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- IRC
- Skype
- Mailing lists (see Existing Mailing Lists and indication of topics for given list Mailing List Topics)
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Q4: Why is it that some MFIs carry out their business operations without the use of centers and some do not? It can depend on the organization’s target population. Rural microfinance programs which require loan officers to travel to various rural (and usually informal) locations to conduct loan transactions. In my current organization, we hold meetings in local churches or schools, and groups attend the closest regional meeting even if they are technically from a different geographic region. In a previous organization, loan officers met with three rural groups per day in different locations, usually a group member’s home. In both cases, it didn’t make sense to have an actual center due to the geographic distribution of rural loan clients and the cost of maintaining a fixed center in a rural, low density location. |
Microfinance Domain
Definition of Microfinance or Microcredit
MFI/NGO (Organisation)
MFIs/NGOs exist to provide financial services for clients
*client may want to use these services due to:
- they are very poor and have no collateral and can't getting banking services from other sources
- the MFI/NGO provide better deal than local loan sharks/banks
- the MFI/NGO may also provide training/education/advice as part of package.
- some MFIs/NGOs are poverty-focused and interested in improving the lives of their clients
- some MFIs are profit-driven and interested in making a profit from provision of their services
MFI/NGOs range is size. They are classified as tiers e.g. tier-1, tier-2, tier-3, tier-4, tier-5 etc
An MFI/NGO can have one or more offices from which financial services are administrated and run. Whilst smaller MFIs can be more focused on a specific region/area, larger MFIs may have branches spanning both urban and rurual locations.
Office (Office Heirarchy)
Client
- clients typically are very poor and have no or little collateral
- some clients will have collateral (savings, other) and just require access to funding
- for those with no collateral, credit or loans are typically provided using the concept of 'joint liability', several clients will form a group and accept 'joint liability' of the loan. The internal peer pressure ensures that clients meet their repayments
- the provision of loans for clients/groups can be linked to collateral, e.g. if 'joint liability' loan no or little collateral may be required, if individual loan, a higher loan-to-collateral ratio maybe required
- for clients/groups that exist in rurual locations, its typical for 'field officers' to travel to a 'center' (which is typically some building in village convenient for the members of center/group) where repayments/deposits and new groups/clients are handled
- for clients/groups in urban locations, its typcial for them to walk into branch and carry out transactions
Center
Q1: What is a center?
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