This paper attempts to give an overview of the international experience with staff incentive schemes. It provides an overview of the staff incentive schemes in other industries, where these are an element of common policy.
It also provides information on some basic parameters of microfinance industry such as outreach and sustainability. The findings in this research suggest that a much smaller percentage of MFIs employ some form of monetary incentive program in Asia but the majority of schemes in place were designed to enhance asset quality and staff productivity. It concludes that the highly productive MFIs are heterogeneous in their staff incentive schemes.
Presents the qualitative research data – the experiences of poor people trying to save using informal sector mechanisms – from the “Relative Risks to the Savings of the Poor” paper. The paper provides details of the richness and complexity of poor people’s attempts at saving in the informal sector and their successes, failures and losses as they do so.
MFIs usually undergo impact assessment reviews and evaluations but rarely do these studies leading to substantive changes within their institution.
This paper highlights the results of the feedback processes at five ImpAct partner institutions– a bank focusing on the low-income market, two group-based microcredit institutions, a set of member- owned financial institutions, and a savings and credit microfinance institution.
The paper builds on the Ford Foundation impact study and examines the lessons learnt for institutionalising the feedback into the MFIs’ systems and products. Further, it makes recommendations on how to complete the feedback loop and accordingly develops a toolkit/checklist to help MFIs use the data they (and their evaluators) collect to make and implement responsive decisions/changes within the organisation.
Many MFIs are looking at new product development as a way of responding to their clients’ needs. This note suggests six essential questions to be asked prior to setting about new product development, which can generally be classified into—motivation, commitment, capacity, cost effectiveness and profitability, simplicity, and complexity. Moreover, it tries to build the understanding of the readers about the complexity and cost of product development. It advises the MFIs that client-responsive products would reduce drop-outs, attract increasing numbers of new clients and contribute substantially to their long-term sustainability.
This note explores dropouts and graduates and their significance for MFIs. Clients drop out of microfinance programmes mostly because of poorly designed products that fail to meet their needs. Not only inappropriate products, but also replication of models and systems without even considering the economic or socio-cultural conditions of the area affects the customer base. It further highlights the implications—such as cost and time—of the clients’ dropout on the MFIs. Graduation and its benefits for NGOs seeking to establish permanent and sustainable MFIs are also discussed.
This paper discusses how low-income people in South Africa (SA) save, how they use different savings services/systems and the impact of these savings facilities on their household budgets/lives. It also discusses how these findings would improve Ithala Bank’s and other institutions’ efforts to mobilize savings. Specifically, the paper:
Studies savings services used and not used by low income people; Examines the perceived advantages and disadvantages of these savings services; Assesses the socio-economic characteristics of the people using them;
Explores how savings services are used to manage household income; Investigates why some people save in kind and which financial services may induce them to start monetary savings; Draws lessons for Ithala and other financial institutions seeking to develop poor-responsive savings services.
The methodology that the study uses is: Focus group discussions; Interviews with low-income people and Ithala officials.
The findings of the paper are:
35 savings products were in use – 17 were Ithala products. The most used products were: Short-term loans from moneylenders; Cash saving through Accumulating Savings and Credit associations (ASCAs); Targeted savings through Ithala; Funeral schemes or burial societies. Ithala had intense competition from informal sector products. Most Ithala clients were low-income people of low literacy, and a significant number were senior citizens; Use of informal sector products was greater than that of the Ithala products. The paper concludes by recommending that Ithala should incorporate some informal sector features into existing and future products.
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