The Progress out of Poverty Index (PPI): Drawing Value from Data >

Rachel Huntsman

For a microfinance loan officer, managing a portfolio of hundreds of clients and keeping a vigilant eye on the financial bottom line is critical for reaching sustainability and scale. At the same time, she wants to serve her poor clients and help them to move up the economic ladder.

How can a loan officer and the poverty-focused organization she works for do more than just talk about the social bottom line? Can social performance management become tangible in the same way that financial indicators are? VisionFund International, a network of over 30 microfinance institutions serving 1.2 million clients, is working to answer these questions by identifying key social performance measurements that are useful to stakeholders and colleagues in the field and in the head office. One such measure is the Progress out of Poverty Index (PPI) that can target and track client poverty levels.

How do we use the Progress out of Poverty Index (PPI)?

The first way VisionFund uses the PPI is to understand new borrowers’ poverty rates. By incorporating the PPI survey with loan applications, VisionFund can analyze client poverty levels at both the global level and the branch level. Through a branch-level analysis, a branch manager is equipped to ask questions about the effectiveness of her team’s poverty outreach and can understand the differences in the levels of poverty and living circumstances of clients they serve. Managers also use the PPI to benchmark client poverty rates against regional and national levels, which holds them accountable for potential mission drift.

With the PPI, VisionFund analyzes whether clients continue to live at the same level of poverty over time, or whether they become relatively less or more impoverished. Initially, this seems to be a simple question of comparing baseline and follow-up surveys. We have learned, however, that this involves a level of data management and evaluation that is a step beyond and required for analysis of client targeting. To address this, VisionFund has worked extensively with Mark Schreiner to develop a spreadsheet-based analysis tool that streamlines the tracking process. This tool enables us to break down the data in different ways, such as by gender, location, product, or any other characteristic that is tracked in the questionnaire.

While the PPI is a simple poverty measure, it is essential that data is collected accurately at the source, which is a matter of operational procedures. VisionFund social performance managers work with colleagues in the field to address PPI challenges as these emerge. Implementation is not a one-time process, and VisionFund is eager to share lessons learned during the 2016 SEEP Conference.

Working and Learning Together at #SEEP2016

At the 2016 SEEP Annual Conference, we will discuss how the PPI is useful for targeting and tracking poverty at the Peer Learning Session, “The Progress out of Poverty Index (PPI): Drawing Value from Data”. VisionFund Social Performance Director Johanna Ryan, and Social Performance Manager Rachel Huntsman will share what VisionFund is learning from the PPI. Additionally, PPI developer Mark Schreiner will demonstrate how the PovIt! spreadsheet tool can expedite analysis of PPI data for tracking changes over time.

This blog post originally appeared on The SEEP Network Blog.