Improving Microfinance Governance

This note discusses a training course that CAPAF and its partners launched with the help of USAID in Francophone Africa. The course was designed to help MFIs assess their governance by analyzing stakeholders, their decision-making process and their crisis management capacity. In Francophone Africa, governance remains a challenge for MFIs because of their organizational and legal structure. Many of them were established with a cooperative model of governance and/or have recently transformed from donor projects to licensed financial service providers. Following the training, MFIs are better able to assess their strategic actions and address challenges to good governance. The document describes the course components and the success of the course. Challenges to the roll-out of the governance course include:

• Scarce human and financial resources that restrict CAPAFs ability to maintain quality control;
• Governance could exacerbate internal politics and conflict as it deals with sensitive information;
• Difficulties in identifying competent trainers and consultants who are politically neutral;
• Lack of awareness and literacy among MFIs as well as board members.