Tracking the Business Case of Consumer Protection

Consumer Protection Action Research

A consumer protection dialogue among MFIs and support organizations was organized by the Microfinance Council of the Philippines last March 13, 2009 in Pasig City. The initiative aimed to discuss consumer protection practices on the ground and to bring the participants up to date on the Beyond Codes Project, a global action research led by Accion International’s Center for Financial Inclusion with MCPI as its local partner.

Mr. Eduardo Jimenez of the Bangko Sentral ng Pilipinas (BSP) updated the participants on the progress of the BSP’s Inclusive Financial Advocacy Staff (IFAS) initiatives on consumer protection and financial literacy.

Ms. Heather Clark, Lead Consultant for the Beyond Codes Project, discussed with the participants the six (6) principles of consumer protection. They are: preventing client over-indebtedness; transparent (and fair) pricing; appropriate collection practices; ethical staff behavior; mechanism for complaints and redress and; privacy and security of client data. She underscored that ethical investment and pursuit of client welfare are complementary goals in microfinance. Among the six principles, the ensuing dialogue dwelled on the prevention of over-indebtedness, appropriate collection practices and varying application of fair pricing among MFIs.

Three (3) member-MFIs pledged to participate in the Beyond Codes, a project that seeks to track the business case of consumer protection practices for MFIs in Kenya, Mexico, Bosnia and the Philippines.

Strengthening the Capacity of Emerging Networks

The Network Strengthening Program (NSP)

Strong networks provide better services to its members. In line with the Citi Network Strengthening Program (Citi-NSP), MCPI organized the Building Strong Microfinance Associations Conference in Puerto Princesa City, Palawan last March 4 to 7, 2009. SEEP Network, Citi Foundation’s partner in the Citi-NSP, facilitated an open conference among the country’s networks, regional microfinance councils and several MFIs. Kelly Hattel, SEEP Lead International Consultant and Nisha Singh, SEEP Senior Program Associate, facilitated the conference and assisted the participants in examining the sustainability of the networks they represent.

Capacity-enhancement is being advanced by donors and investors to enable the networks to provide demand-driven services to their member institutions. They are encouraged to improve their capabilities in order to further promote the growth and development of the microfinance industry in their respective countries; to strengthen their focus on providing value to members and to contribute to international innovations in the field. NSP looks into six areas of network functions: governance; operations; human resources; financial sustainability; service delivery and external relations.

MCPI was chosen as one of the 12 regional and national networks to participate in the distinguished Citi-NSP, a three-year program that aims to promote the growth and development of microfinance networks around the world by strengthening their operational, technical and financial capacities. To enhance their capacities, these networks will have access to support instruments such as high–quality technical assistance, operational support, local expert advice and peer learning opportunities.

On their part, the participating regional and national networks are expected to mirror these trainings to their member institutions through assessment sessions, program reviews and sharing of best microfinance practices.