Measuring Socioeconomic Impact of Credit on SMI: Assessment of the Monitoring System Used by the Alexandria Businessmen's Association, Egypt

This study aims to:

• Evaluate the accuracy of the impact data being collected by Alexandria Businessmen's Association (ABA);
• Make recommendations concerning the need for changes in and additions to the indicators used for measuring impact;
• Determine progress towards the goal of graduating ABA borrowers to the formal banking sector and provide recommendations to facilitate this development.

The main conclusion drawn is that the ABA has had an enormous impact on its small and micro industry clients. However program methods of measuring socioeconomic impact have not captured most of that impact

The main problems of the ABA socioeconomic impact monitoring system are:

• The questionnaire is administered without any incentives for the extension workers and the applicants;
• The questionnaire is highly redundant;
• Some of the data provided are misleading;
• The questionnaire presumes growth through credit and does not allow for the possibility that other effects from credit may be occurring;
• The project is evolving, but the questionnaire is remains rigid.

The paper makes the following recommendations:

• Administer the system from the time of the first loan;
• Reduce other indicators in the survey to those most readily quantifiable, able to be answered accurately and susceptible to change over time;
• Add a code for client status with the program;
• Treat the clients as business people rather than as beneficiaries.

The availability of ABA credit has been a godsend under the circumstances of recession. With regards to graduation of program clients to the formal banking sector, the banks have yet to reach the point of understanding the potential of such loans.