analytics softawre soutions in microfnance and banks
TRANSCRIPT
Analytical Software Solutions in Microfinance Institutions and Banks
Research Report 2015
Sana HimayatResearch and Communications Manager
MFI Insight analytics
Jamal MbarkiLaboratory of computer science research (LARI), Faculty of Sciences, Mohamed Ier University,
Oujda, Morocco.
Sidi Yasser El JasouliCEOMFI Insight Analytics
Frederic Lepottier Business Development ManagerMFI Insight Analytics
Table of Content Introduction
Section 1:Microfinance Institutions and Business Intelligence
Section 2: Research Methodology
Section 3: Organizational Profiles
Section4: Results and Discussion
Conclusion
IntroductionRole of analytical solutions in microloan providers
Survey from microfinance institutions
Understanding there business operations and level of ICT automation
Knowing about their interest in the use of Analytical Solution
Role of analytical solutions in organizational sustainability
Microfinance Institutions and Business Intelligence
Microfinance is serving the underserved with smalls loans
Microfinance is spreading due to the increasing demand and interest towards poverty alleviation
Business intelligence in such organizations
Improves performance and operations
Reduce transactional costs
Quick decision making through consolidated and concise data
Reporting and monitoring
Quick report making
Makes organizational sustainable
Research Methodology Research Focus
The focus of this research is to find out the use of analytical solutions for microfinance services.
Approach Quantitative approach Survey with 10 closed questions
Data Collection & Time Frame Online Survey from MFIs and Banks Follow up phone calls Data collection through 4 months
Survey Design Multiple choice questions
Participant Outreach
Participant Outreach
Organizational Profiles
Organizational Profiles
Results and Discussion1- Do you use analytical solutions?
2- Are you able to track the performance of your products, branches, loan officers and vintages?
Results and Discussion3: How often are you able to track performance?
4: At what level does your organization track write-offs and recoveries?
Results and Discussion6: Do you have an accounting, banking and LPM systems?5: Are you able to identify the drivers of your operating
expense?
Results and Discussion8: Is your organization able to measure penetration ratio to consider potential opportunities for growth?
7: Do you have credit scoring system?
Results and Discussion10: If there was an analytical solution that covered all the areas of MFI operations listed above, would you purchase it for your organization?
9: Are you able to provide your donors with reports that they require about outreach, customer segmentation, customer satisfaction, retention ratio, etc?
Results and DiscussionAnalytics Tools- A Part of the MFI Roadmap Most organizations have some of of the 3 systems, Accounting System,
LPM System and Banking System Analytical solutions support organization to achieve all results by
incorporating the 3 systems, thus improving the performance and output of the organization.
LPM system is used by very few of the participating organizations LPM system is often directly linked with the accounting system allowing
to reduce the time lag for asset recognition Loan portfolio management is an essential part of the system because it
enables to control delinquencies and risks It is a key to identifying PAR ( portfolio at Risk) Stages of Delinquency
Source: Microenterprise Access to Banking Services
Results and Discussion (continued)
Business Process Efficiency of MFI: Portfolio monitoring capabilities Loan tracking systems Vintage Tracking Monitoring performance of branches and loan officers Tracking frequency
Daily tracking of the performance that is accurate and reliable Daily tracking allows the organization to recognize problem areas
immediately and take corrective actions
Results and Discussion (continued)
Business Process Efficiency of MFI: Write-off and Recovery tracking Write-offs and recoveries portray the true state of the organization Analytical solutions track the delinquency cycle and captures valuable
insights in order to create corrective actions Enabling the organization to recover their overdue amounts There is a decrease in the write-offs level consequently reducing the loss
reserve and have better cash flow management tracking the overdue amount at the lowest grain, contract level, enable
the MFI to set efficient recovery process.
Results and Discussion (continued)Business Process Efficiency of MFI: Reporting capability Reporting is an important aspect of a loan portfolio Success of the organization can be determined by reporting capability towards
donors Reporting is a powerful tool to improve the performance of MFIs and its
transparency Analytical solutions enable the organizations to provide the donors with reports Various Reports :
Loan Portfolio Data Quality Revenue, Growth and PerformanceQuality based on Client, Business and CharacteristicsLoan collection (PAR)Financial sustainability (adjusted return on assets)Client poverty levelsThe amount of funds usedThe amount of loans that were made
Results and Discussion (continued)Business Process Efficiency of MFI: Level of ICT Automation Organizations need ICT automation to run their business process successfully with analytical solutions Different organizational maturity stages depending on level of ICT automation and features of tools used
Organizational Maturity Depending on ICT Automation LevelMaturity Level 1 & 2
Conclusion Organizations that are using analytical solutions are at maturity level 3 of the industry
Microfinance organizations are willing to install this new system, thus creating a demand for analytical technology
in the industry.
Business intelligence has an impact on the performance of MFIs and banks and it plays a significant role in poverty
alleviation through MFI sustainability.
Analytical solutions improves organizational performance, accuracy an reduces errors
Analytical solutions enables better reporting allowing for improved decision making
It plays a significant role in performance of MFIs and its sustainability
Analytical solutions indirectly leads to poverty alleviation
Conclusion Features of analytical software solutions that organizations adopt gradually leading to better
performance of organization and its sustainability.
Research carried out by MFI Insight Analytics
The complete publication can be found on our website.
www.mfianalytics.comEmail: [email protected] http://issuu.com/mfianalytics/docs/report_dec_2015