1. Measuring the impact of EU microfinance – Lessons from the field Karl Dayson and Pål Vik Community Finance Solutions University of Salford June 24, 2010

2. International microfinance impact studies Largest body peer-reviewed literature on microfinance Despite considerable disagreement, convergence around 3 principles 1.Large-scale 2.Longitudinal 3.Experimental or quasi-experimental

3. UK microfinance impact assessment Conducted a microfinance impact assessment of four UK MFIs Large-scale, longitudinal and quasi- experimental Focused on personal and business lending Personal loan clients: two-wave survey, control group and control location Business loan clients: one-off survey and in- depth case studies

4. Generating large sample Allow for complex analysis and inference Survey participants by wave Business clients Personal loan clientsNon-clients Respondents wave 124205173 Respondents wave 2…6281 Problematic getting sufficiently large samples –Small microfinance client base (population) –Small MFIs & sampling frames –Low response rates

5. Achieving scale in EU15 Size of microfinance sector by continent AfricaAsiaEECALACEU-15 Clients9,400,00051,400,0003,000,00012,900,00027,000 MFIs46753538040378 Clients per MFI 20,12896,0757,89532,010346

6. Achieving longitudinal surveys High attrition rates –Inability to establish rapport –Inability to establish contact –Refusal to participate Survey participants by wave MFI1MFI2MFI3Control Total respondents wave 11196224173 Total respondents wave 2 4112 9 81 Differential 785015 92 Attrition rate (%) 66816353

7. Isolating the impact of microfinance Quasi-experimental or experimental For personal loan clients had unique (in the UK) control location For business loan clients in EU15 many challenges conventional control groups –Using non-clients: Low self-employment rates –Using pipeline-clients: Small client base –Randomised studies: impractical and unethical

8. Towards an EU paradigm? International consensus a poor fit? –Small-scale, “noise” in form of govt interventions Implications for MF impact assessments in EU15 –Cross-country studies to achieve scale –Qualitative methods –No perfect fit –Question of audience

9. Thank you! Findings of study to be presented at drinks reception tomorrow eve 6:15- 7:30 at CDFA conference Full report available at www.communityfinance.salford.ac.uk www.communityfinance.salford.ac.uk