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Principle #1 – Appropriate Product Design and Delivery This presentation is made possible by the Smart Campaign www.smartcampaign.org
Principle #1 –
Appropriate Product Design and Delivery
This presentation is made possible
by the Smart Campaign
www.smartcampaign.org
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1. Client protection principles
2. Principle #1 in practice
3. Participant feedback
4. Tools for improving practice
5. Conclusion and call to action
Agenda
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1. Appropriate product design and delivery
2. Prevention of over-indebtedness
3. Transparency
4. Responsible pricing
5. Fair and respectful treatment of clients
6. Privacy of client data
7. Mechanisms for complaint resolution
Client Protection Principles
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1. Client protection principles
2. Principle #1 in practice
3. Participant feedback
4. Tools for improving practice
5. Conclusion and call to action
Agenda
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Appropriate product design and delivery
The Principle in Practice:
• Providers take adequate care to design products and delivery channels in such a way that they do not cause clients harm.
• Products and delivery channels are designed with client characteristics taken into account.
Consider this:
Appropriate products and services not only provide access to clients, but they also create value for clients.
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Suitable Products
Suitable Design
Suitable Delivery
Multiple and/or flexible loan products address different business and family needs.
Repayment schedules are flexible and match cash flows. Loan size matches financial need.Services are reliable, convenient, and function as advertised.
The Principle in Practice
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Simple Products
Affordable Products
Minimum Changes
Product terms and conditions are easy for clients to understand and compare.
The product cost, size (or coverage), and frequency of payment fit within the client’s capacity to pay.Changes to the product (cost, terms, conditions) are minimal/ infrequent.
The Principle in Practice (Continued)
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Beyond credit
Service provider covers costs but does not deplete small savings through excessive fees.
Clients are not excluded from savings, nor are gradual savers penalized.
Savings
Service provider makes payments in a reasonable amount of time.
Clients know when to expect the payment and have access to their money quickly.
Payments
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1. Client protection principles
2. Principle #1 in practice
3. Participant feedback
4. Tools for improving practice
5. Conclusion and call to action
Agenda
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Feedback from participants
Does your financial institution offer multiple loan products or flexible ones that address different businesses and family needs?
How do you know if clients think your products/services are convenient and easy to use?
How do client characteristics (e.g. location, gender, access to technology) affect how you deliver your products?
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1. Client protection principles
2. Principle #1 in practice
3. Participant feedback
4. Tools for improving practice
5. Conclusion and call to action
Agenda
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Tools available from the Smart Campaign
Technical Tools
Getting Started Questionnaire: Self Assessment for MFIsSmart LendingSmart SavingsEducating Clients About Client ProtectionA Technical Guide for Investors
Samples and Case Studies
How to Talk to a Bank: A Brochure for Consumers
Client Protection and Financial Education Simulation
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1. Client protection principles
2. Principle #1 in practice
3. Participant feedback
4. Tools for improving practice
5. Conclusion and call to action
Agenda
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Appropriate products and services are in line with client needs. Appropriate delivery channels offer reliability and convenience.
Appropriate product design and delivery is essential for preventing over-indebtedness.
The Smart Campaign is developing tools to help practitioners adhere to this principle.
Call to Action: What next steps can your institution take to ensure that products and services are designed and delivered in an appropriate manner?
Conclusion
Credit, savings, insurance, and payments products should be designed with client characteristics taken into account.
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