I arrive in Kerala in the middle of the monsoon, with days characterized by gray skies and consistent rain, heavy only at times, but invariably rainy. Kerala is situated on the country’s southwest coast. It has the highest literacy rates in the country, and while predominantly Muslim, holds the country’s largest Christian population. Kerala is a contradictory state. It produces one-third of the world’s tea and has an economy propped up by expatriate remittances from the Middle East, while also having approximately 90 percent of its indigenous population living below the national poverty line.
I am here to work with ESAF India, a microfinance institution (MFI) headquartered in Thrissur, Kerala, serving approximately 225,000 clients through 125 branches throughout India. ESAF India is the first MFI to pilot the Progress out of Poverty Index (PPI) certification process, applying standards recently developed by the Grameen Foundation Social Performance Management Center to validate the use of the PPI. The PPI is a tool developed by Grameen Foundation to measure poverty results, giving MFIs information that will allow them to ensure they are sticking to their social mission serving the poor and to develop products to meet the assortment of client needs. The standards are designed to help MFIs use the PPI correctly. They cover five areas of use:: intent, collection, process, training and reporting of poverty results.
Over the course of one week, I work closely with ESAF’s PPI Manager, Benita, and am privileged to have access to staff from the managing director to the loan officers, as well as to be introduced to several ESAF India clients. Based on my interactions, it seems to me that ESAF India is committed to meeting their clients’ needs and social goals. As the PPI contributes to both, they are in the process of implementing various processes and training to achieve best-in-class PPI use. Even more apparent is the confidence that microfinance loans and membership in a sangam has instilled in the clients. These women have gained not only financial benefits, but also greater independence, practice managing money and people, and, according to one loan officer, “social fearlessness.”
With the development of the new standards, Grameen Foundation is helping ESAF India, and all MFIs that go through the PPI certification process, to accurately measure poverty results and fulfill its social mission.
Jamie Dunchick is an associate at J.P. Morgan in New York. She traveled to India in July 2010 to work on the PPI Certification (Progress out of Poverty Index) pilot project with ESAF India in Thrissur, Kerala. Jamie's participation in this project is part of J.P. Morgan's partnership with Bankers without Borders as the program's presenting sponsor.