During the last InFiNe.lu digital event, Jurgen Hammer and Anne-Laure Behaghel, SPTF (Social Performance Task Force) presented the Client Protection Pathway, a new tool for Financial Service Providers (FSPs) and social investors developed by SPTF & CERISE to ensure the commitment towards client protection standards in the microfinance sector. Apricot Wilson, LMDF (Luxembourg Microfinance & Development Fund) brought the testimony of a social investor supporting the initiatives and explained the interest for a social investor to be part of it.
Client Protection has always been an integral part of the Universal Standards and of Social Performance management in microfinance.
With the closure in 2020 of the Smart Campaign, a global initiative led by CFI to create an environment in which financial services are delivered safely and responsibly to low-income clients, social investors and FSPs expressed a strong demand to continue the work on client protection standards and evaluation. In 2020, the Client Protection Standards and the management of their implementation was transferred to SPTF & CERISE that launched in 2021 the Client Protection Pathway.
The Client Protection Pathway describes the steps that an FSP can take to improve its client protection practice and communicate its progress to its investors. It gives a roadmap to implement Client Protection Standards. By joigning and using the Client Protection Pathway, an FSP can have more public recognition of its commitment and progress towards client protection. It provides as well a clear-road map for what to do next.
For investors, donors and funders, the Client Protection Pathway helps them to identify the FSP committed into client protection. The different steps of the pathway can also be used in funding agreement to ensure the commitment into client protection.
In November 2021, Social investors, networks and associations signed a joint statement calling all FSPs to join the Client Protection Pathway and to implement client protection standards, among them the Luxembourg Microfinance and Development Fund (LMDF).
For more information on the Client Protection Pathway click here
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Picture 1 © Pallab Seth