India Focus Note 35: Social Performance Management in India

Social Performance Management (SPM) - putting mission into practice - is increasingly relevant to the Indian microfinance sector, which may be on the brink of a 'perfect storm': a push for high growth and expansion coupled with growing over-indebtedness of clients, increasing competition, aggressive collection practices and the entry of private equity and investors looking for returns. With so much at stake, Indian MFIs need to find a greater balance between their social and financial bottom lines. Market-led SPM can help to ensure an MFI meets its mission and manages these growing risks while improving overall performance. In sum, a market-led approach to SPM is one part "truth in advertising", one part "risk management" and one part "common business sense".

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