1. SOCIAL PERFORMANCE MANAGEMENT Implementation Strategy for Networks _____________________________ Jordan June 5th, 2012

2. _______________________________________________________________
Introduction to MFIN
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Established in December 2009 as the Self-regulatory organization (SRO) for the Indian Microfinance industry.
MFIN currently has 46 of the leading NBFC-MFIs as its members.
The combined business of MFIN member MFIs constitutes more than 85% of the Indian microfinance sector (excluding SHGs).
As of March 2012, the combined client base of member MFIs is ~23 million and a portfolio outstanding equivalent to USD 2.8 Bn.

3. MFIN - Mission
Help provide inclusive financial services to 100 million low income households by the year 2020, in a responsible & transparent manner.

4. MFIN & Social Performance Management
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Synergy with MFIN’s mission and objectives:
Transparency
Client Protection
Responsible and inclusive financial services for the un-served and underserved
Robust development of Microfinance sector
Political and regulatory risk management

5. SPM & Microfinance in India
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Emerging Risks within the Industry
Reputation risk
Regulatory risk
Political risk
Growing evidence of the positive implications of Social Performance
Differentiation in funding market
Better clients retention & portfolio risk management

6. GAP ANALYSIS – KEY FINDINGS
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41% of member MFIs have conducted social audits and 36% have conducted social ratings.
Inadequate emphasis by funders and investors cited as one of the primary reasons for not undergoing social performance assessments
Only 33% of member MFIs have conducted CPP assessments.
Staff Incentives not aligned with SPM.
50% of member MFIs use some poverty indicator to track the poverty profile of clients and assess their movement out of poverty.
78% of member MFIs report social data to MIX Market.
A whopping 94% of member MFIs conduct some financial literacy or financial education programme.
67% of members offer Microfinance “PLUS” services such as health camps, support for tuition of clients’ children, livelihoods training etc.

7. CHALLENGES & LESSONS LEARNT SO FAR
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SPM v/s CSR
The business case for SPM - prioritizing SPM in a challenging business environment
Implementation of new processes and guidelines in a changing regulatory environment
Consensus building on SPM benchmarks among MFIs and stakeholders

8. STRATEGY FOR IMPLEMENTATION & THE WAY FORWARD
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Buy-in of MFIN Board and member MFIs
Educating funders, investors, and other stakeholders on relevance of SPM and SP metrics
Differentiation through social performance transparency – MFIN Score Card
Identification of relevant partners – SMART Campaign
MFIN guidelines for corporate governance
Endorsement of PPI
Partnership with MIX & MFTransparency
Creating platform for partnerships with livelihood development programs

9. Thank You !