(MFI-BC) Model Transformation

Overview

Grameen Foundation is bringing mainstream banking to the doorstep of the low income segments through this project. Grameen Foundation is helping an Indian MFI, Margdarshak Financial Services Ltd (MFSL) transform from an organization focused on credit alone into a sustainable and scalable business correspondent (BC) of a commercial bank.  MFSL will act as an agent for the bank, enabling it to provide savings and other services to at least 40,000 low income segments, women clients in the state of Uttar Pradesh. Grameen Foundation worked with the MFI at the strategic level in developing a BC strategy and diversifying banking partnerships for the BC channel, which led to two additional banking partnerships. In addition, Grameen Foundation provided technical support on technology development, business process re-engineering, change management, and staff and client training.

Impact Highlights

More than 25,000 low income households have been provided access to credit and the MFI has been able to expand its reach across 6 additional districts through the BC channel. MFI has significantly re-engineered its delivery processes, process times for credit delivery have come down by 25{2382e02857292b6eafd237571e3abe7645aa48c6a9d39376bdebe696ef57ad7b}.

Role of GFI

• Assess existing product, processes and systems at Margdarshak to understand gaps and opportunities for BC channel enhancement
• Assist Margdarshak to draw its medium term BC channel strategy in coherence with the larger growth strategy of the institution
• Build institutional capacities (human capital, technology) at all levels that allows Margdarshak to effectively scale up its BC operations
• Lead process reengineering efforts at Margdarshak for bringing in efficiencies in BC operations
• Conduct client level researches to factor in needs of the end-users in design/implementation of BC channel
• Provide digital financial services expertise to all the key stakeholders in project
• Own project management responsibilities on behalf of all the stakeholders in the project
• Conducted baseline assessments of Margdarshak key systems and processes (IT, HR, BC operations)
• GFI led the efforts to add an additional BC relationship (IDBI)
• GFI is leading technology integration efforts for existing and new BC relationship at Margdarshak
• Ongoing engagement with Margdarshak on change management activities including customised Management Development Programme (MDP) for middle management

Related Information

Videos

• • GFI along with its research partner conducted HCD (human centred design) research to scope out non-credit products that would resonate with clients of Margdarshak. The video can be viewed here
  • Overview of (MFI-BC) Model Transformation

Blogs

• Read our blogpost on a five-point checklist for Indian Microfinance Institutions that want to become Business Correspondents
• Read our blogposts on the challenges faced by banks for forming such a partnership-
  • Partnerships for Financial Inclusion in India: How Banks See the Challenges–Part 1
  • Partnerships for Financial Inclusion in India: How Banks See the Challenges–Part 2
  • Read our blogpost on Quick technology workflow fixes to enhance a Microfinance Institution’s Business Correspondent operations
  • Quick-technology-workflow-fixes-to-enhance-a-microfinance-institutions-business-correspondent-operations

Stories Of Change