Using Microfin 3: A Handbook for Operational Planning and Financial Modeling
This document provides guidance on using version 3 of Microfin, a set of Excel-based business modeling worksheets designed to develop five-year financial projections for MFIs. It also provides an overall framework and general background information for strategic and operational planning.
Business planning is an essential management function, and detailed financial projections are crucial elements of a business plan. Financial projections support strategic and operational planning processes and help to demonstrate the viability of the business plan. The handbook and the Microfin model are structured according to a best practice planning approach that is appropriate for most MFIs. This approach concentrates on four key areas of an institution’s operations. They are:
- Products and services;
- Marketing channels and projections of activity;
- Institutional resources and capacity;
- Financing.
The handbook includes case studies with examples and detailed data from the business plan of a fictitious MFI, the Freedonia Enterprise Development Association (FEDA). Users can enter data into Microfin to create a practice model, which allows them to experiment and develop a thorough understanding of its capabilities and operations.
