Assessing the Relative Poverty of Microfinance Clients: A CGAP Operational Tool
CGAP
Publication Date: 2000
Published by: Consultative Group to Assist the Poor (CGAP)
Document Type: Paper
What is the CGAP Appraisal Format and of what importance is it in microfinance assessment?
This paper explores the CGAP Appraisal Format, an operational tool for assessing the poverty levels of clients of microfinance institutions (MFIs). It says that the CGAP's Appraisal Format for Microfinance Institutions outlines a framework for assessing the likelihood that the MFI will develop into an entity capable of expanding independent of donor resources. The tool - provides guidelines and instruction for collecting survey data
- guides users in developing a sampling frame and in actually sampling of households
- outlines how to customise a standard questionnaire to fit the specific local conditions where the MFI operates
- describes the level of detail needed to successfully implement the survey
- gives guidelines for contracting the project to a qualified institution or individual
- focuses on managing and analysing data using the Statistical Program for Social Science (SPSS) software
- guides in managing the survey data once collected, including how to enter data
- explains how results of the analysis can be applied by donors to reach conclusions
The CGAP Appraisal Format contains practical guidelines and indicators for measuring MFI performance in a range of issues, including: governance, management and leadership, mission and plans, systems, operations, human resource management, products, portfolio quality, and financial analysis. It argues that analysis of these institutional features allows for an appraisal of the potential for institutional sustainability. In addition, the tool supports comparison of poverty outreach among MFIs and even across countries and the methodology is applicable to all MFIs, regardless of their location, client structure, and outreach approach
The tool was field tested through four case studies in Asia, Africa, and Latin America conducted during 1999 and the cumulative experience gained from these studies were used to standardise it.
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