Triple Jump in Smart Campaign

FEBRUARY 2012 – Triple Jump provides data for the Smart Campaign’s new publication on client protection practices: Implementing Client Protection in Microfinance – The State of the Practice.

The Smart Campaign, a global initiative to implement rigorous client protection standards and practices in microfinance, recently published its first annual report with a focus on the implementation of the Campaign’s core Client Protection Principles.

Triple Jump, together with three other Microfinance Investment Vehicle (MIV) managers and two microfinance rating agencies contributed the data for this report. Comprising 479 assessments at more than 300 microfinance institutes (MFIs) worldwide, this is by far the most comprehensive data yet assembled on client protection practices at MFIs.

While the results highlighted various weak points in the MFIs’ interaction with clients, they also portrayed an industry committed to treating clients with dignity and serving their needs: 88 per cent of the rated MFIs received overall pass marks (3.0 or higher on a 1–5 scale), with an average score of 3.8.

These results also applied to the two most important principles: Preventing Over-indebtedness, and Transparency. While there was relatively little overall variation by region or institution, the performance of smaller institutions was below the average, as were MFIs in Sub-Saharan Africa.

The assessment of the MFIs’ implementation of client protection principles is integral to Triple Jump’s investment process. Within our Social Performance Assessment tool – which we use to evaluate all our MFI clients – client protection is the most important dimension assessed.

We evaluate the MFIs’ practices relating to appropriate product design and delivery, prevention of over-indebtedness, transparency, responsible pricing, fair and respectful treatment of clients, privacy of client data, and mechanisms for complaint resolution.

The Smart Campaign’s report highlights how rapidly the notion of client protection is being accepted by the microfinance industry. Triple Jump is pleased to contribute to this report by providing data from its portfolio of clients. We look forward to continuing our efforts to promote strong client protection practices among the MFIs we work with.

The full report is available for download.