Paper

Letter to Practitioners by Alex Counts, Susy Cheston, Joanne Carter & Kate McKee About the Progress and Outlook for the Implementation of Poverty Tools

Note on U.S. legislation on the Microenterprise Results and Accountability Act of 2004
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This letter intends to clarify and underscore the importance of key elements of the Microenterprise Results and Accountability Act passed by United States Congress in 2004. It shares the vision behind the law and also tries to clear misunderstandings about the technicalities of the law. A few of the clarifications that the letter includes are:

  • The Act does not mandate that 50% of the microenterprise clients be among very poor, but that 50% of the USAID's total microenterprise development resources benefit that group;
  • The Act does not mandate that enterprise development programs or policy reform activities cease or even that they necessarily be scale back.

The letter also states that the law gives the microfinance and microenterprise communities an opportunity to take a quantum leap forward in the area of social performance. It states that the Act can also be used as a catalyst for a sector wide effort to develop social performance transparency, standards and benchmarking. This would facilitate sector-wide innovation and enhance performance.