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I don’t know the statistics for WT operations, but I know ours. We have on average at least twice as many women applying to us as we can issue loans to. We have neighboring towns asking us every week to expand operations into their towns and since starting in just the town of Yonso, have expanded into three more neighboring towns as well. We have average on-time repayment rates of over 100% across the board. We have only had one default in the two years we’ve been operating out of 250 loans issued so far. Our program, while still small, has grown to the point where it is actually profitable and can cover the expense of our office staff and also contribute a little back to our other programs.

How does one measure the success of a microlending program in comparison to others when each has a different program with different goals? Programs have to be measured by looking at how their repayment rates, borrower satisfaction, and reputation compare to their goals. Some programs are more profit oriented, focusing mainly on high repayment rates and financial growth while others focus on public benefit, offering many free services and running at a loss for the betterment of the community.

I hope this bit of unrandomized, uncontrolled information is helpful.

What is new is that many organizations are getting better at measuring how well these things are working so that they can adapt to local conditions even better. Anecdotes like this one are great for donor reports, but even projects that fail miserably can find such stories.

I applaud Women’s Trust and appreciate your writing about the organization’s work. Still, it would be nice to have something more concrete on which to judge its success than just Sarah Ankrah’s story (and I’m giving the benefit of the doubt here that Sarah is not related to Gertrude Ankrah, the organization’s leader). No, I don’t need randomized controlled trials, propensity score matching, or anything like that. Just some basic info on how many people have been helped in how many years, how many of them turned their loans into something lasting, how many defaults, how much does the program cost, that sort of thing.

Surely you’re not saying that just because it’s local and flexible, it’s success can’t be reasonably evaluated?

Being a Searcher doesn’t mean you’re off the hook.

http://humanitarianrelief.change.org/blog/view/links_for_a_slow_monday_evening_including_of_course_witches

Isn’t there still a place for donor investments in broader public goods? Entrepreneurial microfinance is great but what if all the basic structural obstacles to market efficiency remain unaddressed? And what if (like roads or electric grid) those require investments in the millions or tens of millions USD? You talk about an unused 4-lane aid funded road, surely that’s ’simply’ an issue of improving Ghanaian goverance: better market research, public scrutiny and consultation on infrastructure investment decisions. Or do we throw out the baby&bathwater?

It’s true that donor agencies have for some time talked about local empowerment and decentralization, but there has been a big gap between the rhetoric and the reality. If aid is truly decentralized, it means allowing local stakeholders to define success and redirect resources as needed. I don’t think this means an end to the humanitarian enterprise, but I agree it is problematic. I don’t think adequate attention is paid to the problem of the moral hazard of aid and how to manage it. The mere existence of aid resources changes what local social entrepreneurs do.

I agree with the analysis that it must be less top down. However, this movement has already occurred with many aid agencies for quite some time now and although some gains have been made the system in general is still found wanting. The best way to eliminate top down practices is by empowering the beneficiaries with much more that just aid. Political, economic, and academic empowerment are sustainable practices that are regenerative in nature and transform for generations. But to practice this type of assistance would mean for all practical purposes and end to the humanitarian enterprise. What do you think?

Great anecdote and I agree with your conclusions. There are, however, ways to build these successes into the industry, but it will require aid systems to be much more decentralized, less driven by top down targets like the MDG’s with much more flexibility built into the system. This will also require a shift of decision making power from Washington, New York, Geneva, London,etc. to recipient countries where program managers and their local partners (donors and beneficiaries) will have the ability to change course, fix problems and discover solutions as they go along.

By working with local people and letting the local people organise the project, schools, in this case, can be built for a reasonable amount of outside (aid or other) money.

Other than what has not been said, I applaud the efforts of Dana Dakin and the Women’s Trust but flinch at the planner and searcher dichotomy.