Automating Microfinance

Evangeline C. Lopez
National Confederation of Cooperatives (NATCCO)
Objectives in automating microfinance
• Tighten internal controls => sound credit mgt.
• Enhance overall efficiency
ƒ Higher outreach
ƒ Faster services
ƒ Higher staff productivity

• Improve decision-making support system for mgt.

• Network branding
• Mission: deliver financial services anytime,
anywhere
Automation phases

1. Adoption of standard banking software

2. Introduction of VAS: ATM banking, card
solutions, mobile solutions
3. Inter-branch / inter-coop connectivity
Automating MICOOP through Ekoopbanker
• Adoption of standard transactional & accounting
software in the MICOOP branches
(also being used in the mother co-ops)

• Windows-based
• Standard reports for performance monitoring,
including PESOS rating
• Target clientele/users: loan officers, tellers,
bookeeper, branch manager
• Branch set-up: 1 server, 3-4 workstations
Manual-to-automated processes
Tellers
Automatic posting of Minimize manual error
withdrawal/disbursement & on posting (wrong
deposit/collection forwarding of balance,
miscomputation, etc.
Systems-generated OR, CV, Minimize manual error
WS, DS
Systems-generated collection Greater transparency
& disbursement report & accountability
Report on checks issued Can easily track
checks issued
Manual-to-automated processes (2)
Loan Officer
Automatic processing Minimize error on loan details
of loan application (e.g. maturity date , deductions
and interest on loans)
Systems-generated Easily identify the loan exposure
loan availment report for each member
Systems-generated Minimize error on preparing
amortization schedule amortization schedule
Systems-generated Provide tool for management in
PAR/ Aging managing delinquency &
evaluating DO’s performance
Manual-to-automated processes (3)

Development Officer
Systems-generated Prevent missed collections or
collection list per failure to collect because a
area / DO borrower’s name was not
included in the list
Systems-generated Can easily identify the
collection report accountability of DOs
Can easily trace blank ORs
(unremitted collections of DOs)
Manual-to-automated processes (4)

Accounting
Automatic posting of Reduce the time of computing
depreciation and interest; minimize computation
interest on savings errors
and time deposit
Systems-generated Easy tracking of account
books of accounts details; effective audit tool
and general journal
Other benefits
• Reduced workload for staff especially in preparing
reports; “mas nakakauwi ng maaga”
• Balances regularly updated; customer profile
easily accessed => enhances positive image of
the branch; members feel secured knowing that
their money is safe
• Improved transparency/better monitoring
• Minimized human errors
Lessons
• Garbage in, garbage out
• IT: “information” before “technology”
• Clear definition of roles; hire competent
staff
• Computerization is possible, even in
remote areas