Why do Apple and Starbucks have some of the most loyal customers on the planet? Because they listen to the people they serve. Responding to customer needs is important for any business, but it is especially critical for organizations that serve marginalized people who have spent much of their lives without a voice in their own future.
At Kiva, we believe in a future where people in every remote part of the world hold the power to make better opportunities for themselves. Financial inclusion is a critical first step towards that goal, but in order to truly empower microfinance clients to lift themselves out of poverty, we must ensure that their voices are heard throughout the process.
For Apple and Starbucks, a strong service orientation has been critical for success. Both companies make an effort to understand what their customers want and strive to deliver on it. Apple created its Genius Bar to engage directly with customers, solve their problems, and learn about how their products are being used. Starbucks uses in-store client surveys to measure customer satisfaction, and relies on established policies to quickly respond to customer complaints. Have you ever been unsatisfied with a beverage at Starbucks? I bet it took them less than a minute to apologize, find out what went wrong, and replace your drink.
How can microfinance institutions learn from the customer focus of companies like Apple and Starbucks? By adopting a culture of service orientation and adapting products and services to the needs of their clients, they can ensure that they are developing with, not for, their beneficiaries.
With-not-for means including the beneficiaries in decision making and project development. While meeting customer needs is a goal of most businesses, the burden weighs especially heavily on microfinance institutions, like Kiva’s Field Partners. These MFIs have socially oriented missions to reduce poverty, empower women, or enhance rural economies. Many serve clients with backgrounds of limited access to basic services, and so must study their clients carefully to be able to offer loan products and services that meet their particular needs. They must have a low price point to be affordable to the very poor; they should include a delivery mechanism to counter lack of mobility of many rural residents; and they often should include components that are attractive to farmers who make up the bulk of many rural communities.
In Kenya, the Ushindi Borrower Group with Field Partner One Acre Fund, for example, may care more about flexible repayment options for their farming loan. In Lebanon, individual borrower Ismaiil may instead need larger loan amounts from Field Partner Al Majmoua to stock his convenience store. From loan product to repayment schedule, people’s needs are diverse and MFI services should reflect that.
Earlier this year, Kiva unveiled Social Performance badges for our Field Partners to recognize organizations that go above and beyond to generate positive outcomes for the communities they serve. With badges for everything from “Innovation” to “Vulnerable Group Focus,” Kiva uses Social Performance criteria to recognize Field Partners who demonstrate a commitment to addressing the various social circumstances of their clients. The badge for “Client Voice” is awarded to organizations who — like Apple and Starbucks — empower clients to be the ultimate judge of their own needs by implementing systems for gathering customer feedback and adjusting services accordingly. Field Partners with a “Client Voice” badge are standouts in the realm of client-centered microfinance, and we think that’s worth rewarding.
At Kiva, we know that every lender wants to maximize their impact when making a loan. But we believe that it is equally important to ensure that our microfinance clients get to maximize their input and have a say in how a loan will most positively impact their life. If that matters to you, I invite you to use Social Performance badges — particularly the badge for Client Voice — the next time you’re making a loan on Kiva. It’s a great way to increase both your impact and theirs; creating opportunities with-not-for entrepreneurs around the world.
JD Bergeron – Director of Social Performance, Kiva