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> Posted by Hema Bansal and Alexandra Rizzi, India Manager and Deputy Director, the Smart Campaign

The following post was written by Hema Bansal, with support from Alexandra Rizzi.

Over the past year and a half, while conducting several client protection assessments across India, I have often thought about what it takes for an institution to meet the Smart Campaign standards on appropriate products and delivery channels. Among its requirements, the Smart Campaign Certification standards state that providers design products that incorporate client characteristics – and needs, as well as customer feedback into new and existing product offerings.

From engaging with many financial institutions, I have seen that the product design and improvement process is influenced by multiple factors and can be quite complex. A particular challenge in India is the inertia of (and now regulatory emphasis on) the original Grameen lending methodology. While the Grameen joint-liability group methodology was the innovation that enabled millions without collateral to access small loans, its pervasiveness today can often overshadow additional products based on client characteristics and needs. The Grameen methodology has clear advantages for both the lender and the clients, particularly its scalability, but client needs often merit additional products in a lending portfolio. For example, products should have flexible payment options that adjust to clients’ economic and business cycles. Payment options should not limit themselves to mandatory weekly group meetings. They should encompass a wide array of payment periods (bi-weekly, monthly, quarterly, or semestral) and vehicles (pay loan officer, deposit at bank or partner intermediary, telephone payments, etc.) that are suitable to clients. Really the sky is the limit!

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