> Posted by Amit Gupta

The first Smart Certified Assessors Training could not have happened at a more critical time, as we in the Indian microfinance industry are experiencing our worst crisis in three decades.

The epicenter of the problem is in Andhra Pradesh, the state with the maximum concentration of microfinance, or about 35% of total portfolio outstanding in India.

The key allegations levied against MFIs by Andhra Pradesh’s government are that these institutions:

1)    Charge usurious interest rates
2)    Indulge in multiple lending that over-indebts its client
3)    Use coercive practices to recover the money, leading clients, in some cases, to take measures as extreme as suicide

The Smart Certified Assessors Training organized in Bangalore this October 18th and 19th addressed all of these issues.

The primary objective of the training was to train participants in how to conduct a Client Protection (CP) assessment using The Smart Campaign principles and how to evaluate MFIs’ practice of these six principles through a detailed analysis of relevant policies, people, and practices.

Industry veteran Larry Reed, together with The Smart Campaign’s lead in India, Hema Bansal, conducted the training in a highly interactive manner. The training team engaged the participants with assessment-related role plays, puzzles, exercises, and discussions.

Participants also gained insights from the field, based on their previous assessment experiences (ratings or institutional assessment related).

The training was attended by 10 participants, most of them from networks and supporting institutions such as SIDBI, ACCESS-Assist, Maanaveeya Holdings, and EDA Rural Services.

With the successful completion of the training, participants have cleared the first stage of the certification process, making them eligible to accompany certified assessors in upcoming CP assessments.

Many participants spoke of the need for MFIs to conduct CP assessments to help MFIs overcome their current shortcomings in various CP areas, improve wherever possible, and in turn boost the Indian microfinance industry as a whole.

Ensuring that MFI concerns and relevant issues are addressed has been, and will remain, a central objective of the CP assessor trainings.