Impact Assessments Can Help Refine Rural Finance
Observation: Among the things we have consistently learned in our work is the importance of impact assessments in refining the design and implementation of future programmes and projects. Regardless of whether we are doing it on a World Vision area development project, IFAD’s agricultural/ rural finance intervention, Care’s Y/VSLA initiative or Opportunity International’s education promotion programme, the experiences are similar: learnings from evaluation aid the re-thinking of future initiatives for improvement.
Recent case: Late 2024, FRIENDS Consult conducted a comprehensive impact assessment, for aBi Finance Ltd, on three capacity-building interventions delivered to 21 Tier 4 financial institutions (SACCOs and credit-only MIFs) across Uganda. These institutions are vital for agribusiness value chains and financial inclusion in underserved communities. This complemented a similar evaluation exercise FCL did a year earlier on 25 other rural financial institutions that had accessed similar capacity building earlier.
aBi’s capacity building interventions focused on:
- Risk management – developing forward-thinking strategies for risk management to boost long-term sustainability
- Social and environmental performance management – promoting green finance for climate-smart agriculture and other sectors
- Peer-to-peer learning – facilitating knowledge exchange among the participating financial institutions for cross-fertilization of sound practices.
Process and findings
Combining qualitative and quantitative research methods, triangulation, longitudinal and latitudinal comparatives, target/ outcome analysis and other approaches, the analysis concluded that the interventions were largely successful in:
- Improving and entrenching effective risk management
- Helping the institutions to green their offerings and implement requisite social performance management
- Getting business collaboration between and among the institutions that benefitted from the project
- Overall improvement in performance among the beneficiary institutions.
Wider benefits
For aBi Finance, the recommendations for future project design improvement will strengthen its role as a leader in sustainable development finance by improving efficiency and effectiveness. For 4 financial institutions, improved risk management and ESG focus will improve both financial and environmental sustainability. For Uganda’s economy, better project design in the future should improve financial inclusion, agribusiness returns, environmental conservation, food security, and overall resilience – contributing to inclusive green growth, poverty reduction and Government’s ambitious ten-fld growth.
Welcome to work with us
Interested in expert impact assessments or capacity-building support? Seeking expert project evaluations, financial consulting, or capacity-building? Contact us at info@friendsconsult.co.ug or +256 200 904981 to transform your organization’s sustainability and performance. Let’s partner for impactful results!
Dr. Keren Obara
Projects Officer; FRIENDS Consult