Paper
Individual Lending for MFIs – Strategic Issues to Consider First
Developing strategic considerations for individual lending products
2 pages
MicroSave's Briefing Note No. 84 discusses the strategic considerations that MFIs have to take into account before designing an individual lending (IL) product.
For more than a decade, MicroSave has been working with MFIs to develop IL products. The strategies outlined in the paper should ideally be factored into the MFIs strategic planning, and also need to be considered before beginning market research. They include:
- Target markets for the new IL product should fit with the MFIs vision, mission, and objectives;
- MFI should study the market in which it operates and analyze all factors which are likely to influence the success of IL in the present and future;
- MFI may move from its current product and clients to offering current products to new client base, or develop a new product for an existing or new client base.
Finally, when moving beyond group lending to the IL market, the MFI must be ready to make significant institutional changes with considerable investment in time and resources.
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