Impact is the change in social and economic conditions of clients or communities as a result of microfinance programs. Impact assessment seeks to establish the causality between those changes in conditions and participation in programs. Because impact assessments have to prove causal linkages over time, it often entails rigorous statistical exercises and can be very costly. Impact assessment is a specific element within the broader framework of social performance.
The Impact of Microfinance
This growing collection of studies--conducted throughout Asia, Africa, and Latin America, and organized around Millennium Development Goals--show how microfinance services have positively affected the poor (e.g., increasing incomes, reducing poverty, and advancing development goals in education, health, and women's empowerment).
The What, Why, and How of Impact Assessment
Here we explore what impact assessments are, how they are used, and why they are important.
Developing an Impact Assessment
Although many microfinance institutions (MFIs) aim to reduce poverty, few measure the impact of their services on their clients on an ongoing basis. This section leads MFIs through a step-by-step Guide to Impact Assessment and how to design and implement an assessment appropriate to their organization and mission. It also provides detailed information on the methodological issues and tools involved in an assessment.