ABSTRACT
Approach We now assess the abil ity of CDFIs to influence well-being – a pro cess which works at several levels, including their impact on the indi vidual client, on the com mun ity in which they live and work, and on the national eco nomy. In this chapter, we con sider only the impact on indi viduals; impact at the level of networks and com munit ies is con sidered in Chapter 5, and impact at the level of public-sector rev enue and pub licly provided bene fits in Chapter 6. For the indi vidual CDFI client, more over, we are seeking to assess only one dimension of impact – the impact margin – which is the meas ured influence of a loan or other fin an cial inter ven tion on indi vidual well-being per beneficiary. This is not the same as the overall impact of a CDFI. Overall impact is the product of the impact margin and the number of beneficiaries (or outreach), which was analysed in Chapter 3. Our purpose is to assess the impact of CDFIs on various dimensions of wellbeing – income, human capacities and intra-community relationships in par ticular. Our income meas ures have both a current (or short-term flow) and an asset (or long-term stock) dimension. The asset dimension is wide, en com passing stocks of phys ical capital (such as buildings and equipment), fin an cial liquid ity (savings), human capital (education, applied know ledge and health) and social capital (the bene fits to be derived from personal relationships and mem ber ship of networks), one aspect of which is empowerment (e.g. abil ity to manage debt, or escape from dependence on moneylenders).1 Vulnerabil ity is another meas ure often used to capture the capa city of an indi vidual to withstand current and future shocks, which typ ic ally relates some meas ure of assets to a meas ure of the shocks which the indi vidual is likely to ex peri ence (see Moser 1998; Dercon 2006). In this study, we experiment with a range of asset and vul ner abil ity measures, of which we argue below that the most robust are savings, education, health-seeking beha vi our and dependence on doorstep lenders. Between them, the pro mo tion of these indic ators may be seen as a concerted attack on the ‘five giants’ – pov erty, unemployment, squalor, ignorance and disease – which Lord Beveridge announced his intention to slay through the estab lishment of the welfare state nearly seventy years ago.
