Transparent Pricing Initiative in Ghana February 2013 MicroFinance Transparency Promoting Transparent Pricing in the Microfinance Industry
	We are pleased to announce the commencement of this year’s Transparent Pricing Initiative in Ghana  The Initiative promotes consumer protection in the microfinance industry by facilitating responsible and transparent pricing. Participants in the Initiative publicly disclose their standardized microloan prices on the MFTransparency website. Microfinance Institutions in Ghana are invited to join the Transparent Pricing Initiative by becoming transparent in their pricing, thereby proving their commitment to consumer protection, social performance and responsible microfinance. Participating in the Initiative requires the completion of an excel-based questionnaire and the submission of client loan documentation as evidence. The participation process has been designed to take a minimum amount of time – typically less than 2 hours of a senior staff member’s time. We do not charge for this service but deliver the opportunity for you to adhere to this essential industry standard at no cost. The Initiative is delivered by MFTransparency in partnership with Planet Rating, support from GHAMFIN and funding from the MasterCard Foundation. All institutions participating in this Initiative receive the Seal of Transparency – an internationally recognized certification as a transparent microfinance institution. Gain recognition for your organization by promoting responsible microfinance – become a member of the Transparent Pricing Initiative in Ghana.  Please view our website for more information:  Click here to read about the benefits of participation Click here to view the transparent pricing data from last year’s Initiative Click here to sign up, or email ghana@mftransparency.org MFTransparency represents an industry movement toward transparent practices and responsible microfinance. We have organized transparent pricing efforts in nearly 30 countries on four continents, working with over 500 microfinance institutions. Publicly disclosing the prices that borrowers pay for microloan products is now the standard, and expectation, of the microfinance industry. Join the other microfinance institutions in Ghana who have already become transparent. Please send any questions or your interest in participation to ghana@mftransparency.org - we look forwards to hearing from you!
	MicroFinance TransparencyEmail: info@mftransparency.org

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Developing useful tools and processes to improve financial education and consumer protection in the microfinance sector is fundamental to MFTransparency’s strategy. We believe it is imperative for the health of the market for consumers to be educated and informed on the services and products they have access to.

As part of MFTransparency’s enabling APR & EIR Program, financial education experts have developed a universal pricing education package, aimed at consumers of microloans. Using proven financial education models and lessons learned from other countries, these resources have been developed to be tailorable, aknowledging the diversity of Africa’s communities.

MFTransparency is pleased to share this consumer pricing education package. These materials may be reproduced, translated or adapted with minor changes to meet local needs, provided that they are distributed for free or not for profit and provided any changes maintain the integrity of the book. Please inform us of plans to adapt or translate these materials, provide us with a copy of the adapted publication, and ensure recognition of MFTransparency and MasterCard Foundation.

Please inform us of plans to adapt or translate these materials, provide us with a copy of the adapted publication, and ensure recognition of MFTransparency and MasterCard Foundation. Please contact us with any questions or comments you have!

From the blog:

• Shaping the Path in Financial Literacy, click here.
• Learning the Client Perspectives on Pricing: Insights from the Field, click here.
• Financial Education: From Russia to Rwanda, click here.
• Financial Education: Key Component to Responsible Pricing, click here.

The enabling APR & EIR Program is sponsored by the MasterCard Foundation. The Progam has worked to promote improved consumer protection principles through microfinance product pricing transparency. Through the enabling APR & EIR Program, MFTransparency has raised awareness of transparent pricing issues in seven countries in Africa –  Malawi, Uganda, Rwanda, Ghana, Tanzania, Zambia and Mozambique.

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• Ghana Country Survey
• Malawi Country Survey
• Mozambique Country Survey
• Rwanda Country Survey
• Tanzania Country Survey
• Uganda Country Survey
• Zambia Country Survey

Across the globe no two microfinance industries are the same. Each is uniquely influenced by the national socio-economic climate within which it operates. Transparent pricing data gathered by MFTransparency clearly illustrates how the practice of microfinance in a country can differ vastly from those of its neighbors.  A key feature of MFTransparency’s research is the division of product pricing data by country, recognizing that national factors affecting the pricing of microloans make the fair comparison of products between countries difficult.

Many factors are responsible for the international variations between microfinance industries, including differences in regulation, the cost of funds, level of competition, financial inclusion, operating costs and the broader economic and political framework of the country. These create a unique set of circumstances in each country, governing the origins, present state and future development of its microfinance market.

For each of the countries in which MFTransparency works a thorough review is conducted, known as a Country Survey, outlining these national socio-economic, political and historic factors. Summarizing the country specific context, Country Surveys form a valuable backdrop against which to examine a market’s pricing data.

MFTransparency is pleased to share the Country Surveys for the microfinance markets involved in the enabling APR and EIR Program - an initiative sponsorred by the MasterCard Foundation. The Country Surveys were prepared by a team of talented interns working for MFTransparency, and should be viewed as a resource offering general contextual information for the Transparent Pricing Initiative in each country. 

MFTransparency is the leading provider of educational materials on pricing in the microfinance industry.

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In this workshop MFTransparency provided training on pricing transparency to a range of local industry stakeholders including microfinance institutions, regulators, funders and other support organizations.

The main objective of the enabling APR & EIR Program is to promote improved consumer protection principles through microfinance product pricing transparency. At the launch workshop MFTransparency presented on various topics including the implementation of pricing transparency in the Mozambican microfinance industry, and consumer protection, consumer education and financial literacy.

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Financial education, financial literacy, and financial capabilities are hot topics in development today. They have the attention of donors and of governments all over Africa – and all over the world. Financial education is also a key activity in MFTransparency’s enabling APR & EIR Program.

The financial education component of the enabling APR & EIR Program will be piloted in two countries: Rwanda and Malawi. In Rwanda, we are relying on support from the Association of Microfinance Institutions of Rwanda (AMIR) while our partner in Malawi is the Malawi Microfinance Network (MAMN). Both networks are strong advocates of pricing transparency and are proponents of financial education programs. With the support of these networks, we are conducting a needs assessment in June and July of this year.

The development of the financial education component of the enabling APR & EIR Program brings to light several opportunities, as well as a number of challenges. As we work together with AMIR and MAMN, we will be documenting each success and lesson learned. Hopefully our experience will produce a well-contextualized and targeted program, as well as contribute to the wider discussion on financial education, literacy and capabilities. Furthermore, our program will focus on behavior change, rather than just awareness-raising.

Opportunities

In MFTransparency’s nascent financial education program, the support of the donor (the MasterCard Foundation) and active involvement of local partners have been strong from the start. These important factors provide us with a significant boost in the design and development of our program, which will be available in a general form by the end of this year for adaptation and use in other countries.

While it is too early to predict exactly what the financial education program will look like, we can say with certainty that no matter what, our program will allow us to test a number of innovative concepts and apply lessons from other fields in terms of behavior change.

Challenges

While there is some evidence that financial education programs have the potential to be effective when developed using sound research, and when content and delivery are designed using lessons learned from past projects, the jury is still out on the effectiveness of programs in terms of changing behavior. With regard to transparent pricing, framing our objectives in terms of behavior change means that we should not just aim to help people define interest rates and be able to calculate them, but to use these abilities to make informed decisions about credit.

Another challenge is avoiding the “forever pilot phase” (as the Swedish International Development Agency (SIDA) so succinctly put it) or a one-off program or campaign. Our greatest challenge is to come up with a cost-effective, useful program that regulators, financial institutions, or NGOs will take up and use. In the absence of ongoing donor funding or a clear social mission (like that of Habitat for Humanity in Uganda), even good financial education programs do not survive infancy. With the support of its excellent partners, MFTransparency’s program is well-positioned to be the exception to this trend.

One of my favorite pod-casters, Russ Roberts, has stated that “innovation is a largely trial-and-error process.” Luckily, MFTransparency, while on the cutting edge with this program, has good company in this journey. With a clear idea of our advantages and limitations, we look forward to starting our needs assessment this month. We will be sure to keep our wider group of stakeholders updated using the blog and website as we gather information and begin to design and pilot our financial education program!

For more information on MicroFinance Transparency’s financial education program, contact Jessica Massie at massie@mftransparency.org

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by Jessica Haeussler

Earlier this month we launched the Transparent Pricing Initiative in Zambia and Tanzania with training workshops in Lusaka and Dar es Salaam. In just the first few weeks of these projects we have already learned a lot about the pricing practices in these markets and the role that MFTransparency can play in providing institutions with technical skills for implementing more transparent pricing.

Three of the major components that the Initiative in Zambia and Tanzania will focus on are: the collection and publication of pricing data, training on pricing transparency and the development and dissemination of educational materials. Financial institutions in both Zambia and Tanzania have expressed an overwhelmingly strong interest in technical assistance and training, the most enthusiastic response we have received so far in the enabling APR & EIR Program. In particular, these institutions are eager to receive training in costing, how to determine the break-even point on a product by product basis and how to price each product competitively. Several institutions explained that up to now they have simply adopted the same pricing practices as their competitors. Others have not analyzed their cost structure and adjusted their prices in the past several years. It was easy to see how institutions will be able to immediately implement learnings from the training we offered in each country.

Our launch workshops also initiated dialogue and raised awareness on the importance of pricing microloan products based on the unique cost structure of the individual institution. Discussion at the workshop focused on the importance of analyzing prices by product as opposed to overall portfolio yield. For example, while an institution’s portfolio yield might be positive, if one or several products are not profitable the indicator can be misleading. This may not present a problem today, but if the “loser product” is among the fastest growing products, the institution could soon face financial difficulties. We will dive deeper into technical topics such as this in our upcoming training sessions.

Another topic of particular interest is financial literacy and transparent communication to clients. At MFTransparency, we are currently implementing a pilot financial literacy program in Malawi and Rwanda. We expect to have the first training materials tested and ready for broader implementation in the next couple of months and will then work with our in-country partners to adapt them to the local context of Zambia and Tanzania as well. In two to three months we will then travel to Zambia and Tanzania to provide tailored training to local financial institutions on the aforementioned topics and present these new financial literacy materials.

As always, our first activity in this Initiative is data collection. Over the coming weeks I will be based in Zambia to assist local institutions in the data submission process, while my colleague Joseph Kiirya will stay in Tanzania and lead the data collection activity over there. We are excited about the great level of support and interest among industry stakeholders in both countries and look forward to our continued collaboration!

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MicroFinance Transparency (MFTransparency), an international non-governmental organization, on Monday launched its Transparent Pricing Initiative in Zambia.

Click here to read the Microfinance Focus article

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LANCASTER, PA USA & LUSAKA, ZAMBIA, June 20, 2011 –MFTransparency has successfully launched the Transparent Pricing Initiative in Zambia, the sixth country in the MasterCard Foundation-funded enabling APR & EIR Program.

The official launch workshop took place in Lusaka on June 6. In this workshop, Alexandra Fiorillo, Vice President of MFTransparency, provided training on pricing transparency to more than 40 participants representing a range of local industry stakeholders including some of the leading financial institutions in Zambia and a high-profile delegation from the Bank of Zambia.

Co-hosted by AMIZ, President Dr. George Mulomboi also spoke. Workshop attendees actively participated in the training, discussing some of the most important issues in the Zambian microfinance market. The Guest of Honor was Dr. Caleb Fundanga, Governor of the Bank of Zambia. During his inaugural address he stated that it is “imperative that all institutions provide the price of their loans in terms of the Annual Percentage Rate rather than a monthly percentage” so that “consumers would have a clear picture of precisely how much they need to borrow relative to their income levels…resulting in responsible lending and a more competitive and transparent microfinance industry.”

The event in Lusaka marks the launch of the Transparent Pricing Initiative in Zambia, during which MFTransparency will collect and publish pricing data for microfinance products offered in Zambia. Through this Initiative, MFTransparency will facilitate discussion on issues related to pricing transparency as well as develop and disseminate financial literacy materials for microfinance clients. MFTransparency will work closely with its local partners, AMIZ, the Bank of Zambia and ZACA (Consumer Association of Zambia) to promote standards for transparent pricing in the Zambian microfinance market. More information is available here.

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About MFTransparency

MicroFinance Transparency is an international non-governmental organization founded in 2008 with the purpose of facilitating transparent markets through pricing disclosure, education and policy advisory. MFTransparency represents an industry movement toward transparent practices and responsibility. Based in the United States, the group has organized transparent pricing efforts in Kenya, Malawi, Uganda, Rwanda, Ghana, South Africa, Senegal, Burkina Faso, Benin, Togo, Mali, Niger, India, Cambodia, Bangladesh, Azerbaijan, Bosnia, Bolivia, Ecuador, Argentina, Colombia and Peru. For more information please visit www.mftransparency.org.  Grameen Bank’s Dr. Muhammad Yunus and Elizabeth Littlefield, former CEO of CGAP, as well as nearly 800 industry professionals and organizations have committed to transparent pricing by endorsing MFTransparency and its initiative. For information on MFTransparency staff, please see Who We Are.

About the enabling APR & EIR Program
The Transparent Pricing Initiative in Zambia will also mark the launch of the sixth country project in the broader enabling APR & EIR Program. The enabling APR & EIR Program is short for enabling Africa to Price Responsibly & Educate on Interest Rates. A client protection effort of unprecedented scale in Africa, the project will raise awareness of transparent pricing issues in Malawi, Uganda, Rwanda, Ghana, Tanzania, Zambia, South Africa, and Mozambique. The main objective of the enabling APR & EIR Program is to promote improved consumer protection principles through microfinance product pricing transparency. Launched in August 2010, Malawi was the first country of the enabling APR & EIR Program to begin the Transparent Pricing Initiative. Data for Uganda and Rwanda is forthcoming.

For questions relating to this press release please contact:

Jordan Filko
MFTransparency
+1.973.868.8375
jordan@mftransparency.org

To submit data to the Transparent Pricing Initiative in Zambia please write to  zambia@mftransparency.org

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Click here to read the Microfinance Focus article

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LANCASTER, PA, USA & ACCRA, GHANA, June 15, 2011 – Innovative Finance Limited, Association of Progressive Entrepreneurs in Development, Community Aid for Sustainable Development, E-Life Development Agency, Initiative Development – Ghana, Opportunity International Savings and Loan Limited Ghana, Sekam Trust International, Grameen Ghana, CashPhase Ghana Limited and AIDEZ Small Project International are the first ten microfinance institutions to participate in the Transparent Pricing Initiative in Ghana by submitting microloan product information and pricing data.

Through this commitment to transparency and client protection, these institutions have established themselves as leaders in the Ghanaian microfinance market. To date, 33 additional institutions in Ghana have followed their lead by beginning the process of submitting data to MFTransparency.

MFTransparency launched the Transparent Pricing Initiative in Ghana in February 2011 with widespread support from a range of industry actors. Working in partnership with the Ghana Microfinance Institutions Network (GHAMFIN), Association of Rural Banks (ARB), Association of Non-Governmental Organizations (ASSFIN), Credit Union Association of Ghana (CUA) and Ghana Co-operative of Susu Collectors Association (GCSCA), MFTransparency began the Transparent Pricing Initiative in Ghana with two training workshops in Accra and Tamale, attended by more than 130 representatives of leading organizations in the Ghanaian microfinance industry. The workshops provided participants with training on issues related to transparency and consumer protection.

Innovative Finance Limited (IFL) was the first Institution in Ghana to submit pricing data. They recognized the value in the Transparent Pricing Initiative immediately, attending the workshop in Accra and scheduling a meeting with MFTransparency shortly thereafter. After this the data submission was nearly complete, reflecting IFL’s unhesitating dedication to making its prices known. IFL has established itself in the Ghanaian microfinance industry through its innovative services, focused on customer satisfaction and social responsibility. IFL also contributes actively to the development of the Ghanaian microfinance industry as a member of GHAMFIN.

Association of Progressive Entrepreneurs in Development (APED), World Vision partner, completed its data submission in an organized and swift manner.  Widely known in the Ghanaian market for its fight against poverty through the development of sustainable micro enterprises owned primarily by women, APED maintains a close relationship with each client.

Community Aid for Sustainable Development (CASUD) was also quick to demonstrate its commitment to transparency, working closely with MFTransparency to complete their data submission quickly and efficiently.  With a focus on providing women with financial credit, CASUD works to provide education to these women as well.

MFTransparency awards transparency certification to all financial Institutions who submit data and commit to educating their clients on pricing. This consists of both a certificate to be displayed in the financial institution’s offices as well as a seal of transparency logo to be used on the institution’s marketing materials and website. All financial institutions in Ghana  who have yet to submit their pricing data to MFTransparency are encouraged to do so, to show their clients, the Ghanaian microfinance market and the international microfinance community their commitment to transparency.

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About MFTransparency

MicroFinance Transparency is an international non-governmental organization founded in 2008 with the purpose of facilitating transparent markets through pricing disclosure, education and policy advisory. MFTransparency represents an industry movement toward transparent practices and responsibility. Based in the United States, the group has organized transparent pricing efforts in nearly 30 countries on four continents, including 15 countries across Sub-Saharan Africa. For more information please visit www.mftransparency.org.  Grameen Bank’s Dr. Muhammad Yunus and Elizabeth Littlefield, former CEO of CGAP, as well as nearly 800 industry professionals and organizations have committed to transparent pricing by endorsing MFTransparency and its initiative. For information on MFTransparency staff, please see Who We Are.

About the enabling APR & EIR Program

The Transparent Pricing Initiative in Ghana is part of a broader project funded by the MasterCard Foundation and known as the enabling APR & EIR Program (enabling Africa to Price Responsibly & Educate on Interest Rates). This project began in August 2010 with Malawi and continued with Uganda, Rwanda, South Africa and Ghana. Project launches in Zambia, Tanzania and Mozambique are forthcoming. In each of these countries, MFTransparency collects and publishes data on the interest and fees charged on microfinance loan products in order to calculate their accurate, true prices (Effective Interest Rates). As part of the enabling APR & EIR Program, MFTransparency also conducts training seminars for financial institutions, funders, regulators and industry support organizations, facilitates discussion on policy for pricing disclosure and client protection and produces educational materials tailored to the specific needs of different stakeholder groups, including financial literacy programs for borrowers.

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