons for digital credit suppliers and regulators around the world.

SPTF and the Smart Campaign commissioned MicroSave Consulting (MSC) to study the dynamics of the digital credit sector on both demand and supply sides. The output of the study was a <a href="https://content.centerforfinancialinclusion.org/making-credit-truly-responsible-webinar/">comprehensive report on the current state of digital credit in Kenya</a>. It looked at the evolving challenges in digital credit and made recommendations for a more responsible and customer-centric delivery of the product.

With participation from Smart Campaign Senior Director Alexandra Rizzi, this webinar:
<ul>
 	<li>Helps participants understand the digital credit landscape in Kenya</li>
 	<li>Assesses the progress and challenges around making digital credit responsible and inclusive</li>
 	<li>Recommends steps towards a more responsible delivery of digital credit</li>
</ul>

Making Digital Credit Truly Responsible Webinar

All is not well in the country that pioneered mobile credit. A new <a href="/making-digital-credit-truly-responsible">report on digital credit in Kenya</a> from <a href="https://www.microsave.net/">MSC</a>, commissioned by <a href="/about/what-we-do/the-smart-campaign">the Smart Campaign</a> and the <a href="https://sptf.info/">SPTF</a>, shows that with continued dramatic growth rates, the sector also experiences cripplingly high default and delinquency, enabled by poor business practices and weaknesses in both the credit reporting infrastructure and regulatory jurisdiction.

Most notably, the report reveals very high rates of delinquency and default. Among active digital loans, more than a quarter are non-performing. About 2.2 million Kenyans are said to have delinquent loans. In some cases, liberal use of refinancing and rescheduling hides this level of delinquency in lender portfolios. At the same time, the report points out that about half of these non-performing loans are for amounts less than $10. These findings are broadly consistent with results cited by CGAP in 2016, which found that 50 percent of digital borrowers in Kenya repaid their loans late, and 12 percent defaulted.
<blockquote>Despite continued growth of digital credit in Kenya, high delinquency, default and interest rates persist in the market and credit bureaus haven't yet caught up with the digital age.</blockquote>
The report also details shortcomings in credit reporting, given that many digital lenders neither consult nor report to the credit reporting bureau as fully or regularly as they should. The credit reporting bureaus were clearly set up for a pre-mobile era, which suffer from issues related to inclusion of all types of lenders, frequency of uploading data (monthly, when daily is more relevant for today’s short term loans), and ease of connection among all the players in the credit reporting ecosystem. As a result, many lenders are not consistently using credit bureaus—neither ensuring that the information is updated and correct, nor fully consulting it prior to lending.

Pricing is also an issue. The market leader, M-Shwari, which accounts for about two-thirds of all digital loans, charges an annual percentage rate (APR) of 90 percent. The low-price option provided by Kenya Commercial Bank is a fairly reasonable 44 percent APR, but the high end of the price range includes providers charging APRs well into the hundreds. Granted that these are small, short term loans where interest payments are not expected to be sustained for an entire year. Nevertheless, the promise of digital to bring down prices does is not yet in sight.

Other issues noted in the report include non-transparency regarding portfolio quality, identity theft, misuse of client data, multiple borrowing and loan bicycling by clients, and client use of loan proceeds for sports betting.

The picture that emerges suggests that the still-exploding market of very small, “nano” loans needs to be brought into more orderly operation. Consumers and providers are operating in risky ways. The current state of the market is not beneficial for either.
<blockquote>Raising the bar for blacklisting customers and public awareness about defaulting on loans are among our recommendations for improving digital credit.</blockquote>
One issue specific to this nano-loan market concerns the reporting of very small non-performing loans to credit bureaus, with negative consequences, such as curtailing of access to credit, for hundreds of thousands of borrowers. MSC, the Smart Campaign and SPTF recommend that regulations be put in place such that delinquencies and defaults among loans below some fixed amount not be reported to the credit bureau (whether US$2, $5 or $10 – the report actually recommends a cutoff of 5% of the monthly per capita GDP). It also recommends that the government launch a public awareness campaign about how credit bureaus work and the consequences of default so consumers will better understand the risks involved in borrowing.

The regulators, credit reporting agencies and lenders in Kenya are aware of these concerns and working to improve the situation. A new association of digital lenders (Digital Lenders Association of Kenya) has been formed to create consumer protection standards and the central bank is exploring ways to upgrade the credit reporting ecosystem. The Smart Campaign recommends that both lenders and regulators consider adopting the <a href="http://www.smartcampaign.org/about/smart-microfinance-and-the-client-protection-principles/digital-credit-standards">digital credit standards</a> and <a href="https://www.smartcampaign.org/tools-a-resources/1210-handbook-on-consumer-protection-for-financial-inclusion">model regulations</a> covering issues ranging from transparency, to the fair use of algorithms, to protection of customer data.

Kenya’s unprecedented dynamism in mobile money, digital credit and financial inclusion is envied across the world. If authorities and providers can bring the participants in these sectors into a better-functioning marketplace, Kenya will benefit greatly from the innovation the country continues to spawn.

Red Flags in Kenya’s Nano-Credit Market

<span class="hotkey-layer ">Digital credit has emerged as a new and profitable service offering that has a great potential to increase financial inclusion. Yet, if it is not carefully managed, digital credit runs a great risk to exclude, over-charge, and create over-indebtedness.</span>

<span class="hotkey-layer ">During the first half of 2019, The Smart Campaign and the Social Performance Task Force (SPTF) commissioned Microsave Consulting (MSC) to study the current state of digital credit in Kenya and formulated recommendations for how to make digital credit delivery safer and more customer-centric. We propose that </span>regulations be put in place such that delinquencies and defaults among loans below some fixed amount not be reported to the credit bureau so as not to unduly burden consumers. We also call for increased public awareness campaigns about how credit bureaus work and the consequences of default so consumers will better understand the risks involved in borrowing.

More generally, the Smart Campaign recommends that both lenders and regulators consider adopting the <a href="http://www.smartcampaign.org/about/smart-microfinance-and-the-client-protection-principles/digital-credit-standards">digital credit standards</a> and <a href="https://www.smartcampaign.org/tools-a-resources/1210-handbook-on-consumer-protection-for-financial-inclusion">model regulations</a> covering issues ranging from transparency, to the fair use of algorithms, to protection of customer data.

Making Digital Credit Truly Responsible

Digital credit has emerged as a new and profitable service offering that has great potential to increase financial inclusion. Yet, if not carefully managed, digital credit also runs the risk of excluding, over-charging, and over-extending customers.

Seven years since the first digital credit product launched, the market in Kenya has grown exponentially and hosts a diverse ecosystem with more than 50 supply-side actors. The phenomenal expansion of digital credit in Kenya serves as a test-bed for the product and offers lessons for digital credit suppliers and regulators around the world.

SPTF and the <a href="/about/what-we-do/the-smart-campaign">Smart Campaign</a> commissioned MicroSave Consulting (MSC) to study the dynamics of the digital credit sector on both demand and supply sides. The output of the study was a comprehensive report on the current state of digital credit in Kenya. It looked at the evolving challenges in digital credit and made recommendations for a more responsible and customer-centric delivery of the product.

With participation from Smart Campaign Senior Director <a href="/bio/alexandra-rizzi">Alexandra Rizzi</a>, this webinar will:
<ul>
 	<li>Help participants understand the digital credit landscape in Kenya</li>
 	<li>Assess the progress and challenges around making digital credit responsible and inclusive</li>
 	<li>Recommend steps towards a more responsible delivery of digital credit</li>
</ul>
We hope you can join us!

<img class="alignnone size-large wp-image-36766" src="https://content.centerforfinancialinclusion.org/wp-content/uploads/sites/2/2019/09/MSC_Webinar-1-1024x683.jpg" alt="Infographic describing webinar schedule" width="1024" height="683" />

Webinar: Making Digital Credit Truly Responsible

Bansal, the <a href="https://www.centerforfinancialinclusion.org/about/what-we-do/the-smart-campaign">Smart Campaign</a>'s Senior Director in South and Southeast Asia, notes that the problem over-indebtedness is more severe in the island country than elsewhere.

She also points out that the government's decision to write off business loans of up to 100,000 rupees falls short.

"One-off measures will not do, says Ms Bansal: Sri Lanka needs properly enforced rules that prevent over-indebtedness and ensure fair treatment of borrowers."

<strong>Read the <a href="https://www.economist.com/finance-and-economics/2019/08/15/microfinance-is-driving-many-sri-lankan-borrowers-to-despair">full article</a> (soft paywall).</strong>

In The Economist: Hema Bansal on Over-Indebtedness in Sri Lanka

Malacci Ohrt

Alexandra (Alex) Rizzi

Alex Kessler

Hema Bansal

Elisabeth Rhyne

Mayada El-Zoghbi

Isabelle Barrès

Boubacar Diallo

Ezra Mannix

Benin

Ghana

Uganda

Cambodia

East Asia and Pacific

Kenya

Sub-Saharan Africa

Burkina Faso

Rwanda

Consumer Protection

Credit

Data Privacy

Data Transparency

Digital Financial Services

Enabling Environment

Financial Capability

Fintechs

Fraud

Policy, Regulation and Government Initiatives

Responsible Digital Finance

Financial Inclusion Strategy

Responsible Product Design and Delivery

Customer Centricity

Partnerships

Impact Investing

Agent Banking

Digital Payments

Mobile Banking

Underserved Groups

Report

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The majority of Kenyans have mobile money accounts; their activity demonstrates digital financial services’ potential. Accion helps Kenyan innovators harness emerging technologies to create new financial services.

Fintech investment and growth are occurring in relatively limited areas and for a handful of high-profile companies. Enabling regulatory environments and well-informed investment flows are prerequisites to realizing the potential of fintech to achieve scale and impact. On October 23<sup>rd</sup>, as part of SAM 2019, <a href="/bio/boubacar-diallo">Boubacar Diallo</a>, Senior Africa Advisor, Smart Campaign, will present on a panel entitled <em>Fueling Fintech: Regulations and Investment for Scale and Impact</em>.

Key Questions
<ul>
 	<li>What examples do we have of successful legislation and investment environments to promote fintech development, and how can other markets replicate these successes to pave the way to more diverse and durable growth of digital financial services?</li>
 	<li>How can investors better evaluate investments with regard to the SDGs?</li>
</ul>
<a href="https://www.ada-microfinance.org/en/presentation-sam-2019">African Microfinance Week</a>/Semaine Africaine de la Microfinance (SAM 2019) is a biennial conference dedicated to the development of financial inclusion in Africa. The <a href="/about/what-we-do/the-smart-campaign/">Smart Campaign</a> will participate in this year’s conference, taking place October 21-25, 2019 in Ouagadougou, Burkina Faso, on the theme “Pathways Toward Impact: African Inclusive Finance for the Sustainable Development Goals.”

More details to come. Hope you can join us.

African Microfinance Week (SAM 2019)

<em>This post was originally published on the FinDev Gateway <a href="https://www.findevgateway.org/blog">blog</a>.</em>

Last week the <a href="https://www.centerforfinancialinclusion.org/about/what-we-do/the-smart-campaign">Smart Campaign</a> launched new <a href="http://www.smartcampaign.org/storage/documents/Digital_Credit_Standards_June_2019.pdf">standards</a> and <a href="https://www.smartcampaign.org/storage/documents/2019_06_19_Principles_Guidelines_FINAL2.pdf">guidance</a> covering digital financial services, especially credit. This is a milestone for the Campaign, and a step forward for protecting consumers who are accessing financial services digitally for the first time. We would like the standards to be widely used to guide the practices of both fintechs and traditional financial service providers undergoing digital transformation.

Through the in-depth research, piloting and consultation to prepare these standards, we have developed an approach to consumer protection for digital credit that is in many ways familiar and in other ways brand new. The Client Protection Principles, from transparency to fair and respectful treatment, continue to be the bedrock on which the standards are based, and many of the original standards still apply with few or minor changes.

But there is also big news in these standards. They shift the emphasis in application of consumer protection from staff and operations toward product design and delivery. When services are delivered primarily through front line staff or loan officers, clients are protected by ensuring that staff are well-trained and properly incentivized. With digital services, the consumer experience is embedded in the design of the product and user interfaces – largely in advance. This is a profound shift. To ensure consumer protection, digital financial service providers will need to institute practices in the design process to confirm that consumer risks are mitigated. These practices are only now emerging in the sector.
<blockquote>There's big news in these standards: They shift emphasis in application of consumer protection from staff &amp; operations to product design &amp; delivery.</blockquote>
For example, we propose that to protect clients against over-indebtedness in digital lending, where predictive algorithms substitute for repayment capacity analysis, providers must regularly review the choices embedded in the algorithm and selection of data points (ex ante measures), and they must monitor results in the portfolio and directly with clients (ex post measures).

Similarly, there is a broad shift in emphasis from Client Protection Principle #5, Fair and Respectful Treatment, to an expanded Client Protection Principle #1, reformulated as Design of Products, Services and Delivery Channels. In non-digital models the standards around fair treatment focus on staff behavior toward clients, such as codes of conduct and sanctions for lapses. In the new standards, more attention is given to ensuring that the design process incorporates client input and that predatory or deceptive sales and marketing techniques are not programmed.

Another big change in the standards is the elaboration of the Privacy of Client data principle, which has been reformulated as Privacy, Security and Integrity of Client Data. When the Smart Campaign began, data privacy was often regarded as the least important of the principles, but today it is a major concern, as financial service providers and their partners have, use and share so much more client data. Many providers have not yet determined what privacy policies to follow or how to implement them. Informed consent is a starting point, as the standards state, but we are also looking at ways to bake privacy protections into design. As more data is manipulated, stored and moved from place to place, risks increase for data breaches and misuse, prompting us to also deepen attention to cybersecurity.
<blockquote>As more data is manipulated, stored and moved, risks increase for data breaches &amp; misuse, prompting us to deepen attention to cybersecurity.</blockquote>
A final noteworthy shift is the use of partnerships (including agents) to deliver products, which makes it harder to assign responsibility for client mistreatment. For example, an agent may be managed by a network operator while selling products of a bank or other financial service provider. When something goes amiss, it should be made clear who is responsible to make the client whole. The standards call on providers to discuss relevant practices with partners and secure agreement for partners to meet high standards, wherever possible.

As a first cut at a complete set of consumer protection standards for digital services, we recognize that these standards will need to continue to be tested and refined. An enormous thanks to the organizations who worked with us to develop the standards, particularly the <a href="http://www.smartcampaign.org/about/fintech-protects-community-of-practice">Fintech Protects</a> community of practice and <a href="https://www.mf-rating.com/">MFR</a> (formerly Microfinanza Rating), as well as to the many people who provided comments and critique. We continue to welcome your feedback. Meanwhile, we call on digital financial service providers around the world to apply the standards so that they and their consumers will face fewer risks and receive the value they seek from using financial services.

Consumer Protection in a Digital Age

This week the <a href="https://www.centerforfinancialinclusion.org/about/what-we-do/the-smart-campaign/">Smart Campaign</a> is celebrating its 10th anniversary year with a bang by releasing its new standards for digital financial services. These standards represent the opening of a new phase for Smart to meet the growing challenges of the digital age.

The Smart Campaign began in the context of the 2008 global financial crisis. The financial system, and indeed the world economy, had just been brought down by interlocking defects in the financial system, a chain of events triggered by reckless lending in the U.S. mortgage market. A parallel phenomenon was taking place in the microfinance market in countries as diverse as India, Nicaragua and Morocco, with fast growth and commercialization leading to widespread over-indebtedness among customers, and a resulting backlash in public opinion. Customers suffered and providers lost the trust they had enjoyed. No greater object lesson can be imagined for prompting a focus on <a href="https://www.centerforfinancialinclusion.org/topics/consumer-protection">consumer protection</a>.

Smart quickly became a vehicle for the growing community of financial service providers, investors, regulators and support organizations who wanted to embed consumer protections into the microfinance sector. With the <a href="http://www.smartcampaign.org/about/smart-microfinance-and-the-client-protection-principles">Client Protection Principles</a>, the community created a common language and, with detailed guidance, standards and tools, it improved consumer protection and built trust.

Over the past decade, Smart has expanded its reach into the broader financial inclusion sector, and now there are thousands of endorsers and networks of providers and practitioners around the world who are engaged in embedding client protection standards into their products and practices. Today, more than <a href="http://www.smartcampaign.org/certification/certified-organizations">115 financial service providers</a>, serving over 45 million customers, have been awarded the <a href="http://www.smartcampaign.org/certification/all-about-certification">Smart Certification</a> seal, which demonstrates their commitment to treat customers with fairness and respect. <a href="https://www.centerforfinancialinclusion.org/the-business-case-for-smart-certification">Investors have adopted</a> the standards in their due diligence and social impact assessments. Regulators in many countries rely on the principles and the Smart’s research to design policies that balance client risk with provider sustainability, taking the voices of both providers and clients into account. Smart has facilitated the collaboration needed to create a world in which clients can access financial services with confidence.

In recent years, Smart has examined the new risks emerging as financial inclusion goes digital. Digital financial services make access much more available and more convenient for many of the people who were previously excluded, but care is needed to get it right for the vulnerable. After much research and consultation, we've developed practical guidance and standards for digital providers.
<blockquote>After much research and consultation, we've developed practical guidance and standards for digital providers.</blockquote>
As we launch these new standards, we see some parallels with the situation ten years ago, though with different headline risks. In the mainstream economy, concerns over the <a href="https://www.centerforfinancialinclusion.org/financial-inclusion-responds-to-the-zuckerberg-moment">rising power of “big tech”</a> and the appropriate use of personal data are causing widespread anxiety and mistrust. In the financial inclusion sector, data privacy and protection are also <a href="https://www.centerforfinancialinclusion.org/consumer-harm-from-data-breaches-is-a-black-box">central concerns</a>. The Smart Campaign standards address these concerns, as well as more traditional issues like over-indebtedness and transparency, which must be handled differently when digital interfaces replace face-to-face. Smart commends digital financial services for giving more people greater access to powerful financial tools. Our goal is to ensure that the digital revolution develops in a way that is healthy for customers and providers alike.

A heartfelt thank you goes out to all who have been part of this movement. We are thrilled to continue this journey together with many partners who are old friends and many more who are new ones. As we celebrate a decade of practical action to instill good practices, we ask stakeholders across the sector to join us in ensuring that the digital revolution builds trusting relationships and mutual benefits for customers and financial service providers well into the future.

<em>Stay tuned for an upcoming post on the launch of the digital standards, which will provide in-depth discussion of the new standards. For now, this <a href="https://www.centerforfinancialinclusion.org/help-us-shape-standards-for-responsible-digital-lending">post from the standards’ comment period</a> provides more detail on what these standards are.</em>

Smart Campaign’s Next 10 Years to Start With New Digital Standards

Today there are close to 700 million mobile money accounts registered worldwide — a number that, if it were a population, would rank as the world’s third-largest country. East Africa continues to lead in digital financial innovations as well as account usage, with two-thirds of the combined adult populations of Kenya, Rwanda, Tanzania, and Uganda actively using mobile money. With the proliferation of mobile financial services, particularly among underserved populations, it is vital that users be treated fairly and with dignity. In the momentum to define responsible digital finance and recognize providers of high-quality financial services, the industry must not forget the consumer.
<h1>Client Voices: Why We Listened</h1>
<a href="/about/what-we-do/the-smart-campaign/">The Smart Campaign</a>, a global initiative to create an environment in which financial services are delivered safely and responsibly to low-income clients, has long recognized that client perspectives are often underrepresented in consumer protection discussions. With the Client Voices Project, the Campaign questions whether the industry’s assumptions about what constitutes problematic treatment rightly reflect what clients themselves worry about.

The dual objectives of the project are to solicit input from low-income clients about what they consider good and bad treatment in their interactions with financial service providers and to assess the prevalence of consumer protection problems among these clients, using quantitative surveys. The project is designed to act as a catalyst for financial service providers, regulators, industry associations, consumer advocacy groups, and others to improve client protection in ways that are grounded in client feedback.
<h1>Major Findings</h1>
Based on a survey of over 1,200 people in three districts in Rwanda, this report delves into the experiences of individuals who use digital financial services (DFS), the main client protection issues they are concerned about, and the impact and prevalence of negative experiences. We find that mobile money enjoys a high degree of satisfaction and trust from clients in Rwanda, even though 40 percent of clients report being targeted by fraudulent schemes, which have become increasingly sophisticated.
<blockquote>Customers report wising up to scams and fraud, but with a continuous influx of new mobile money users and fraudsters who innovate quickly, the threat is real and constant. Fraud represents the greatest potential to damage customer trust and engagement with mobile money in Rwanda.</blockquote>
However, there are many ways that DFS operations and practices can be improved to better protect clients and strengthen trust. Client recourse mechanisms, for example, represent an important area for improvement: many clients shared that they feel helpless and unsure about what to do after realizing they have been duped. Additionally, for business models that rely more on the mobile interface than on human interaction, clients increasingly rely on agents for information and guidance. This presents an opportunity to provide better service, as well as a risk for poor client treatment.

We hope that providers, industry associations, support organizations, regulators, consumer protection advocates, and clients can benefit from these findings to create a stronger, more inclusive client protection ecosystem. We offer specific recommendations for many of these stakeholders.

Client Voices: Rwandans Speak on Digital Financial Services

<a href="https://libra.org/en-US/">Libra</a>, a new digital currency backed by blockchain technology and introduced today by Facebook, has the potential to reach any consumer with a digital connection. It’s exciting news for the 3 billion people worldwide who are currently unserved or underserved by the world’s financial sector. In addition to leveraging connections between people already on the world’s largest social network, the platform will be leveraged by many innovators -- starting with an impressive <a href="https://mashable.com/article/facebook-libra/">array of founding members</a> -- enabling people across the globe to transact and access new products securely. While this represents a huge opportunity, there’s also a responsibility to ensure that access to the platform and new financial service customers’ data and funds be safeguarded.

The value proposition of a global payment infrastructure has been recognized before, with many innovators moving into this space to launch solutions tailored to the underserved. Yet, the potential scale of Libra, through familiar and popular platforms such as WhatsApp and those of other founding companies, is a potential game changer. Libra has the potential to add a streamlined payment feature in millions of people’s phones – without even requiring that they download a new app.

At the <a href="http://smartcampaign.org/">Smart Campaign</a>, we’re enthusiastic about the potential for partnerships and innovations through Libra, which will be governed by the independent, non-profit Libra Association. Vulnerable unbanked and underbanked populations still face challenges to access high-quality and trustworthy products. Libra will allow a wide range of innovators to develop creative solutions, backed by secure technology.

Ensuring the privacy and security of client data is at the core of building lasting trust in a digital world. Providers can strengthen their privacy and security practices by having:
<ul>
 	<li>Sound data collection and storage policies</li>
 	<li>Clear guidelines about when and with whom to share data</li>
 	<li>Informed consumers who have meaningful choices in regard to the handling of their data</li>
 	<li>Systems to detect and respond to fraud</li>
</ul>
Those are a few of the safeguards that the Smart Campaign promotes with providers and is helping providers to implement. Together, we can ensure that the products and services that are developed to use the Libra platform create trust and value for both providers and customers.

The <a href="https://www.smartcampaign.org/about/smart-microfinance-and-the-client-protection-principles">Client Protection Principles</a>, which form the cornerstone of the Smart Campaign’s work, provide a framework to anticipate and evaluate the consumer risks introduced by blockchain innovations. We look forward to working with innovators in the Libra community, as we have with our <a href="https://www.smartcampaign.org/about/fintech-protects-community-of-practice">Fintech Protects Community of Practice</a>. Similar to our work with Fintech Protects, we hope to promote greater awareness and consensus among Libra innovators on consumer risks in digital financial services and how to mitigate them.
<blockquote>We hope to promote greater awareness and consensus among Libra innovators on consumer risks in digital financial services and how to mitigate them.</blockquote>
There will be adoption challenges for any cryptocurrency among low-income consumers. Over a decade of learning about the needs of this customer segment has shown us that appropriate product design requires a feedback loop between consumers and those developing the products. We know that payments can be an on ramp to access, but that <a href="https://www.centerforfinancialinclusion.org/financial-inclusion-hype-vs-reality-deconstructing-the-2017-findex-results/">does not guarantee consumers will make meaningful use</a> of other core financial services, such as credit, savings, or insurance. Thinking through the last mile use cases for Libra, including cash out points and merchant transactions, will be key, as will anticipating the risks that can damage consumer trust. Our goal is to ensure that new financial products aren’t just exciting new innovations, but that they actually deliver quality, appropriate, fair and trusted services.

Libra: With Opportunity Comes Responsibility to Safeguard

The use of algorithms to automate credit decisions, detect fraud, measure risk, and provide customer support has become widespread in the financial sector and is increasingly common in the financial inclusion industry. Artificial intelligence holds immense promise to develop and distribute financial products for previously underserved, low-income consumers by reducing costs and increasing efficiencies and scale.

Yet concerns about the fairness of machine learning systems and algorithmic bias are warranted. Technological systems can inherit the biases of the society where they are developed, through historically available data, training data selection, and choice of machine learning techniques.
<ul>
 	<li>Algorithms are not designed to be interpretable or explainable, and are treated as trade secrets that are, often rightly, protected from calls for full transparency.</li>
 	<li>Consumers are either unaware that they are the subject of an automated decision or they lack redressal.</li>
 	<li>Government oversight is lacking.</li>
</ul>
As algorithms, machine learning, and other data analytics are deployed in developing countries, many of these risks are exacerbated due to data limitations and lower levels of digital literacy. Yet, the solution is not to halt innovation, but rather to set up thoughtful oversight measures that align with the technical development process and allow for interpretability of results by policymakers down the road.

The <a href="https://www.centerforfinancialinclusion.org/about/what-we-do/the-smart-campaign" target="_blank" rel="noopener noreferrer">Smart Campaign</a> has proposed what this oversight process could look like for individual financial service providers in the <a href="https://www.centerforfinancialinclusion.org/help-us-shape-standards-for-responsible-digital-lending">Draft Standards for Digital Credit</a>. Other industries relying on AI and machine learning have begun to develop guidelines and technical capabilities to audit algorithms for bias and discrimination. This webinar will bring together experts with backgrounds in policy, data science, and financial inclusion to discuss the risks to consumers and emerging mitigation strategies (or theories) that can help ensure trust in digital financial services.
<h4></h4>
&nbsp;

Algorithmic Governance and Accountability Webinar

<a href="http://about/what-we-do/the-smart-campaign/">The Smart Campaign</a>, in collaboration with <a href="http://www.sptf.info/">The Social Performance Task Force (SPTF)</a>, invites you to attend <strong>Inclusive Digital Future: A Summit on Responsible Finance</strong> <strong>in Action</strong> taking place in <strong>Nairobi, Kenya</strong> from <strong>June 25th to 27th, 2019</strong>.
<blockquote>How do we promote inclusion and trust in digital financial services while fostering innovation and growth?</blockquote>
Over the course of this three-day international forum—organized in partnership with <a href="https://www.microsave.net/">MSC</a> (MicroSave Consulting) and <a href="https://www.ada-microfinance.org/en/our-projects/fintech-digital-finance">ADA</a>— we will confront the most pressing financial inclusion question of the day: How do we promote inclusion and trust in digital financial services while fostering innovation and growth?

The gathering will bring together financial service providers, regulators, investors, and DFS experts for two days of trainings, panels, and interactive breakout discussions, capped off by a field visit to leading Kenyan institutions engaged in digital transformation.
<ul>
 	<li><strong>Day 1: </strong>An interactive training on how to create a digitalization strategy that includes social goals (led by MSC) and workshops introducing the fundamentals of responsible inclusive finance and regulatory approaches to consumer protection in the digital era.</li>
 	<li><strong>Day 2: </strong>A full day of plenary discussion and breakout sessions on responsible digital finance in action, identifying practical ways stakeholders can advance inclusion and foster consumer confidence in digital products.</li>
 	<li><strong>Day 3: </strong>Join us on local site visits to interact with and learn from Kenyan institutions that serve as models for inclusive digital transformation.</li>
</ul>
More information, including detailed agenda, registration and travel/logistics details are available on SPTF's <a href="https://sptf.info/annual-meetings/2019-summit-inclusive-digital-future">Inclusive Digital Future page</a>.

<em>This event is supported by Mastercard Foundation and the Government of Luxembourg.</em>

Inclusive Digital Future: A Summit on Responsible Finance in Action

What technology can out-compete smartphones in getting attention of people in low-income countries? Radio.

Radio may not get a lot of fanfare, but it's still a hugely influential source of information in developing countries like Ghana. That’s why the Smart Campaign decided to use radio to help make Ghanaians more savvy consumers of financial services.

In Ghana, just over a quarter of the population has <a href="http://www.internetlivestats.com/internet-users/ghana/">internet access at home</a>. Smartphone penetration in Ghana is between <a href="https://www.pewglobal.org/2018/06/19/2-smartphone-ownership-on-the-rise-in-emerging-economies/">27 and 35 percent</a>, much lower than in more affluent countries (the US is at 77 percent, Columbia at 56 percent). And more than half of those who can connect do so at 2G speeds, with intermittent connectivity and often on feature phones, none of which is ideal for streaming high-impact content. Moreover, a quarter of the population are not literate and so do not consume print messages. For many people, the old standby – a battery-powered or hand-crank radio – remains the more reliable and practical option for staying informed.

With this in mind, the Smart Campaign launched #YouDeserveToKnow, a 16-week radio campaign in Ghana to raise awareness about consumer protection in financial services. Designed to inform while entertain, each episode starts with a short dramatic story on a theme important to Ghanaian consumers, like fraud or transparency. After the drama, a free-flowing discussion between the host and an expert commentator underscores the main messages.
<blockquote>The Smart Campaign launched this radio campaign to raise awareness about consumer protection in financial services.</blockquote>
Actually, the campaign reflects today’s environment where digital and traditional forms of communication are both present. Because many radio listeners have feature or basic phones, the #YouDeserveToKnow campaign sends approximately 10,000 users SMS messages weekly, asking users to tune in.

And for those who use digital media, animated public service announcements in Twi – the most widely spoken language in the country – with English subtitles, ideal for sharing on social media – are broadcast on CFI and Smart Campaign’s Twitter feeds (<a href="https://twitter.com/CFI_Accion">@CFI_Accion</a>, <a href="https://twitter.com/SmartCampaign_">@SmartCampaign_</a>) and Facebook pages. Three animated shorts have been shared on social media so far: one on fraud, one on transparency, and one on responsible borrowing.

In one episode, a young couple are at home when the woman receives a text message stating that she won 1 million Ghanaian <em>cedis</em>, and all they have to do is reply with their bank account information. The couple are very excited, but – spoiler alert – they soon realize it’s fraud. In another episode, a young man hastily signs on for a loan with and 80 percent interest rate. Later on, he’s shocked that his payments are hardly making a dent in his principal. The dramatic impact may not rival Game of Thrones, but the messages are likely to be much more useful.

The third short, “Responsible Borrowing,” is intended as much for bank professionals as clients. It depicts a client going to a loan at a local bank, where he’s pleasantly surprised to find client-centric staff who explain interest and repayments, ask him to take the loan agreement home to read carefully, and “make sure nobody pressures” the borrower to take the loan.

The campaign was created in partnership with the <a href="http://www.fiforumafrica.org/about/">Financial Inclusion Forum Africa</a>, a Ghanaian-based capacity building and knowledge sharing organization that promotes financial inclusion across the continent.

The episodes are airing in Ghana on <a href="https://radio.com.gh/adom-fm/">Adom 106.3 FM</a> in Twi and <a href="https://radio.com.gh/citi-fm/">Citi FM</a>, 97.3, in English. In addition, in the last week of the campaign, a trivia contest will be held for those who have access to the radio stations’ Facebook pages.
<h2>Promising Early Listener Numbers</h2>
The campaign has <a href="https://citinewsroom.com/2019/02/26/global-consumer-advocate-launches-youdeservetoknow-campaign/">received attention</a> from the Ghanaian national media. Early listener numbers have shown that the campaign to have wide reach. In the past week, the estimated combined audience for the program on CitiFM and Adom was more than 500,000 listeners. On social media, the campaign has on average reached upwards of 30,000 Ghanaians with each animated short. The series may be picked up by other stations in the future, and the Smart Campaign is planning similar series in Benin and Uganda.

&nbsp;

Radio to the Rescue in Ghana: Building Awareness of Consumer Rights

Smart Campaign Director <a href="/bio/alexandra-rizzi">Alex Rizzi</a> will speak on a a panel entitled "Banking of the Future" that will explore how financial service providers, regulators and consumer groups work can together to ensure fintech supports inclusive access, choice and innovation, whilst raising standards and maintaining high levels of consumer protection.