New Frontiers in Micro-Savings

This paper states that savings mobilization is critical to the continued growth and evolution of the microfinance sector. Mobilizing savings will empower depositors, strengthen MFIs and alleviate poverty in ways that lending alone cannot offer.

The paper draws on the experience of the Grameen Bank, Grameen Foundation MFI partners and emerging consensus of thought and practice leaders. It makes the following recommendations:

• Influential institutions should stress the importance of microsavings to the poor and the MFIs that serve them;
• Product development, technology and awareness about best practices are important for MFIs introducing savings services;
• Institutional development is critical in the context of microsavings;
• MFIs need human, financial and technical support to introduce savings faster and more responsibly, in a regulatory environment that is often not supportive.

Interviews with leading practitioners offered insights for MFIs seeking to launch and promote savings programs. These include:

• Do your market research;
• Create options, reliability, and flexibility for clients;
• Educate clients about the advantages of savings;
• Create incentives to save, and market your products creatively;
• Be innovative and proactive.