Investing in Responsible Financial Inclusion – A Profile of Smart Campaign Client Protection Certified Institutions

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This post accompanies the release of Investing in Responsible Financial Inclusion – A Profile of Smart Campaign Client Protection Certified Institutionsa case study from the Partnership for Responsible Financial Inclusion as part of our project with the IFC to accelerate responsible microfinance.

Just over seven years ago, the Smart Campaign announced their intention to launch a certification process that would enable microfinance institutions (MFIs) worldwide to demonstrate their adherence to the Campaign’s core Client Protection Principles. Today, nearly 100 financial institutions have achieved the certification, more than 50% of them part of the PRFI network. Where are these institutions located? How big are they? How many clients do they serve? What external factors contribute to their success? Investing in Responsible Financial Inclusion – A Profile of Smart Campaign Client Protection Certified Institutions, seeks to answer these questions by identifying

  • The characteristics of institutions that correlate to successful completion of Smart certification
  • Environmental factors that may be positive contributors of successful client protection practices

Since its inception, the Partnership for Responsible Financial Inclusion (PRFI, formerly the Microfinance CEO Working Group) has supported the delivery of responsible financial services for low-income communities around the world. An important aspect of this work has been advocating for and supporting the work of the Smart Campaign. The PRFI has done this by encouraging both FSPs and regulators to adopt the Campaign’s Client Protection Principles – by undergoing the certification process and utilizing the Model Legal Framework for Financial Consumer Protection, respectively. Making the Client Protection Principles an industry standard is central in realizing a vision where all clients are not only included, but both clients and institutional stability are also protected.

Through its three-year Accelerating Responsible Microfinance project with the International Finance Corporation (IFC), the PRFI has been working to accelerate responsible financial services by supporting local partners within our member networks to adhere to the best practices of consumer protection. Between 2013 and July 2017, 46 local partners of PRFI networks have been certified, 52% of the total number of certified institutions. Among the PRFI network of certified FSPs are organizations that have self-financed the cost of certification, received funding from PRFI members, have been co-funded by the PRFI through the IFC grant, or those having received other third-party support.

The Profile captures data on 89 financial service providers (FSPs) which were Smart certified as of July 2017 by analyzing data from the database maintained by the PRFI on its members as part of its work supporting the Smart campaign, and from the Mix Market[1].  The research segments certified FSPs by region, asset size, client reach, PAR>30, and PRFI network vs non-network members to provide profile snapshots.

Several key findings emerged from the data:

  1. Certified FSPs tend to be large and mature institutions, with median asset size of $143 million
  2. The certification has protected 28% of overall FSP clients globally
  3. PAR>30 is low for certified FSPs
  4. Regulatory environments with enabling financial inclusion practices may contribute to lower barriers for FSPs that are seeking certification

The following provides a snapshot of the type of analysis found in the report.

While East Asia Pacific and South Asian FSPs represent 17% and 21% of the certified portfolio and are the largest and the third largest in terms of median asset size, respectively, they differ in the scale of client reach. South Asian FSPs reach three-fourths of the portfolio of certified-covered clients, while East Asia Pacific FSPs reach only 7%. This finding illustrates that FSPs from South Asia are large FSPs with an equally large reach. East Asia Pacific FSPs, on the other hand, are large and mature FSPs but with a smaller number of active borrowers.


The observations from the report are useful guidelines for the PRFI, as well as for other stakeholders in the financial inclusion industry, interested in driving the adoption of the Smart Campaign’s Client Protection Principles. We invite you to review all the findings from the case by downloading the report here.


[1] Because 2017 data is not available for most FSPs on the Mix Market, the report relies on 2013-2016 for analysis.

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