Demonstrating the impact of client-centric microfinance

At BRAC, achieving impact at scale is our only bottom line. In the five decades since inception, BRAC’s microfinance programme in Bangladesh has grown to serve 6.5 million clients (8.1 million including savers). Ninety percent of these clients are women. Outside Bangladesh, we have built strong microfinance entities in six countries across Africa and Southeast Asia, serving more than 650,000 clients, of whom 96% are women. In the next five years, we anticipate growing our client base by more than one million in Bangladesh, and by another million in Africa and Southeast Asia regions. Through this, we aim to touch more than 40 million lives in the process.

DOWNLOAD BRAC MICROFINANCE IMPACT REPORT, 2020

We recognise that growing in numbers does not automatically translate to greater client-level impact, such as increased resilience or quality of life. So how do we leverage our ambitious growth agenda to deliver a measurable impact in the lives of the millions of clients we serve today and the millions more we aim to serve?

In developing our strategy for growth and impact, we first re-committed ourselves to ensuring robust social performance management, including adherence to the Client Protection Principles. We have been implementing the Universal Standards for Social Performance Management to institute a consistent means of tracking and monitoring our microfinance entities’ practices, policies, and systems for continuous improvement to achieve our mission. In 2019, we concluded baseline impact surveys in partnership with 60 Decibels using a mobile-based client surveying methodology known as Lean Data^SM. Leveraging these surveys, we created an impact framework to better understand our clients and measure achievement of desired client outcomes and impact in line with our mission. In the context of mounting uncertainties due to the COVID-19 pandemic, we remained committed to listening to our clients and conducted the second set of annual impact surveys in 2020.

In the past two years, we have heard from over 5,000 clients across seven countries in 10 languages. We now know that we are reaching underserved populations (77% of respondents could not find a better alternative) and that our services do make an impact in our clients’ lives (over 85% said their quality of life had either very much or slightly improved). Together with social performance management activities, these phone-based perception surveys are now part of our ongoing efforts to keep ourselves accountable to the impact bottom line.

This report – ‘Demonstrating the impact of client-centric microfinance’ – gives an overview of the results from the client surveys and also presents our approach to measurement and management of client-level outcomes and impact. The results give us confidence that client-centric, gender-smart microfinance remains a critical tool for people living in poverty, particularly women, to improve their quality of life and strengthen their resilience, even in the face of a crisis. This report also demonstrates that measuring and managing client outcomes need not be too costly nor too difficult to achieve, and that it is possible to put the voices of clients at the forefront of every strategic activity.

BRAC has long been a strong advocate of financial services as one of the key tools to empower people living in poverty to improve their lives. It is thus important for us to build our understanding of whether and how we are delivering on the promise of achieving client impact. We are inspired by the evidence of the success of our impact-focused approach in generating positive outcomes in our clients’ lives. We encourage our peers and capital providers to put resources towards building a system where we measure what truly matters to our clients, and make management and investment decisions that enhance not only the financial sustainability of our institutions but, more importantly, the impact we have on our clients.

Watch the recording of the webinar from the launch of our impact report.

For any queries please email: info.bimf@brac.net

Upoma Husain is a Senior Manager, Client Impact and Product at BRAC International Microfinance.