• Microfinancing urged to use right tools, technology


    Microfinance organizations should use the right tools and technology to better serve clients who are lacking access to basic financial services such as loans and savings, according to a technology services provider.

    Berlin-based microfinance and banking technology services provider Mambu said that microfinance organizations must look to technology to scale, monitor and optimize their operations to reach clients.

    It said that besides provide essential loan and deposit services to clients, microfinance organizations, also have to do many of the critical things a bank does to manage its business, including managing and tracking clients, monitoring risk, maintaining an audit trail and reporting to regulators, donors and association stakeholders .

    At the same time, these organizations also need to attract new clients, provide the right kind of products, and grow their business.

    With this, Mambu said that it has finally reached the Philippines to make modern banking technology accessible and affordable via its cloud-based SaaS delivery model.

    “Technology is critical to financial services, whether microfinance or not. Information and knowledge sit at the heart of the banking system: from the customer, to their account to the aggregate balance sheet of the organization,” said Eugene Danilkis, chief executive officer and co-founder of Mambu.

    However, Danilkis noted that without the technology to access to this critical information, microfinance organizations will struggle to become sustainable.

    He explained that the concept of microfinance is a good one, but without the management information needed to attract sustainable funding and provide regulatory trust, microfinance organizations will struggle to scale to service the three billion unbanked individuals and quarter of a billion underserviced micro, small and medium enterprises around the world.”

    Cloud technology

    For Mambu, microfinance organizations can overcome the challenge of management information through cloud technology.

    The service provider said that the beauty of the cloud is that it makes things simple—no complicated IT infrastructure, no costly IT specialists, just a very affordable and accessible approach to getting modern banking technology capabilities, without the headaches and the large bill.

    “By ‘democratizing banking’ in this way, entirely new doors begin to open for microfinance organizations as access to business-critical data and the workflows that support client services, such as loan origination, can be undertaken more easily,” Danilkis added.

    Mambu said that loan officers can take affordable tablets to the field to collect loan applications in real time, accessing client data in real time.

    Without having to worry about servers, IT infrastructure or system maintenance; without being enslaved to proprietary ‘closed’ technology, and the impossible to use interfaces that typically go with it, microfinance institutions can finally focus on their business, their clients and their services.

    It added that cloud technology will help reshape the landscape of banking on a few fronts. From the bottom of the pyramid microfinance organizations will be better able to service sole proprietorships and micro businesses at a scale that makes them sustainable.

    They will also be able to begin to attract the talent and capital to extend services to the small and medium enterprise sector, which is so critical to their business and the local economies. MAYVELIN U. CARABALLO


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