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Measuring the Impact of Microfinance Meritxell Martinez- CGAP European Microfinance Week 29 Nov – 1 Dec. After this presentation you will: Refresh your knowledge of monitoring and evaluation Get an idea of the type of evaluations being done in microfinance
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Measuring theImpact of MicrofinanceMeritxell Martinez- CGAP European Microfinance Week 29 Nov – 1 Dec.
After this presentation you will: • Refresh your knowledge of monitoring and evaluation • Get an idea of the type of evaluations being done in microfinance • Have an update on experimental research findings
Monitoring vs. Evaluation in MF How is my program doing vis-à-vis the set goals? MONITORING (Social Performance – PPI, PAT, scorecards, MIX SP indicators) Are my clients doing better because of the program? EVALUATION
Evaluation QUALITATIVE QUANTITATIVE More selection bias Less selection bias
The problem Anecdotes IMPACT Monitoring data (Social performance indicators) ≠ ? Non or quasi -experimental studies Problems establishing attribution!
Impact evaluation using RCTs Randomized Controlled Trials (RCTs) are showing us the importance of truly understanding: • who benefits and who doesn’t and by how much • counterintuitive results • the diversity of clients RCTs are not just about impact, but the methodology can be used for market research and product testing.
What are RCTs telling us about microfinance so far? Highlights from the Microfinance Impact and Innovations Conference, Oct 21-23
Findings on credit . * 3 studies
Findings on savings . * 1 study
Findings on (rainfall) insurance . * 2 studies
Findings on financial education * 1 study
Debate • Do we understand the financial needs of the unbanked? • What else needs to be researched? Is this evidence new? • How does social performance help us understanding the impact of microfinance? • What are the “evidence needs” of 1- double bottom funders, 2- policymakers, 3- providers? • Is the reputational risk of investing in microfinance increasing?