For over 30 years, FINCA has been providing financial services to low-income people around the world, to help them build assets, create jobs and raise standards of living. From witnessing millions of success stories from our clients over the years, we know we are making a difference. FINCA has now quantified this success. We have taken a more comprehensive, research-based approach to assess our results, specifically who we are reaching and how have their lives changed.
Who do we reach?
Two billion people around the world are completely excluded from financial services. Many others are left with limited options, which are often expensive or not suitable for their needs. FINCA intends to close this gap. When low-income people gain access to to financial services, they can generate income and employment, enhance their standing in their community and achieve their aspirations.
FINCA’s mission reporting starts with data that tells us whether we are reaching the unbanked. Beyond having a bank account or loan, we have to consider the quality, price and suitability of the services that are available. The percentage of people who have no access might just be the tip of the iceberg, but it is a good indicator of financial inclusion overall.
We also have a special interest in reaching women and people in rural areas, who are more likely to be poor and face the highest barriers to full economic participation.
In profiling our clients, we also consider the living standards in their households. This information tells us about our clients’ quality of life and their daily struggles.
In addition to access to water and electricity, we focus on housing and education, because they have a substantial influence on a family’s ability to improve their well-being over time.
Together, indicators of financial exclusion and low living standards define our target population.
What Impact Do We Have?
FINCA provides people with loans so that they can generate income and employment, both for themselves and others in their community. This is where we look for FINCA’s direct impact. We measure the profitability of our clients’ business and the wages they pay. This data tells us whether they are earning a decent living, and whether FINCA’s loan has enabled their businesses to create jobs.
Through the lens of the enterprise, we also measure FINCA’s contribution to women’s empowerment.
There are many useful indicators of women’s social and economic status, but we look at the ones that are most directly related to the services that FINCA provides. We consider a woman empowered when she is able to run a business, especially when she can hire workers.
Women are more likely to be poor and any income they earn is normally used for the care and education of their children. With this in mind, we also measure how many women are working as employees in our clients’ enterprises. These women may not be our direct clients, but play a vital role in our mission to alleviate poverty.
Finally, we ask whether our clients are getting what they want out of FINCA. In our surveys, we ask clients to describe what their main goals and aspirations were when they took out a loan, and if the loan was (or will be) helpful to them in achieving that goal. Not surprisingly, most clients are focused on growing their businesses — but they are also busy making home improvements, covering educational expenses and dealing with family emergencies.
Taken together, all this data helps us measure and manage our mission through evidence-driven strategies. We also hope it sparks a deeper reflection on the purpose and value of FINCA’s work, while providing useful insights for others who are striving for similar goals.