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 their standard of living. We have witnessed millions of client success stories over the years. In an effort to quantify this impact, we use research to rigorously monitor the social performance of our work to ensure we are delivering deep and meaningful impact for our microfinance clients.
To do this effectively, we seek to understand the complete customer experience. This includes the benefits our clients are receiving and the ways we may improve to better serve them. FINCA’s customer research aligns our programs with our mission, and provides useful intelligence for enhancing our work.
Who Do We Reach?
Around the world, 1.7 billion people 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 standard of living, and achieve their personal aspirations. That is the power of financial inclusion.
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 measuring 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 access to loans, savings accounts and other financial services so 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’ businesses and the wages they pay. This data tells us whether they are earning a decent living, and whether FINCA’s loans have 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 to use their income 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 towards poverty alleviation.
Finally, we ask whether our clients are getting what they want out of FINCA. In our surveys, we ask clients to describe what their personal aspirations were when they took-out a loan, and if the loan was (or will be) helpful to them in achieving their goals. 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.