SmartAid Index 2014

02 July 2014
SmartAid is for all types of funders that want to improve their effectiveness in supporting financial inclusion.

The SmartAid Index (SmartAid) measures whether funders are set up to support financial inclusion effectively. It assesses a funder’s internal systems and practices related to its financial inclusion projects—meaning all projects that contribute to a state in which all households and businesses have access and the ability to use a broad range of appropriate financial services that are provided responsibly and sustainably in a well-regulated environment.

Measuring the effectiveness of funding for financial inclusion is not easy, given the long chain from project design, to implementation on the ground, to impact on the lives of the poor. SmartAid focuses on the first part of this chain, funders’ internal management systems, with the simple premise that funders with strong systems are more likely to deliver good projects on the ground. Many factors that affect project performance are beyond funders’ influence, thus SmartAid focuses on those factors where funders have more direct control—their internal systems. SmartAid does not evaluate the performance of funders’ financial inclusion projects on the ground; other tools (e.g., portfolio reviews) exist for that purpose.

In 2006, 29 major development institutions asked CGAP to create a tool that would help them improve the effectiveness of their support to microfinance. In response, CGAP developed the SmartAid Index. Twenty development institutions participated in SmartAid between 2007 and 2013, representing the major funders supporting financial inclusion.

In the past, the SmartAid Index was offered every two years. It was fully administered by CGAP and relied on an external review board consisting of four independent financial inclusion specialists. Going forward, the SmartAid Index is offered as a tool that funders can use with support from certified consultants who have all participated in the previous external review board and have been certified by CGAP. This new approach allows funders to implement SmartAid anytime, whenever it is strategic and feasible for them. It also makes SmartAid accessible to a larger array of funders.

Over the years, the methodology was refined to focus on the most relevant aspects of funders’ internal systems, but also on those that can objectively be compared across different institutions. Although SmartAid evolved to reflect changes in the industry, for example, the shift from microfinance to a broader vision of financial inclusion, the essence of SmartAid hasn’t changed.

While changing internal systems takes time, the results from past SmartAid rounds are translating into concrete improvements. For more information on SmartAid and funders’ SmartAid reports, visit This Technical Guide is aimed at funders interested in analyzing their effectiveness in financial inclusion. It describes the methodology of the SmartAid Index and explains how to use SmartAid.