Business News Americas
October 23, 2009

Making microfinance client protection an essential component of fulfilling the industry's double bottom line promise is vital to maintaining the health of the microfinance industry, executives from global organizations concluded at briefings held in Washington.

Microfinance has become one of the fastest-growing sectors in the global economy in the past five years, with an estimated $5USbn of cross-border investment flowing from the developed world into microfinance institutions worldwide. But the subprime meltdown in the United States that led to the global financial crisis has emphasized the importance of accountability, security and transparency in financial services.

The meetings were organized by The Smart Campaign, a global initiative spearheaded by microfinance leaders from around the world. Among the speakers were Pilar Ramírez, president of the board of the Corporación de Fomento a Iniciativas Economicas (CONFIE) in Latin America, Kurt Koenigsfest, CEO of BancoSol in Bolivia and Elizabeth Littlefield of CGAP (Consultative Group to Assist the Poor) at the World Bank, as well as speakers from Indian microfinance entities.

"History shows that microfinance can improve the lives of millions, and reinvigorate economic activity when it is needed most," said CONFIE's Ramírez in a statement released by The Smart Campaign. "This convening is the first of what we hope is a long-term dialogue between microfinance leaders on why protecting clients is so important to the overall sustainability of microfinance."

Since the Smart Campaign was launched at the Clinton Global Initiative in September 2008, it has garnered the support of more than 700 microfinance institutions, networks and associations, as well as investors and donors who have committed to ensuring good client protection practices are an integral part of the industry.

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