The European Code of Good Conduct (CoGC) has been developed by the European Commission with the objective of setting out standards in terms of operations and reporting, that are common to the microcredit sector in the European Union.The Code provides guidelines to better enable the sector to face the challenges of accessing long-term finance and provide good practice guidelines on the basis of which microcredit provider managers and boards can take actions to enhance their organizations.
To be able to benefit from an EaSI Microfinance Guarantee or EaSI Technical Assistance, non-bank microcredit providers have to sign up to the Code and banks have to endorse it.
√ For Microcredit providers: ensure recognition and set public mark of achievement, contribute to improvement and implementation of best practices, facilitate access to European source of funds;
√ For customers: ensure that they are treated in a fair and ethical way;
√ For investors and funders: guarantees that the sector operates with transparent and pan-EU reporting standards;
√ For regulators: gives some reassurance that the sector operates according to sound business practices and principles, and that it is well governed.
The Microcredit provider has to sign the CoGC as first step and start implementing the standards as prescribed in the CoGC Methodology and get familiar with the Code Guidelines. The provider fills then in the self-evaluation and uploads its financial and social data on the EaSI MicPro platform. Since the signature of the CoGC, the institution has 18 months to implement all the standards. If the provider requires further time to implement clauses, it can apply for an extension through DG Regional Policy. Once the provider is satisfied and it has made the necessary changes to comply with the Code, it will notify MicroFinanza Rating that it is ready to start the evaluation.
The process consists of offsite and onsite verification by our trained and independent analysts.
Please note that if the provider believes it already complies with a sufficient number of clauses to reach the global minimum mark, then it may want to start the evaluation sooner than 18 months after the submission of the sign-up form.