Professional Documents
Culture Documents
Maximu
m
30%
60%
10%
100
%
Scor
e
24.3
%
53.3
%
8.0
%
85.6
%
M-CRIL
Janalakshmi
Mr. V.S.
Phone:+91-080-
Structure
Assessment tool and framework
Code of Conduct performance &
Rationale
Strengths & issues
Introduction and background
Microfnance policies
Products loan, insurance and other
Integrity, Governance and HR
Strategy
o Integrating Social Values and
Compliance at
Institutional
level
o Governance
o Human Resource Strategy
Compliance with guidelines
pertaining to clients
o Client Origination and targeting
o Loan Appraisal Process
o Loan product features and pricing
o Transparency
o Responsible lending
Grievance mechanism
Annex
o Profle of the Board
members/ Shareholding
o Privacy of client information
2
pattern
o Client Awareness from Field
interactions
o Methodology and Sampling Plan
o Assessment tool: weight,
scores and performance
o Abbreviations
Janalakshmi Financial
HO
HIGH
Branches
HIGH
Janalakshmi Financial
Follow-up
HIGH
The various aspects the Unifed Code of Conduct have been reclassifed by
M-CRIL under two broad heads (Integrity, governance & HR strategy, and
Effectiveness of client education efforts and awareness) as per their logic
and ft. Further, considering the importance of RBI guidelines and the Fair
Practices Code, the same have been assessed under a separate head Compliance with regulation pertaining to clients
Compliance with guidelines, being one of the most important aspects, has
been given the maximum weight of 60%. Integrity, Governance and HR
Strategy follows with 30% weight, and efforts for client education, along
with client awareness (as refected through client interactions) is given a
10% overall weight.
Level of internalisation of the codes of conduct by the MFI has been
analysed for Approval, Documentation, Dissemination and Observance
(ADDO) under each category, wherever applicable.
Janalakshmi Financial
Integrity
10.0%
Governance
10.0%
Human
Resource
Strategy
10.0%
Compliance with regulations
pertaining to
Client
Origination
and
targeting
9.0%
Loan
Appraisal
Process
9.0% Loan product features and pricing
10.0%
Transparency
10.0%
Responsible
lending
9.0%
Grievance
mechanism
9.0%
Privacy
of
client
information
4.0%
Janalakshmi Financial
Code of Conduct
performance
Rationale
Integrity,
Governan
ce and
HR
Strate
81.0 gy
Efective
ss of
client
educatio
n eforts
and
79.5
awarene
%
ss
Complianc
e with
guidelines
pertaining
to clients
88.9%
Janalakshmi Financial
Services Pvt. Ltd
Code of Conduct
Achievement
performance
Maximum
Janalakshmi Financial
Services Pvt. Ltd
Strengths
Issues
JFS has assimilated the values
enshrined in the CoC at all levels
of the institution most of these
are practiced at feld level, even
if not formally documented.
Principles of the CoC are backed
completely by the top
management and are included
in orientation of all staff.
Behaviour is a key selling point
for JFS customer feedback
indicated the good behaviour of
staff as a key loyalty point.
Customers ranked JFS high for
the range of fnancial services
provided; biometric smart cards
also remain a unique selling
point of JFS.
Introduction and
background
Introduction and
and the MD & CEO. Other Board members comprise 3 independent advisors
background
and 5 investors.
(See Board Profile, Annexure on Slide 37).
The focus of the Board has been to steer JFS towards a country-wide
presence, and consolidate
its position as a leading urban MFI.
Introduction and
background
Values
Care
Positivity
Professionalism
Excellence and
Team play
Active borrowers
Portfolio Outstanding
Number of states
Mar- Mar11
12
193,51 301,00
5
0
18
35
1
1
10
10
Sep12
434,00
0
55
3
10
Number of cities
47
47
47
Number of branches
66
66
66
38,15 57,67
4
5
91
1,00
9
4
0.80
0.98
%
%
1.8
0.5
%
%
36.9
28.8
%
%
95.6
102
%
%
0.5
1.7%
%
21.3
25.0
%
%
86,30
7
1,48
4
0.19
%
0.6
%
26.0
%
108
%
2.0
%
31.0
%
Number of groups
Staff strength
PAR 60
Write of %
Yield on Portfolio
Operating SelfReturn on average
Capital adequacy ratio
Microfnance
policies
Area Selection
JFS started operations in Bangalore, and expanded to disparate regions - Gurgaon,
Jaipur, Coimbatore and
Chennai), for risk diversification. It has now 66 branches across 47 cities.
Establishment of new branches is overseen by a Branch Expansion Head whose team
prepares Area Potential reports. The reports include weightage for secondary data
regarding urban population (50%), population in the socio-economic segment
appropriate for microfinance (30%) and area of the city (20%). Area surveys include a
interviews with 300-500 potential customers in recognised slums to map unmet
demand.
Branch structure
JFS branches are monitored by a Branch Head (BH), and are divided into 2-3 areas,
each monitored by an Area Head (AH). JFSs model is designed to support multiple
product offerings, hence the responsibilities of customer creation, addition and
servicing are clearly divided between feld staff called Customer Relationship Executives
undertaking Marketing, Sales and Collections respectively (CRE-M/ CRE-S/ CRE-C)
Branches are staffed with at least one CRE-M, and several CRE-Ss and CRE-Cs based on
branch potential.
Client selection
JFS targets urban, low-income women, mostly working as domestic help, factory workers
and doing some entrepreneurial activity either alone or with family members. It is
compulsory that the applicant should get at least a 50% credit score in JFSs loan
process.
Loan process
Microfnance
Each branch has at least 1 CRE-M who identifes new areas for group formation and
policies
liaises with the public, explaining the terms and conditions of JFSs loans to them.
The Customer Representatives -Sales (CRE-Ss) then train interested applicants over 2
days. Training covers all
details and terms and conditions of products.
Microfnance policies
contd.
Loan
Process contd
Documentation is done through a Customer Information Sheet (CIS), which covers
income/ asset/ indebtedness/ demographic details, and is later used for verification.
After this the groups are evaluated through a Group Verification Test by the AH or BH
from another branch, for better stringency. If successful, the group is inducted
through a Group Verification Report (GVR).
Customers applications are sent to a data entry firm where data is captured, and
automated checks are
made for error detection followed by credit scoring of individual customers.
For groups whose customers meet the information requirements, the records are sent
to the Central Processing Centre (CPC) where a credit score report (CSR) is
electronically prepared. A 15% sample tele- enquiry is made to cross check borrower
information by the credit approval team at the CPC. Around 25-50 borrowers per
branch are picked for physical verification by the local credit team in the region. The
credit score should not be lower than 50% for 4 customers and 40% for 1 customer
per group of 5 members.
If the group members pass all these checks, their smart cards are printed and
sent to the respective branches. The loan is sanctioned at the CPC and
customers accounts are created in the Core Banking System, after which a
disbursement list and loan documents are mailed to the branches.
After a pre-disbursement confirmatory meeting which reiterates product terms, the
disbursement is made at the branch. For those customers with savings bank
accounts, disbursements are directly made into their accounts to reduce risk of ghost
loan disbursements.
Microfnance policies
Collections are done by a Customer Service Executive Collections (CRE-C) for a set
contd.
group of centres.
Smart card swipes in the POT terminal are linked directly to the customer accounts in
the Core Banking
System. This prevents any manipulation of repayment data and ensures prompt
identifcation and tracking
of overdues. A printed receipt is given to the customer and the CRE-C signs their loan
card.
Loan
products
Build Up and
Nano
Loan
Loan /
Against
Auto
Property*
Loan*
Loan size (Min-Max)
50,000
5,000-30,000
Target
Urban women over 18 years
3,00,000
Existing
JFS customers
10,000 Based
on
Term (months)
12-24 months
Up to 1
12-36
12-60
-30,000 goldBullet
value 30,000-2
Repayment frequency
Monthly
Monthly
Monthly
lakhs
Grace period (months)
If disbursement in the
N.A
Nil
Nil
latter half of the month,
.
moratorium
on the 1st month
1%
1
Rs. 1000/Rs. 1000/Processing fee
1%
21-23%
%
24% (auto) 26% (LAP)/
Rate of interest rate %
26%
p.a.
26%
based
/26%
28%
(pa)
on gold
(build up)
APR (%)
26% p.a
21-23%
24-26%
26-28%
26.08% p.a
EIR (%)
Inventory
Guarantee/ collateral
Gol
RD Savings
or
Group guarantee
d
(BUp/
ornaments
Property
(LAP)
Guarantor/
Nil
Aut
None
None
24% p.a.
24% p.a.
Penalty on overdues
Prepayment &
None
None
None
2% of amount prepaid
Share in portfolio on 3093
0
1
0%
0%
Sep-12
%
%
%
Product Name
Small
Group
loans
Education
Loans*
Loans
Gold
Loan
products
The above products comprise 94% portfolio. Remaining 6% portfolio is constituted by Enterprise Financial Services loans and
housing loans (see next slide)
* These products had not been rolled out at the time of the assessment visit and have not been evaluated as part
of the CoC assessment.
Housing Loans
JSS has invested in Janadhar Constructions Pvt. Ltd (JCPL), a construction company
exclusively for low cost
housing. JCPL has tied up with builders having core competencies in low cost design.
The model is to build low cost apartments half of which are sold exclusively to families
with monthly
income of Rs. 15,000-25,000 (they need not be existing JFS customers).
The loans extended by JFS are 80% of the cost of the apartment (around Rs. 7 lakhs), at
12.5% interest p.a.
The remaining apartments would be sold at market value at a higher price in the open
market.
JFS and JCPL faced some challenge in converting demand into actual sales because of
rigorous screening of
borrowers, lack of disposable income of applicants, and escalating construction costs.
However, the project is being scaled up, and JFS is trying to tie up with National Housing
Bank for funding/
subsidies.
Enterprise Loans
JFS has a separate vertical for enterprise loans Target businesses have >3 years
vintage and loan sizes
range from Rs 1-10 lakhs. Loan tenure is 12-36 months, with EMIs, backed by post dated
cheques.
Processing fees constitute 3% of loan amount.
Compulsory CIBIL check of all applicants is done at their cost, while a Fraud Control Unit
of JFS investigates
all applications.
There is extensive use of channel referral partners for these loans. Outsourced, RBIcertifed recovery
agents are empanelled for overdue recovery, but selected only after checks regarding
their reputation and
operational practices.
Employees of EFS branches are screened extremely carefully with CIBIL check,
reference checks, and
background investigation to avoid risk of fraud.
Insurance, Micro-Pensions
and Savings
Insurance
JFS has tied up for compulsory life insurance for borrowers with Max New York Life and
for personal accident insurance (optional) with Bajaj Allianz.
Life insurance premium is Rs. 50 per head per year, and 2 members of the family
(customer and spouse/ chief household wage earner) are insured. Coverage is Rs.
25,000 for natural death, from which JFS can deduct its loan outstanding and the
remaining benefit goes to the surviving member. JFS has negotiated for higher pay- out
to cover higher size loans, for slightly higher premiums.
Micro Pensions
Through a tie up with UTI IIMPS, JFS has offered its customers the option of investing
Rs. 100, 200 or 500 per month in a micro pension scheme, which has a lock in period of
5 years.
Payout begins after the customer has reached the age of 58 years. This is marketed as
a cross-sell product linked to group loans. Each CRE-S has a target to extend outreach
of this product to at least 40% of their loan customers.
Customers can call a 24 hour toll free number to seek clarification on product terms,
balances, returns, etc.
JFS has leveraged its parent organization JSS to enter into a BC arrangement with Axis
Bank. JSS staff operate from JFS branches at marginal incremental cost. Currently, only
15% of savings customers are existing borrowers of JFS.
A profile is created in JFSs Core Banking Solution as well for each of the depositors,
and staff are equipped with Axis Banks POS terminals to do real time reporting of
Insurance, Micro-Pensions
collections, directly synced to Axis Banks CBS, thereby preventing any fraud.
and
Savings
Customers save on demand, or immediately after their monthly loan repayment
meetings.
Performa
nce
Integrating
Social Values
and
Compliance
at
Institutional
66.7%
level
.0 %
Human
Resour
ce
Strateg
y
87.7
%
Governan
ce
88.6
%
Achievement
Levels of internalization
Parameter
Integrating
Social Values
and
Compliance at
Institutional
Governance
Strategy
Human
Resources
Documen
Approval
Disseminat
Observ
tation
ion
ance
Good
Moderate
Moderate
Good
Good
Moderat
NA
e
Good Moderat Good
e
Good
Good
Janalakshmis top management had already applied most aspects of the CoC (especially
those pertaining to fair
and appropriate treatment of clients) in its operations before the Code was issued.
After signing the CoC, more emphasis has been placed on implementing its tenets, such
as recruitment
guidelines, avoidance of over-indebtedness, setting up a grievance redressal mechanism,
rather than on
espousing it in written documentation
JFS was also proactive in changing its product terms and conditions in keeping with the
RBI guidelines and
ensuring that its products and processes were all within the scope of the RBI Fair
Practices Code.
There is suffcient supervisory rigour from both Operations (Area, Branch and Regional
Heads) and Internal
Audit to ensure that the tenets of the CoC are being adhered to. The CEO is responsible
Governance
JFS has inducted highly qualified persons with expertise in investment banking, ratings
and advisory services,
and corporate banking in its Board. All Board members have been active in their
engagement with JFS at a
strategy-building level.
JFS has 3 independent directors and 5 investor directors out of a total of 11 members of
the Board
The Board has approved the Code of Conduct and the authorized the CEO to oversee
changes in keeping with
its tenets; the same applies to RBI guidelines and the RBI Fair Practices Code. Monitoring
of Grievance
redressal has been assigned by the Board to the Head of Products.
JFS has appointed an audit committee of the Board with an independent director (Mr.
Sunil Mathur) as
chairperson.
JFS has maintained high levels of transparency in its reporting to the microfinance
industry association MFIN
and industry information networks like Microfinance Information Exchange
(MiXMarket.org)
Transparency is ensured in reporting and presentation of financial statements , which
are shared on the
website as well as on the networks mentioned above.
JFS follows the Audit and Assurance standards issued by the Institute of Chartered
In the event of receiving applications from staff who have worked in other MFIs, JFS
follows the due process
laid down in the CoC, making sure that a reference check from the previous employer is
obtained before
completing the selection process.
Although there has been an infux of staff from other MFIs especially during the AP crisis
period, JFS has
adhered to the norms for hiring these staff.
JFS also conducts its own verification checks by an independent agency, which contacts
the staffs family,
neighbours and finds out about any police record, financial fraud or (in the case of
Enterprise Financial
Services staff) credit bureau-rejections pertaining to the new recruit
JFS makes sure not assign the same operational area to the concerned employee
JFS also provides similar documentation to its own staff who wish to join other
institutions and alerts other
MFIs about staff who have been dismissed for fraudulent or other unacceptable
behaviour
JFS has deliberately not included any special incentives for staffs adherence to the CoC,
as this is
considered a basic requirement necessary for all staff to fulfl.
JFS has a rigorous 19 day training for all its recruits, irrespective of their prior field
experience. Staff are
Scor
e
53.3% out of
60%
Levels
ofDocument
Parameter
Approval
Dissemina
internalization
Client
84.8%
Good Moderat Good Moderat
Origination
e
e
and targeting
Loan Appraisal Loan
Good
Good
Good
Good
Appraisal
Proces
Process
Loan
97.3%
s
Good
Good
Good
Good
product
features &
Good Moderat Good
Good
Transparency
87.3% pricing
e
Responsible
Good
Good
Moderat
lending
Moderat e
Grievanc
Good e
Moderat
e
Moderat e
mechanis
Privacy of
Good Moderat e
client
e
Moderat
pricing
91.7%
Transparen
cy
p
r
o
d
u
95.3
%
Achievement
Maximum
Client Origination
and
Targeting
Borrowers household
income
(HHI) does not exceed Rs
60,000 in
rural areas and Rs 120,000
in nonrural areas
Compliance by JFS
JFS collects borrower self-declaration of income for all
borrowers, ensuring that only those whose declared incomes
are within the Rs. 1,20,000 limit are eligible for group loans.
Phone verification is done for a sample of 15% customers to ensure that the data
reported by them in the
CIS form is in fact correct, especially on income and other borrowings.
As functions of marketing, sourcing and servicing is performed by CRE-Ms, CRE-Ss and
CRE-Cs separately,
CRE-Ss are able to focus on their specific activity and ensure quality in group formation.
As the GVR is done by an independent staff (AH or BH from another branch) there is no
conflict of interest
in terms of quality of group vs business targets
Around 15-20% customers declared a different income to the assessment team than in
CIS, indicating that
self-declaration of income is not a wholly reliable indicator of repayment capacity.
Compliance by JFS
staf in loan
sanctioning & disbursement
Compliance by JFS
JFS submits data to both the Credit Bureaus High Mark and
Equifax
A compulsory credit bureau check is incorporated in the CRM
software, so that
no loan can be sanctioned without having first been approved by
the Credit
Bureau.
In cases where the CB report is erroneous, proof of completion
of the other
MFI loan has to be brought by the customer (cancelled loan
card, with No
Objection letter of other MFI). This is screened by JFS for
authenticity before
the loan is sanctioned.
Deviations in the case of erroneous CB reports, are passed by a
senior person in
the sanctioning team and are logged for further checks by
supervisors/ audit
team.
EFS borrowers are compulsorily screened through CIBIL as their loan sizes are much
higher (Rs 1-10 lakhs).
There is also a very detailed verification which is done on-site as well as an independent
third party
verification performed for such loans. Repayment capacity is established in detail, with
documentary proof
of promoters personal and business income through tax returns, etc.
For JFSs housing loan products there are stringent checks on income levels and
frequency, as well as
detailed repayment capacity calculations, ensuring that not more than 40-45% of a
households disposable
income would be used in monthly loan repayments
25
26
The Fair Practices Code in English and in the State language is displayed by JFS in
its H.O and branches
Borrowers are trained at several stages from CGT till disbursement, to reinforce
their rights and
responsibilities with respect to JFS and its staff
All such trainings are compulsory and are provided by the feld staff, who are
specifcally trained in
how to communicate in a simple and effective manner with the customers.
In addition, JFS screens 5 short flms about various aspects of fnancial literacy, to
help its customers
pick up inputs on budgeting, fnancial planning, saving and borrowing within their
means.
JFS tries to be as transparent as possible within the constraints of its technology
system which does
not allow it to print sanction letters and other customer documentation in a
language other than
English. To overcome this diffculty, JFS prints all customer documentation in the
State language and
hands this over to customers along with English documents.
For those customers who cannot read the State language or are unable to read at
all, the contents of
all documentation are read aloud and translated during disbursement.
2
8
Janalakshmi Financial
Services Pvt. Ltd
2
9
Janalakshmi Financial
Services Pvt. Ltd
3
1
Janalakshmi Financial
Services Pvt. Ltd
JFS had clear and strict guidelines for employee interactions with customers, even before
the Code of
Conduct and regulatory guidelines came into existence.
JFS had already established the practices of addressing borrowers as Madam and
treating them with
utmost courtesy. This has been further emphasised since the CoC and guidelines were
issued.
In the event of default staff do not stay on at the centre but call the Area Head or
Branch Head to tackle the situation so that there is a senior person interacting with
customers and the CRE-C does not get burdened with recovering late payments. Since
the AHs and BHs have several years of experience, they are able to handle the
3
Janalakshmi Financial
2
Services Pvt. Ltd
3
3
Janalakshmi Financial
Services Pvt. Ltd
Responsible lendingcontinued
No cases were reported by customers of any kind of misbehaviour or violation of
ethics (demanding commission, threatening, coercing, snatching assets) by
customers interviewed by the assessment team.
JFS top management has been designated by the Board to implement debt
restructuring and write-of in extreme cases for providing relief to borrowers facing
repayment stress for genuine reasons. The final approving authority in such cases is
the CEO.
Although there is adequate emphasis on how NOT to behave with customers in a default
situation, JFS does not recommend a step by step strategy for overdue recovery, rather it
leaves the Area and Branch heads to develop a case-by-case based strategy.
Grievance Mechanism
JFS has a toll free number for grievance redressal, which is answered by a dedicated
staff. Grievances are recorded, tabulated and reported once a month to the
Products Head.
Customers are informed about the grievance redressal mechanism during both preloan training as well as pre-disbursement interaction. The toll free number is printed
in large print on the plastic cover of the loan card, as well as on the card itself and
the vernacular sheet.
Customers are encouraged to call the number to seek any information or resolve queries
as well.
Separate numbers are given for seeking information on Micro-pensions (IIMPS micro
pension helpline) and
Industry Association (Sa-Dhan and MFIN) numbers are also provided.
A complaint and suggestion box is installed at all branches with the Regional Heads
name and phone number pasted on the top. Regional Heads check the boxes and
compile feedback received from this channel every quarter. The feedback from this
channel is quite low, but the toll free number is expected to be an easier channel for
customers.
Volume of grievances received through the toll free number is quite low (25-30 per
month), indicating that customers may need some more time to assimilate the
concept of a helpline. Of these, 80% are inquiries about various products.
A large number of cases go unreported as customers come to the branch or call the AH
or BH directly to resolve their queries or to make a complaint. The answer or solution is
also given verbally and the case is not recorded as branch staff perceive that since it is
addressed, there is no need to document it.
Almost all customers could point to the grievance redressal toll free number on their
documentation though
hardly any had ever used it even to make inquiries
There is as yet no fxed Turnaround time for grievance redressal, but once volumes
pick up JFS will need to design an escalation matrix with time frames for resolution.
There is also a perception that the more grievances recorded, it would reflect badly on
the branchs
performance. This negative perception will have to be changed through inputs from
senior management.
clients
JFSs internal audit scope covers client protection issues adequately. These are
investigated in the field as
part of the checklist for customer interactions.
Any changes to CoC is communicated to all JFS staff through the release of an internal
circular by Audit
department and all staff can be audited thereafter for adherence of the same
Supervisory visits to centers by the Area Head and Branch Head adequately cover
adherence to various
aspects of the guidelines and CoC, especially Respectful Treatment of clients and
Grievance Redressal.
Avoidance of Over-Indebtedness, Transparency and Privacy of client data are
adequately built into the
operational processes to ensure that there is no scope for flouting these principles
Performa
nce
Scor
e
8.0% out of
10.0%
100%
100%
80.0%
79.3%
Levels of internalization
60
%
40
%
Document
Approval
Dissemin
Observance
ation
ation
Parameter
20%
0%
Client Education (Efforts)
Client
Awareness
and other
Results
Client
Education
Efforts
Client
Awareness
Good
NA
NA
Moderat Good
e
NA
Good
Good
JFS has designed its systems so as to provide customers with full and fair information
and enough
reinforcement of product charges and terms and conditions over repeated interactions,
for customers to
make an informed and unhurried decision.
Preliminary information about the company and its range of loan products and broad
terms and conditions
are given by the CRE-M at the time of liaison and relationship building in the area.
2 day training during group formation serves as the basis for potential customers to
decide whether they
want to become group members or not.
The GVR process ensures that applicants have understood all product terms and
conditions and charges, as
well as group responsibility and group-related processes adequately.
Pre-loan disbursement session conducted by the Area Head, ensures that customers are
able to clear any
doubts and that any misinformation from the CRE-S is adequately addressed before
actual disbursement.
1 day group training is conducted before every subsequent loan cycle to reinforce
product features
The issue of mis-selling has been addressed. CRE-Ss are not allowed to give details of
pension and savings
bank products to customers before disbursements so that customers dont feel
compelled to take these
Annex
es
Board Member
Position on
1
B. Mathur
Independent
Director
2
Uday Chitale
Independent
Director
3
Rama Bijapurkar
2010
Director
India
4
2010
5
2011
Experience
Zaheer Sitabkhan,
Director Investor
Earlier with
Lloyd George
Management;
Former Venture
Head of Capital
LG Asian
Plus Fund
T. S. Siva Shankar,
Private
Equity, in Citigroup
International
Director,
Director
Was earlier part of the Special Situations group with investments across private
equity / public
6.
Narayan
Ramachandran
7.
2008
S.Viswanatha
8.
2012
9.
2006
Prasad,
Vikram Gandhi
10.
Ramanathan
V.S. Radhakrishnan
2011
11.
2006
38
2010
Ramesh
Srinivasan
Founder
Promoter
MD & CEO
Vice
Shareholding Pattern
1
Shareholder
Value
% of total
2
Treeline Asia Master Fund (Singapore) Pte. Ltd.
1,997,120
20.27%
3
Bellwether Microfnance Fund Private Limited
1,091,280
11.07%
4
Michael and Susan Dell Foundation
493,260
5.01%
5
Lok Capital LLC
6
Narayan Ramachandran
Badri Pilinja
10
All others
39
Class
Class A
Class A
Class A
Class A
Class A
Class A
Class A
Class B&C
Class B&C
Class B&C
Methodol
ogy
Preliminary analysis of MFIs information, review of available
reports and fnancial
statements
Visit to Head Ofce of MFI
Discussions with the Vice Chairman, CEO, Head of Strategy & Planning, and Head of
Products department
broad strategic issues and mission orientation, commitment towards CoC
Discussions with the senior management (Operations, Human Resources, Training,
Internal Audit) to understand MFIs objectives, market strategies, methodology,
products and services, integration of CoC in policies and procedures
Review of manuals, various report formats, various documents and Board minutes
Discussion with Branch Head and all branch staff on different aspects of CoC, MFIs
policies and procedures
Documentation review client basic profile forms, loan application forms,
internal audit reports, complaints register if any and CoC displays
Methodol
Data Analysis and Report writing
ogy
Internal Review at M-CRIL
Report draft sent to SIDBI
4
1
Janalakshmi Financial
Sampling
Plan
Branch
1 KBS
2 HSR
3 KR Puram
4 CBD
5 B G Road
6 Malathalli
7 Alandur
8 Porur
9 Uttamnagar
10 Mangolpuri
11 Jaipur
Grand total
4
2
Region
Karnataka
Karnataka
Karnataka
Karnataka
Karnataka
Karnataka
Tamil Nadu
Tamil Nadu
Delhi
Delhi
Jaipur
Loan
LCycleL
7
14
L4
7
10
7
10
7
18
39
34
Janalakshmi Financial
Customers
15
7
17
21
50
15
32
20
18
29
30
254
Total
No. of
Max
Weights
Indicators
Score
Performance
38
12
42
60
7
19
35
95
10.0%
8.8%regulations pertaining
Compliance
with
to clients
Client Origination and targeting
11
7.6%Appraisal Process
Loan
7
8.8%product features and pricing
Loan
25
9.2%
Transparency
25
10.0%
9.5%
Responsible lending
20
7.9%
Grievance mechanism
10
7.5%
Privacy of client information
6
2.9% education and fnancial literacy
Client
10%
8.0%
Client Education
2.4%
Client Awareness
5.6%
Overall
190
104
520
9.0%
55
9.0%
35
10.0%
120
125
9.0%
100
9.0%
50
4.0%
30
33
165
4
29
20
145
175
3%
7%
870
Abbreviati
ons
ADD Approval Documentation Dissemination
O
AH
AP
APR
ATM
BC
BH
CBS
CEO
CIBIL
CIS
CoC
CPC
CREC
CREM
CRES
CRM
CSR
EFS
EIR
EMI
FPC
GVR
43
Observation
Area
Head
Andhra Pradesh
Annualized Percentage Rate
Automated Teller Machine
Banking Correspondent
Branch Head
Core Banking Solution
Chief Executive Officer
Credit Information Bureau (India) Limited
Customer Information Sheet
Code of Conduct
Central Processing Centre
Customer Relationship Executive CollectionsRelationship Executive Customer
Marketing
Customer Relationship Executive - Sales
Customer Relationship Management
Credit Score Report
Enterprise Financial Services
Effective Interest Rate
Equated Monthly Installment
Fair Practices Code
Group Verification Report
HR
Human Resources
ICAI Institute of Chartered Accountants
of IndiaIndia Micro Pension Services
IIMPS Invest
JCPL Janaadhar Construction Pvt Ltd
JFSPL Janalakshmi Financial Services Pvt
Ltd
JSS
Janalakshmi Social Services
KYC Know Your Customer
M- L Micro-Credit Ratings International
CRI Ltd
MD
Managing Director
MFI Micro Finance Institution
MFIN Microfinance Institutions Network
MIX Microfinance Information
eXchange
NBF Non
Banking Finance Company
C
NHB
National Housing Bank
OSS Operational Self Sufficiency
PAR Portfolio at Risk
PDC Post Dated Cheque
PIN Personal Identifcation Number
POT Point of Transaction
PSL Priority Sector Lending
RBI Reserve Bank of India
SIDBI Small Industries Development
BankTrust
of India
UTI Unit
of India