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Microfinance institutes turn focus to social performance
Lao microfinance institutes are learning to incorporate social performance into their business modeling rather than focus entirely on financial performance in order to attain long-term sustainability.
The rapid development and growth of microfinance worldwide was originally grounded in the belief that it can successfully combine social and financial objectives.
According to a press release from the Microfinance Working Group for Laos (MFWG), recent research has proven that microfinance institutes which successfully incorporate social performance are more sustainable than those who merely focus on financial performance.
The MFWG is conducting a course on ‘Social Performance Management' for managers, trainers and officials from various microfinance institutes in Laos, which runs from August 15-18 in Vientiane.
The training provides an introduction to social performance initiatives and their relevance to microfinance in Laos. It also examines social performance management frameworks and indicators, and client protection principles, which include prevention of over-indebtedness, increased transparency, responsible pricing, appropriate collection practices, ethical staff behaviour, efficient complaints handling and resolution and privacy of client data.
The training discusses how to develop appropriate products for poor clients based on demand, and presents a variety of social performance assessment and poverty measurement tools. The MFWG is also drafting its social performance strategy.
The training is being provided by experts from Plan International and the Microfinance Council of the Philippines, through further support from SEEP Global Network and ADA Luxembourg.
The training course was opened by Deputy Director of the Financial Institution Supervision Department Mr Am phone Aliyavongsing, Chair of the MFWG Mr Bandith Sisoukda, Executive Director of the Microfinance Council of Philippines Lalaine Joyas and Microfinance Programme Specialist Muhammad Awais.
The MFWG is the national microfinance industry network in Laos. It was established in May 2007 by a group of microfinance practitioners committed to sharing experiences and working together to promote a coordinated approach to sustainable microfinance that works towards international best practice principles in the country.
vientiane times
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