Words from the participants


How Oikocredit Leveraged SAM to Expand Its Risk management Program

Since 2015, Dutch cooperative investor Oikocredit has offered a risk management program for MFIs. Participating institutions have built action plans around efforts such as: (1) increasing their use of data from credit bureaux to reduce over-indebtedness; (2) adjusting loan officers’ workload and training to improve client service; and (3) surveying clients about product terms. When expanding the program to a new country, Oikocredit holds a workshop that is open to the entire sector to engage potential partners. From this pool of workshop attendees, those who demonstrate the greatest motivation and ability to make progress in risk management receive a package of consulting services lasting 18 to 24 months.

SAM 2017

The program first was active in Benin, Ghana and Togo. As a result of Oikocredit’s sponsoring an event at the 2015 SAM in Dakar to increase awareness of its risk management efforts, several institutions from other countries expressed interest in the program. One of these was the Association Professionnelle des Systèmes Financiers Décentralisés du Sénégal (APSFD/Senegal), whose members include 105 savings & loan associations, cooperatives, MFIs and other financial services providers.

At the 2017 SAM in Addis Ababa, representatives of Oikocredit discussed the risk-management program with staff from ICCO Cooperation, a group of entities that seek to “create profitable opportunities that lead to more employment and higher income for people” in low- and middle-income regions. Based on their work in 36 countries, ICCO Cooperation staff argued that Burkina Faso would be a prime market for Oikocredit’s program. After Oikocredit staff met with existing and prospective partner institutions from the country, such as Asiena, Prodia and the Federation des Caisses Populaires du Burkina (FCPB), they agreed that expanding in Burkina Faso would be fruitful.

"We reviewed our priorities after SAM and promoted Burkina and Senegal to include them in the next phase of the risk management program."

Y.KOMACLO

Yves Komaclo | Oikocredit’s Regional Manager for West Africa

Yves Komaclo, director of Oikocredit in charge of West Africa, explains: "We reviewed our priorities after SAM and promoted Burkina and Senegal to include them in the next phase of the risk management program. " Oikocredit is now working with ICCO Cooperation to expand the program and serve MFIs in Burkina Faso, Mali and Senegal.

In parallel with the risk management program, Oikocredit progressed on other fields during the SAM. For example, his team spoke about the digital initiative for Oikocredit's MFIs in Burkina Faso with the Burkina Faso Private Enterprise Credit Agency (ACEP), one of five members of ACEP International. This initiative aims to facilitate access to financial services for micro-enterprises and SMEs by exploiting Oikocredit's fintech experience in supporting MFIs wishing to adopt mobile financial services.

During speed-dating sessions and informal conversations during the SAM, Oikocredit also identified partners interested in social audits and evaluations of their client protection practices. Among these partners are the Network of Micro-institutions of Income Growth, a mutual credit and savings of Mali and the Mutual Savings and Credit (MEC) Fadec Njambur of Senegal.

How Paidek is Leveraging SAM to Diversify its Funding Sources and Product Line-up

Rémy Mitima

Remy Mitima | Paidek GM & MAIN President

Remy Mitima, who serves as general manager of the Congolese microfinance institution Paidek, has attended all three SAMs. He explains, “In Arusha, I met partners who ended up loaning us a total of USD 500,000 in two phases. This helped us strengthen our credit portfolio and serve more people. Today, we have an additional loan from the same partners.”

At the second SAM in Dakar, Remy and his team strengthened their relationship with other organizations that may help with the evolution of the MFI’s technology. Musoni is one group with which they began discussions, but Paidek hasn’t moved forward in this area yet due to budget constraints.

“I met partners who ended up loaning us a total of USD 500,000…. Today, we have an additional loan from the same partners.”

SAM 2017

At the most recent SAM in Addis, Remy says his team learned “a lot about lending to youth.” As a result, the institution has resolved to adjust its methods for working with young people. Paidek has submitted an application to the UN to support these changes and now is waiting for a reply. Attendees from Paidek also met with old and new partners regarding the organization’s transformation from an NGO into a for-profit entity, which remains ongoing.

Paidek, which is located in the city of Bukavu in the Democratic Republic of the Congo, was founded in 1996 and now has nine branches. The institution has total assets of USD 5.3 million, a gross loan portfolio of USD 3.9 million outstanding to 15 million borrowers, and USD 500,000 held for 980 depositors.

Remy also serves as President of the Microfinance African Institutions Network (MAIN). MAIN, which is a co-organizer of SAM, officially merged with Africa Microfinance Transparency during the most recent SAM. Based in Togo, MAIN has 84 members with an aggregate loan portfolio of USD 1.26 billion outstanding to 3.2 million customers in 23 countries.

Using SAM to Align Financing Needs, Social Impact in Mozambique.

Unnamed

When Francisco Cuamba, the Finance Director of Mozambique’s Microbanco Confianca (pictured at left), came to Luxembourg for European Microfinance Week in November, he was very pleased to"win a free registration to the 2019 SAM, which will be held in late October in Ouagadougou, Burkina Faso. Reflecting on the 2017 SAM in Ethiopia, he said, “My participation in SAM was an extremely important opportunity to meet different organizations from all over the world to share different experiences and meet some investors to which to present my organi-zation. The type of investors we sign should be social investors that are not only concerned with the profitability of the investment, but also our  extensive involvement in the development of our community and changing lives.” In particular, Mr Cuamba expressed plans to learn more about SPI4, the fourth iteration of a set of social performance indicators (SPIs) intended to simplify reporting and provide a common language for social performance management. The 2017 SAM included a full-day training on SPI4, and similar opportunities are expected at the 2019 SAM, the agenda of which is currently under development.

“My participation in SAM was an extremely important opportunity to meet social investors that are not only concerned with the profitability of the investment, but also our extensive involvement in the development of our community and changing lives.”

Microbanco Confianca was created by the NGO Hluvuku-Adsema, which was formed in 1996. The institution now has 13 branch locations, 87 employees and 9,120 clients. With a loan portfolio equivalent to USD 3.5 million, it generated return on equity of 17 percent and return on assets of 9.1 percent during 2017. The majority of the staff and clients of the organization are women. The creation of Microbanco Confianca, which remains owned by Hluvuku, will allow the institution to accept deposits.

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