>Posted by Center Staff
Over the past few years, as many organizations in the microfinance industry have increased their focus on responsible and client-centered microfinance, a number of initiatives have developed to enhance the performance of MFIs along various social criteria. The Smart Campaign, Social Performance Task Force (SPTF), and Seal of Excellence in Poverty Outreach and Transformation have released a joint letter to explain how the activities and focus of each initiative differ from each other, and how they interconnect.
At the most fundamental level, all the initiatives “Start with Smart”: both SPTF and the Seal treat the Client Protection Principles of the Smart Campaign as the foundation of their work. The SPTF’s Universal Standards for Social Performance Management (USSPM) incorporate detailed client protection indicators developed by the Smart Campaign. The Seal of Excellence builds on both the Client Protection Principles and the USSPM as gating criteria. It will then go on to identify organizations that both meet client protection and social performance management standards and also make a demonstrable effort to reach very poor people and help them move out of poverty.
While each initiative operates independently, the three organizations are taking steps to coordinate their work. Each initiative is working with microfinance rating agencies to implement assessment and certification mechanisms specific to their mission. What is likely to emerge over time is an array of modules that would allow MFIs to choose the topics on which to be rated.
Read the letter here.