With the aim of establishing a better understanding of the microfinance institutions industry, The Smart Campaign has published a 41-page report which contains key findings from a qualitative and quantitative research based on input from 1,000 microfinance institutions clients across Pakistan, Benin, Peru, and Georgia.
This research identified what clients consider both problematic and good treatment by microfinance institutions , and assessed how common problems are.
The Georgia report has now been published – key findings include:
Clients are generally happy with the microfinance institutions experience and treatment
- Many clients see their relationship with MFIs as long-term and bilateral
Clients with USD loans are greatly affected by exchange rate fluctuations, and may not always be aware of exchange rate risks
- Nearly one-third of clients have USD-denominated loans
- Many of these clients did not realise that their loans would be in USD before accepting the loans, while others did not fully understand the associated risks
Some microfinance clients experience high levels of debt
- Clients receive frequent credit offers and pre-approved cards from MFOs, a MFO marketing practice to tempt clients to borrow beyond what they may require.
Also included in this report are recommendations on what the industry can do to create the incentives for a more functional financial consumer protection ecosystem.
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