Lessons from MicroSave's Action Research Programme (2005)

This briefing note documents lessons learned by MicroSave in 2005 about market-led microfinance under its Action Research Program (ARP). It discusses lessons learned about the following:

Strategy:

• It is important that there is strategic alignment and a shared vision among the staff, management and stakeholders of a microfinance institution (MFI);
• It is also important to have strategic marketing, a re-worked approach to technical assistance, excellent governance mechanisms and appropriate risk management.

Branding:

• Branding is more than just the logo;
• It is important to take care when contracting out;
• It is important to link into the strategy of the financial institution.

Post transformation savings mobilization: success in this area involves:

• Marketing and segmentation;
• Differentiation and positioning;
• Staff incentives for saving.

Lending: successful lending involves:

• Pilot testing;
• Loan portfolio audit;
• Compliance.

Communications and customer service: success in this area involves:

• Feedback loops;
• Growing a service culture throughout the institution.

Performance: success in this area involves:

• Incentives for staff.

Success in electronic banking involves:

• Realizing that electronic banking is a necessity;
• Avoiding a mis-match between promises and delivery;
• Making a choice to become part of a larger outsourced solution.