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SPM Case Study: Asirvad – The Balance of Social Aspirations and Financial Realities

Posted on by Parul Tandon

In April 2010, Asirvad and Lok brought in MicroSave to undertake a comprehensive social performance management (SPM) diagnostic and action-planning exercise to gain a competitive edge in the fiercely competitive rural lending environment in the South. Asirvad Microfinance Private Ltd. (Asirvad) is an NBFC-MFI operating in 14 districts of the South Indian state of Tamil Nadu. In 2009, Lok Capital (Lok), a social venture fund, became a partner to Asirvad by subscribing to 24% equity.

The SPM diagnostic focussed on the following areas:

Overlap between social and financial performance and mutual reinforcement for better achievement of organisational goals
Synergies between partners through participatory planning/strategising exercises
Focus areas over a definite time-frame
Process improvement
Human Resource Development
Value addition to existing services

SPM intervention led to improvements in product design, client protection, staff incentives, transparency, professional quality services, and sustainability with a goal of increasing outreach to the unbanked.

Understanding the ‘Cost of Cash’ for Low Income Clients: Why and How?

Posted on by MSC

Identifying the right Customer Value Proposition (CVP) is essential for the large scale adoption of m-banking or mobile money services. MicroSave developed a “cost of cash” tool specifically around for understanding the pain involved in cash transactions (with an eye towards presenting an m-banking solution to alleviate the pain), which helps e/m-banking stakeholders to discover which suite of transactions to focus on. The initial research results helped mChek in India to refine its overall un/under-banked strategy and in developing new service offerings for its partners and end-clients. These are described in more detail in IFN 52 “Removing the Pain from Using Cash: An M-banking Solution?”

Characteristics of Mumbai Microfinance Market

Posted on by MSC

The Mumbai market is unique and needs to be approached in a different way by MFIs. Since Mumbai is a busy place, MFIs need to make their operations efficient and faster: weekly group meetings are likely to be unpopular. This Note analyses the way poor entrepreneurs in Mumbai currently finance their businesses, and the options and opportunities for MFIs in Mumbai. It then provides some pointers on how best to design products for this unique urban market, and concludes that with care, and thoughtful product design, Mumbai promises to be a very lucrative market for microfinance.

Risk Management Booklet

Posted on by Parul Tandon

The Risk Management Booklet is the fourth publication under the Optimising Performance and Efficiency Series (OPES). The OPE Series brings together key insights and ideas on specific topics, with clear objective of providing micofinance practitioners with practical and actionable advice.

The Risk Management Booklet is a compendium of MicroSave’s Briefing Notes and India Focus Notes which focus on a wide range of opportunities, issues and challenges.

This brief publication mines MicroSave’s rich experience and blends it with that of leading consultants and practitioners in the field of Risk Management. Risk Management is more important in the field of microfinance due to absence or near absence of traditional risk mitigation mechanisms like collaterals and guarantees.

The monitoring, analysis and management of credit risk under group or individual lending models is core to the effective functioning of an MFI.

The Overlap between Customer Service and Social Performance Management

Posted on by Parul Tandon

MicroSave has worked with a variety of banks and MFIs across Africa and Asia to implement customer service programmes that have made significant impact on the organisations’ social performance. MicroSave’s customers focus interventions involve the following activities:
– Understanding client needs to develop tailored products and services
– Studying client drop outs to prevent the same in the future
– Collecting client feedback to design suitable client protection strategies
– Client reach- out strategies for better beneficiary-targeting
– Studying staff motivation for better service to the clients
– Crafting client -delight strategies to offer them services far in excess of their expectations.
– Aligning systems and processes towards the objective of client delight articulated clearly in the Mission statement.

Through SPM diagnostics, MicroSave helps MFIs to prioritise and choose concrete steps to take in the implementation of proposed SPM improvements. It helps in providing expert technical assistance to ensure implementation of the recommended measures.