AdvertisementGrowing microfinance commercialization causing declining women clientele
- Wednesday, October 13, 2010, 12:40
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Microfinance Focus, Oct 13, 2010: Speaking on the opening panel of Asia Microfinance Forum, Ms. Mary Ellen Iskenderian, President and CEO, Women’s World Banking drew attention of the audience towards the alarming trend of declining women clients in the fast growing microfinance institutions across countries.
Expressing her concern Ms. Mary said, “As institutions are moving upmarket, there is a trend of moving away from women clients. We were shocked to discover that after transforming into NBFCs (Non-Banking Financial Companies) microfinance institutions are having just 64.5% clients as women against a client base of nearly 88 percent prior to transition”.
Concluding her remarks on this trend, Ms. Mary said, “Microfinance was built on the trust worthiness of women and perhaps we need to remember those original clients as we move forward”.
“Strong trend of commercialization is reducing the ability of microfinance institutions to reach out to more women clients and we need to take care of it”, she said.
Ms. Mary however pointed out to the positive side of microfinance institutions’ transition from NGOs to NBFCs saying that the transition is a game changer as it allows mobilizing saving products. “Women are the savers in the family and they are going to benefit by saving products”.
Pitching strongly for the need of investing in marketing activities by microfinance institutions, she said, “Microfinance needs to invest in professional marketing and market research to understand different microfinance segments and clients. This will help institutions serve the clients much better”.
Further she added, “Financial literacy which is also tied to marketing has become inevitable in present times and there is a need to promote it”.
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The points mentioned need surely to be looked into with greater care. Rather than looking at commercialization only to enable Micro-finance institutions to perform better INNOVATION and SPEED for DEVELOPMENTS should be addressed more aggressively. ‘Looking beyond the Box’ approach is considered essential.
An approach for enabling speedy growth in terms of Financial Inclusion and Increase in the Market Reach Potential based on an Innovative and simple to operate & manage approach is in the process of implementation. This could provide unthinkable speed of growth – much higher than the present conventional approach by Micro-Financiers.