2009 Russian Micro finance Center Conference “Microfinance Investors & Client Protection: New Standards”

1. 2009 Russian Micro finance Center Conference“Microfinance Investors & Client Protection: New Standards” Moscow, Russia November 19th, 2009 Symbiotics SAJerome Savelli Regional Manager Europe and Asia Symbiotics SA | 75, rue de Lyon · 1203 Geneva Switzerland |www.symbiotics.ch

2. 1. Symbiotics acts as intermediary between MFIs and investors MFIs: > 500 visited > 300 registered > 110 financed 97 outstanding > 554 investments Market research MFI due diligence Investment services Portfolio management Structured finance 30 specialized staff Geneva/Mexico/Singapore MIVs 15+ MIVs Their investors, managers, agent banks, administrators and auditors > USD 570 million disbursed

3. 2. Investors’ need to manage and report on Social Responsibility • Investors need to fulfill their social mission and report on it • Generating high positive social impacts • Raising money from the SRI market, looking for a social return • Creating sustainable partnerships with socially responsible MFIs • Using microfinance as a tool to invest in social and “green” sectors (high potential markets: renewable energy, water, etc.) • Social Responsibility part of the institution’s credit risk Credit Risk Analysis Governance Social Responsibility Market Strategy IT & Controls Finance

4. 3. Symbiotics’ Social Rating Tool Global Reporting Initiative MIX SP Report and industry standards Symbiotics expertise Symbiotics’ Social Responsibility Rating Symbiotics Social Responsibility Index Strong social responsibility

5. 4. Client Protection assessment at Symbiotics • Prevention of over indebtedness • In depth analysis of clients repayment capacity • Analysis of clients' indebtedness level • Participation to a credit bureau or information sharing initiatives • Delinquency level • Share of consumer loans vs. total portfolio • Transparency of products and conditions • Transparency of products' terms and conditions • Financial literacy to clients (trainings…) • Ethical staff behavior • Mechanisms for complaints and problem resolution • Overall quality of the relationship with clients (flexibility, mutual understanding…) • Compliance with regulations and voluntary codes regarding consumer protection

6. 5. Our belief and challenges • The overall objective of client protection and more generally social responsibility assessment is to build a sustainable microfinance industry, generating a high positive social impact on all its stakeholders while taking into account their respective needs • Measurement of the client protection is increasingly important, especially in the context of financial crisis Few challenges… • CGAP’s Implementing the Client Protection Principles : “It is harder for an investor on its own to change behaviors in a market; the roles of networks and policy makers are also important” • CGAP’s Implementing the Client Protection Principles : “How should an investor respond in a market where none of the MFIs is transparent? Should they decide not to invest, or invest while engaging with partners to improve practice?”