Where Angels Prey

Where Angels Prey is a novel by Ramesh S Arunachalam. Please refer to www.whereangelsprey.com for more information

Saturday, April 23, 2011

Social Performance Pathways and Management: What is The Guarantee That It Will Work in Decentralised (Agency) Micro-Finance Models?

Ramesh S Arunachalam

Rural Finance Practitioner


Figure 1 below gives an overview of a typical social performance pathway, and the process of SPM as articulated by expert stakeholders and I quote with adaptation from their work: “The central arrow demonstrates how an organization’s mission is translated into specific social performance objectives. Through the design of operational systems and the design and delivery of services outcomes are achieved in terms of reaching target client groups and meeting their needs. Meeting the needs of target clients leads to the desired changes relating to the social mission. Surrounding this arrow is the social performance management process. This involved monitoring and assessing progress at each stage of the arrow, and the use of information produced feed into improved practice. [i]



The above process may be clear with regard to traditional (paper) models of micro-finance but when MFIs use the agency and decentralized model, which is what is happening increasingly, at least in places like India, the last mile is not at all visible. Therefore much of what is envisaged above in Figure 1 may not be possible in Figure 2, due to the huge levels of decentralization and lack of clarity with regard to servicing the clients at the last mile


I raise several (starter) questions for SPM advocates and practitioners with regard to the decentralized model and hope they factor these into their frameworks:
ð      When center leaders or others act as agents at the last mile, how can reliable and valid information about products and processes be obtained and used in the SPM assessment?
ð      When end user clients are (themselves) not known as in many cases, what client level data can be obtained and used in the SPM process?
ð      When the monitoring for the last mile stops with the agent, what real assessments can be done with regard to various social performance objectives?
ð      When end use is unclear as in many agent led models, how can client impact be measured?

Thus, under circumstances such as the above, it would be impossible to assess aspects as the following, so critical for SPM:
ý      Who uses and who is excluded from using the MFIs services?
ý      How do the MFIs clients use the MFIs services?
ý      Do MFI services meet their client needs?
ý      Why do some clients leave or become inactive?
ý      Who benefits and how?
ý      What benefits were unexpected?
ý      And several other questions


When one considers these and other questions, the credibility of Social Performance Management, as a sub-field of micro-finance and financial inclusion is seriously at stake…I sincerely hope that the so called practitioners of SPM address real ground level issues rather than merely focus on high level concepts that can at best be called as superfluous…and perhaps even redundant…

Have A Nice Day!


[i] Social performance management in microfinance: Guidelines by Imp-Act in collaboration with Microfinance Centre, (2005)

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