We were in Amman, Jordan last week supporting Women’s World Banking’s 2013 Global Forum: Building Women-Focused Finance: The Global-Local Experience. Our first day began with a visit to the Amman headquarters of Microfund for Women (MFW), a Women’s World Banking network member and our gracious local host for the week.
General Manager Muna Sukhtian spoke to us about MFW’s commitment to their more than 100,000 clients across Jordan. She said: “We pledge to wholly embrace our beneficiaries.” Perhaps in the Middle East region more than any other, women truly depend on this kind of “embrace” from a financial institution. And we were about to get a firsthand look at some of the cultural challenges that microfinance institutions (MFIs) in this region face.
From Amman, we traveled with a group of Women’s World Banking staff and global network members to the city of Jerash, nicknamed “the city of 1000 columns” due to the carefully-preserved remnants of the Roman Empire speckled throughout. First, we visited an MFW branch and met Branch Manager Shahinaz Sager and her staff who welcomed us with tea and manaqish, a traditional Jordanian bread topped with all kinds of delicious things. This of course made us all fast friends.
Shahinaz spoke with great pride about her branch, which services about 1,200 men and women clients with individual loans, group lending products called “Solidarity” loans as well as “Caregiver,” Jordan’s first private health microinsurance offering designed specifically for maternal health. As we chatted, MFW clients came in and out of the branch, mostly women with their children, to collect their loan checks and consult with the loan officers. It was a lively and welcoming atmosphere where clients clearly felt comfortable bringing their families and the staff buzzed around us to help them.
From there, Shahinaz escorted us to visit one of their most successful clients, Tamamabu “Omgehad” Lbad, a local yogurt producer. Omgehad welcomed us into her shop and handed out generous helpings of delicious sheep’s milk yogurt. She has been operating her business since 2006, and MFW provides her with individual loans to maintain and grow her thriving business where she has also expanded into other products such as olives and pickled goods. What we found interesting, however, was Omgehad’s explanation of how exactly she has used her loans. Instead of focusing on what she has accomplished, she listed what more is left to do. She wants to do a few repairs to her building and buy another refrigerator in order to get up to code and become a regulated business.
Later, Shahinaz and Amir Nafie, the Internal Audit Manager of Women’s World Banking’s network member LEAD Foundation in Egypt, explained to us that this mindset is quite common among both men and women clients in the Middle East. When dealing with loan officers, clients de-emphasize their successes in favor of their needs. In essence, clients are afraid the MFI will cease loans or other services if they graduate to a higher standard of living or success. This is challenging for institutions like MFW and LEAD, which have missions to continually improve the livelihoods of clients in order to access larger loans and other financial services.
This tendency for clients to underreport successes makes it difficult to pinpoint the direct impact of a loan and nearly impossible to monitor a product’s impact on the clients’ quality of life. So, institutions must take a different approach to serving their clientele. According to Amir, LEAD identifies its impact, even when clients are only reporting their continuing needs, by offering a diverse basket of products targeting multiple client needs throughout their lifecycle. Providing business and education loans, access to insurance for all family members, and other products and services translate into very real and visible improvements in the client’s life – a successful approach in line with the core of an MFI’s mission.
Beyond this lifecycle approach, we also see an opportunity for MFIs like LEAD to assess how much each product (loans, insurance, etc.) impacts their clients in a more quantifiable way, especially in an environment where clients tend to underreport successes. Amir’s organization is exploring this area, and we discussed the challenge of measuring the impact of one specific loan, for example, while remaining distinct from the other products used by the client. The second challenge lies in the amount of time and frequency needed to collect the data.
These challenges put additional burden on the institution in terms of money, staff time, and other resources like a database system to hold all of the client impact information. However, we all agreed that the value of knowing just how well a product is meeting the needs of your clients far outweighs those costs. Women’s World Banking launched the Gender Performance Initiative in 2011 to help MFIs evaluate how effectively they are serving women, both as clients and staff. We left Omgehad’s shop with a challenge to continue developing effective and manageable ways for our global network to measure client success. The core of Women’s World Banking’s mission is to serve clients well, and measuring impact is one way we could serve clients better and truly – as Muna put it that morning – embrace our beneficiaries.