Interview with Vaselina PETROVA, Accounting Standards Analyst, CACIB
and Ali LHAF, Credit Risk Analyst, CACIB
Produced by: Mireille de Kerleau, Communications Manager, CACEIS

Launched by the Grameen Crédit Agricole Foundation and Crédit Agricole SA in 2018, Solidarity Bankers is a skills volunteering program open to all Crédit Agricole Group employees in support of microfinance institutions and impact businesses supported by the Foundation. This is the third episode of the podcast series dedicated to Solidarity Bankers, the skills volunteering program supported by the Grameen Crédit Agricole Foundation and Crédit Agricole SA. The first episode featured Carolina Viguet, Director of Communications & Partnerships at the Foundation and co-initiator of this program, and the second featured Andreas Brunner, Inspection Supervisor at Amundi in Paris, a Solidarity Banker on assignment in Kyrgyzstan. In this third episode, we will share the experience of Veselina PETROVA, Accounting Standards Analyst, and Ali LHAF, Credit Risk Analyst, both at CACIB.

They conducted a field mission in tandem for Faten, a microfinance institution established in 1999 and supervised by the Palestinian Monetary Authority. Faten's mission is to meet the financial services needs of low- and middle-income Palestinian entrepreneurs and individuals. It operates throughout Palestine, the West Bank, and Gaza, through a network of 37 branches and 277 employees.

Before giving the floor to our speakers, let me briefly review the economic and social situation in Palestine.

In a context marked by conflicts and geopolitical tensions, access to essential services in Palestine is a major issue. With a banking rate of just over 25% and an economy heavily dependent on agriculture, microfinance plays a vital role in supporting income-generating activities and rural development. Faten is a key player in financial inclusion in the Palestinian territories by financing economic and agricultural activities and home improvement with its approximately 26,000 clients. Now a significant institution with nearly $140 million in portfolio, Faten is engaged in a process of structuring and transforming itself into a multi-channel, multi-product bank requiring cutting-edge expertise. To support this transformation, Veselina and Ali, specialists in risk assessment, reporting standards, and accounting standardization at CACIB, are supporting it as part of a Solidarity Bankers in tandem mission.

Hello Veselina, hello Ali. So to begin this interview, I would like you to introduce yourself to our listeners.

Veselina : My name is Veselina and I have been working in the accounting analysis team at CACIB for five years now. I am originally from Bulgaria and come from Varna, a city on the Black Sea, where I did part of my studies. I finished my studies in France and have been working here ever since. I am also the mother of two young boys. I love learning and sharing, and this assignment is an opportunity for me to immerse myself in a new environment: microfinance, with issues that have nothing to do with those of a bank like CACIB.

Ali : My name is Ali Lhaf. I arrived in France in 2005 for my studies and since 2010 I have been working at CACIB where I have been a credit risk analyst since 2017. At the same time, I am also a professor. I give finance courses at the CNAM in Paris. For my part, it is extremely important to reach out to others, to really try to share what we have and this type of mission allows me to use my technical skills to help others.

Did you know each other before the mission, given that you work in the same company, or did you meet on this occasion?

Ali : We actually met on this mission and for this mission in particular, we needed someone with a bit of an IFRS expertise, which is Veselina's case, and someone who has more of a credit analyst profile and who speaks Arabic, which is my case. Veselina and I have complementary work.

You are located in the same buildings, are you both in Paris, in Montrouge?

Yes, we are in Montrouge

So you met physically.

Veselina : Yes, we met during the presentation of the mission. Ali, I believe you were the first to contact the Grameen Crédit Agricole Foundation for the mission because when I contacted them, they told me that there was already someone, an Arabic speaker, who had offered to take on the mission, and so they were waiting for someone who had knowledge of IFRS accounting standards.

Ali : Indeed, I have a former colleague who is now in communications, and it was she who actually told me about this mission. She told me that the Grameen Crédit Agricole Foundation was looking for someone who spoke Arabic and who knew a little about the context of credit. And so, I told her, if I can do anything, it would be with great pleasure, and that's how it started.

And you, Veselina, how did it go for you?

Veselina : So I had attended a video conference presentation of the current missions of the Grameen Crédit Agricole Foundation and so I saw that there was this mission for which they were looking for someone who matched my profile. This mission was the only one where they asked for skills that I had and I found that interesting. So I contacted the Foundation and that's it. That's how it happened.

So you each went through a selection process and then you were selected.

Veselina : As for me, when I contacted the Foundation and expressed my interest, they asked me to send my CV, with a brief description of what I could bring to the table, and then they confirmed that my CV corresponded to some of the skills they were looking for. It could be complementary to Ali's profile, and I met them. And I met Ali afterwards.

And from that moment on, did you immediately start working on this mission?

Ali : Actually, the mission was remote. It's not easy to start right away. So we took stock with Faten and they explained what they do. Afterwards, we received a good portion of their documents. We spent a lot of time with Veselina to really understand what the institution does and try to detail their mission so that we could really get a fairly comprehensive idea of their accounts, their business model. And that's how it started. And we also translated because there are documents in Arabic, in English, so we had to understand their documents. And then little by little, we had two or three meetings with Faten and then we started to get into the IFRS / NAF technical part and it was Veselina who brought her skills in this area.

Have you communicated with several people in Faten, or do you have a specific pen pal? Who are your pen pals there?

Veselina : We currently have two main contacts. There were three or four of them at the presentation meetings, if I'm not mistaken. So we have the financial manager of the microfinance institution, one of her colleagues who is competent in the IFRS accounting section and the credit risk models they want us to review. So, there you have it, two main contacts, and then we'll see if we have other people for the other topics we need to review.

Do these people speak mainly Arabic or do they also speak English?

Ali : They speak English too.

This also allows Veselina to follow, I imagine.

Veselina : Yes, in English it's easier for me, indeed.

I was wondering if you have any idea about the culture of the country or not at all? Or do you learn as you go by interacting with these people?

Ali : Personally, I know them a little. I come from Lebanon. Lebanon is not very far from the Palestinian territories, indeed. It's not identical to 100%, but there are a lot of points in common. It's the Orient, ... I know them a little. That does indeed facilitate communication. Honestly, for the moment, things have gone well with them. They were very available ... I don't know, Veselina, what your feeling is, but ...

Veselina : Yes, yes, they are responsive. In my case, I don't really know the cultural environment or anything else there. They are very responsive, they communicate in a natural and professional way like us, so I don't see any obstacles in that regard.

I see the mission will take place one day a week for 15 weeks. Is that more or less the idea?

Veselina : Yes, that's a general framework, it's for guidance only. And then we also adjust it based on our own workload every day at CACIB.

Ali : Indeed. I note that it's a fairly technical mission, honestly, which requires a bit of personal work on our part as well. These aren't necessarily topics that are 100% of our daily life because we work in an investment bank. Here we're really talking about microfinance, so it's not the same kind of work. On our side, it takes a bit of time.

Veselina : Yes, that's it. We have our knowledge, the general framework, well, not just general. We also have specific knowledge that can be useful for the mission. But on the other hand, due to the entity's activity, there are actually very specific points that require other additional expertise. And for example, we're trying to solicit someone at Crédit Agricole more for the retail banking part. Finally, we need additional expertise. So there are pros and cons. The cons are that they can't directly work on the subject for us from the start. But the advantage is that it will allow us to learn other things and also to exchange with other teams at Crédit Agricole, and we hope that people will be able to provide us with what we're lacking.

Ali : The first part is really the technical part on accounting standards and the second part is more the organization between their holding company in Ramallah and the surrounding subsidiaries. So it's the communication between the holding company and the small subsidiaries. So I think these are the two big topics to work on with Faten.

And when you have meetings with them, are you always both there, or are you sometimes alternated, once one, once the other?

Veselina : For now, we've tried to be both. Afterwards, there's no obligation per se, but at the beginning it's important that there are two of us. If there's a need to switch to Arabic, Ali can do it, not me.

When the mission is over, I imagine you will do some follow-up on what is happening and how it is being implemented?

Veselina Yes, yes. That's what the Foundation told us. That the mission generally ends with a meeting that concludes with the achievement of objectives. And we can always keep in touch with the achievement of objectives.

And perhaps one last question that comes to mind. I wanted to talk more generally about the mission of skill donations. Do you already feel that this is a gift of your skills and that you will be useful, that it makes you happy? What does it bring you to do this?

Veselina : We already hope that we will be useful. But once again, we are not even halfway through the mission yet. So we really hope that we will be able to end up with a result that will be useful to Faten. As far as I'm concerned, I was initially interested in being able to participate in a mission like this, a volunteer mission. I think it will be really rewarding in the end, once we see that the result of what we were able to produce corresponds to the expectations, I hope, of our interlocutors.

Ali, maybe you have a feeling about this too?

Ali : While waiting for the result, I hope that we will bring beautiful things to Faten. But on a personal level, giving and sharing is something that touches me a lot, so I really try, on quite a few levels, to do it, either as a teacher if I give classes, or I do interpretation for refugees here in Paris, … I think that if you have something, you must above all share it with others.

Veselina : Yes, and we too will surely learn a lot of things.

Ali : In fact, on a personal and also technical level, yes, really.

Well, thank you very much for this exchange. Thank you for listening to this podcast and I look forward to seeing you for the fourth episode, which will focus, this time, on a field mission in Senegal, carried out by two Solidarity Bankers from Crédit Agricole SA and EFL in Poland. See you soon!

Listen to the podcast here

ACFIME is a Burkinabe microfinance institution that targets highly vulnerable populations excluded from the larger microfinance institutions operating throughout the country. Loans granted by ACFIME therefore have very high potential for social impact.

THE ORGANIZATION AND THE FOUNDATION

As part of the African Facility, ACFIME received a €131,000 grant from the French Development Agency to implement 13 technical assistance missions in various areas (business planning, human resources management, risk management, training, etc.), including the creation of risk mapping and training for the Internal Audit department. The Foundation has also granted three loans to ACFIME since 2014, totaling €732,000.

THE CONTEXT OF THE MISSION

Structuring procedures and risk management are key factors in consolidating and ensuring the sustainability of an institution. As part of the first phase of the African Facility program, ACFIME benefited from an upgrade of most of its procedures. In line with this mission, ACFIME received another technical assistance mission to continue strengthening risk management. The organization was supported by a local technical assistance provider to map operational, financial, and strategic risks and train the Internal Audit department.

THE RESULTS

Thanks to the technical assistance provider's participatory approach and the training of the Internal Audit department, ACFIME has gained autonomy in identifying the internal and external risks it faces in order to measure them and implement mitigation measures if necessary. A risk management committee is now responsible for updating the risk mapping and mitigation plans.

THE PERSPECTIVES

Following these initial positive results, ACFIME now plans to create a risk map for each branch and service point, in order to identify and prevent all risks at every level of the institution. ACFIME also plans to develop a business continuity plan.

This article was published in "Our technical assistance system", accessible here

Measuring the impact of microfinance institutions' performance in 41 countries will be launched in the second quarter of 2022 with the support of industry leaders.

April 13, 2022 – In a global effort to promote standardized and comparable impact data for the microfinance industry, 60 Decibels will release the first microfinance index based entirely on end-client responses later this quarter. This groundbreaking initiative will include aggregated client data from all 72 participating microfinance institutions (MFIs), supported by 19 founding partners. Collected through telephone surveys, the resulting data and insights will be shared in a public report and dashboard to establish performance benchmarks for ongoing impact measurement and management by MFIs and the funders working with them.

The global participation of MFIs was made possible through the support and collaboration of the initiative's 19 founding partners: Accion, Advans, BRAC, ECLOF, FMO, Fundación Netri, Global Partnerships, Grameen Foundation, Kiva, LeapFrog Investments, MCE Social Capital, Nordic Microfinance Initiative, Opportunity International, Pro Mujer, ResponsAbility, SPTF, Symbiotics, WaterEquity, and Women's World Banking. Catalytic and structuring sponsorship for this inaugural effort came from the Tipping Point Foundation on Impact Investing and Ceniarth. Together, these sponsors and founding partners funded projects and committed their portfolios to include MFIs from 41 countries in this research.

“As an investor in microfinance for 14 years, the Grameen Crédit Agricole Foundation is truly delighted to participate in this initiative and support its partners in collecting this data. When it published its impact model in 2020, the Foundation committed to further monitoring its impact. We are therefore pleased that our team has comparable impact data for the first time.”, said Alice Rullier, impact analyst at the Foundation.

For each participating MFI, 60 Decibels researchers surveyed a representative sample (200 to 250 respondents) of MFI clients and conducted a standardized telephone survey to collect quantitative and qualitative data across five key dimensions of impact. The survey, developed by 60 Decibels and based on its experience working with hundreds of businesses in the field of financial inclusion, uses proven questions to assess and compare social outcomes across five impact themes: access, business impact, household impact, financial management, and resilience. Aggregated data from all participating MFIs will establish benchmarks to be shared in the public report, providing essential insight into the range of performance on these key outcomes for use across the microfinance industry.

“We started listening to end customers eight years ago because the standard of practice – things like counting the number of customers reached – didn’t give us insights into whether people’s lives were improving.”, said Sasha Dichter, CEO and co-founder of 60 Decibels. “We are delighted with the response to this initiative and the collaboration of so many industry leaders to listen better and set a new standard in understanding social outcomes. This index takes the value of our impact benchmarks to a new level and helps MFIs and investors understand client outcomes with 100% comparability for each metric.”.

In addition to providing insights that will be directly applicable to impact management in the microfinance sector, the index signals and demonstrates the value of rigorous end-stakeholder outcomes data for understanding impact performance. In the coming year, 60 Decibels will generate sector-level benchmarks through similar indexing efforts in other sectors to increase the importance of listening to end stakeholders to achieve greater impact.

The index is designed to complement and integrate with existing frameworks and standards in microfinance, impact investing, and international development. Participating in the MFI index to conduct client surveys provides MFIs and investors with feedback on SPTF and CERISE recommended practices in the Universal Standards and Client Protection Principles, as well as the SDG Impact Standards, and provides data aligned with IRIS+ metrics and the five dimensions of impact orientation established by the Impact Management Project.

For more information and to receive the 60 Decibels Financial Inclusion Index, Click here.

About 60 Decibels

60 Decibels is a global, technology-enabled impact measurement company that brings speed and repeatability to social impact measurement and customer insights. We provide true impact performance benchmarks, enabling organizations to understand impact relative to peers and set performance targets. We have a network of over 850 researchers in over 70 countries and have worked with over 800 of the world's leading impact investors, corporations, foundations, societies, NGOs, and public sector organizations. 60 Decibels makes it easy to listen to the people who matter most.

About the Grameen Crédit Agricole Foundation

Created in 2008 under the joint leadership of Crédit Agricole SA's management and Professor Yunus, the Grameen Crédit Agricole Foundation supports microfinance institutions and impact businesses in 37 countries as of the end of 2021. A recognized player in the sector, the Grameen Crédit Agricole Foundation aims to work in countries where poverty and financial exclusion are most prevalent. As an investor, lender, technical assistance coordinator, and fund advisor, the Foundation supports 81 partners in 37 countries with more than €78 million in commitments.