Discussion paper on impact measurement methodologies for EFSE Development Impact Studies

The European Fund for Southeast Europe (EFSE) intends to contribute to the discussion on impact assessment methodologies in inclusive finance. The following paper draws conclusions from three Development Impact Studies conducted by EFSE between 2006 and 2010 and from initial lessons learned from the current EFSE Development Impact Study 2011-2014. In 2011, EFSE decided to work closely with research institutes in developing adequate research designs for inclusive finance impact measurements, in particular the impact of development oriented funding on the ability of micro, small and medium-sized enterprises to create and preserve employment.

The paper briefly describes different research methodologies, elaborates which of those research methodologies EFSE can apply for its current Development Impact Study 2011-2014 and reflects the earlier impact studies conducted by the Fund between 2006 and 2010 against this background.

In this context the paper also raises the question whether it is always possible to measure the impact of “access to finance” or whether impact assessments should refocus on “quality of finance”, i.e. how different product characteristics such as loan sizes, maturities or currency denominations impact differently on the ultimate clients of financial services.

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