Self-Assessment in collaboration with Truelift moves a Cambodian microfinance institution toward major improvement of its Pro-Poor Social Performance

by Julie Josquin, Truelift Program Associate

Chamroeun Microfinance Limited is a microfinance institution operating in Cambodia since early 2006. In August 2014, Chamroeun was recognized as a Truelift Aspirant.  Then the organization took a step further by inviting a third-party verification of their self-assessment of their pro-poor performance, which led to recognition in May 2015 as having achieved the Truelift Emerging Practitioner Milestone. That recognition also came with advice from the Truelift Microfinance Technical Review Committee and secretariat regarding how Chamroeun could make further progress along the Truelift Pro-Poor Pathway.  Almost a year later, we checked in with Chamroeun to see how well they have been able to translate this advice into new progress.

In August 2014, Chamroeun established a new Social Performance Management Framework for the institution.  Since then, this framework has been implemented at the different management levels and branches of the institution. The SPM Framework has established a clear definition of Chamroeun’s target population as “Families/households who are living under NPL [National Poverty Line] and households living on less than $1.25 per day” (Chamroeun Social Performance Management Framework, August 2014).  Having a clear definition of the target population is very important for a pro-poor institution to achieve its social mission. The SPM Framework also defined clearly how the responsibilities for pro-poor Social Performance Management are shared by both the staff and the Board.  These responsibilities include clear reporting from client satisfaction/exit survey work, social performance rating, etc.  There is clarity regarding the persons responsible for each report, the purpose and frequency of reporting, and the key stakeholders to whom each report is directed.

This framework aims to help the Chamroeun Board of Directors to be clearly involved in pursuit of its pro-poor mission.  Moreover, in September 2015, Chamroeun introduced a tool for the Board to self-assess its commitment to the stated social goals. Staff participation in pro-poor SPM has increased and improved.  Staff is now very aware of the Chamroeun definition of poverty and the target population and their clearly defined responsibilities for SPM.  Since 2007, all loan officers are provided training in the use of the client poverty assessment tool of Chamroeun, which helps them become more involved.  The training also ensures better data collection of social information about clients and their families and other beneficiaries. This improvement in data collection is further supported by a systematic data verification system, which is described in each report. Regarding the analysis of such data, indicators of quality of life of beneficiaries will soon be benchmarked to the national statistics and poverty data by implementation of the Progress out of Poverty Index (PPI). Benchmarking allows Chamroeun to monitor its effectiveness in reaching its target population and thus achieving its social objectives.

The Chamroeun services and products were already well adapted, according to Truelift criteria. They are constantly improving with the help of very detailed client satisfaction reports.  Exit reports are also very valuable, because they not only identify the reasons clients are leaving but also which types of client are more likely to leave. Following Truelift recognition, Chamroeun was motivated to include new questions in its satisfaction surveys regarding non-financial services; also insurance services in partnership with Prévoir (Kampuchea) Micro Life Insurance Plc.

Finally, the SPM Framework defines a clear Theory of Change linking each social objective derived from Chamroeun’s mission to observable, measurable indicators.

As Lim Sotheary, the Social Performance Manager of Chamroeun, explains, the Truelift Self-Assessment Tool and third-party verification process were instrumental in clarifying their social mission. Using the Tool helped them verify that they were truly serving people living in poverty. Moreover, the experience improved communication between colleagues at Chamroeun since they had to review each other’s standards of practice in order to respond to each indicator. Chamroeun is now implementing a plan for improvement derived from the self-assessment and feedbacks.

All of these steps forward by Chamroeun resulted from the recommitment of their leaders to true achievement of their pro-poor social objectives, thanks to collaboration with Truelift for self-assessment, expert validation and advice in response to their self-assessment, public recognition of Chamroeun’s progress along the Pro-Poor Pathway, and clarity about progress yet to be made in order to achieve even better pro-poor social performance.

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