Author: Mariel Vincent Rapisura

Human resource is the backbone of microfinance institutions. Creating a leading microfinance institution takes more than charging the right price and knowing how to design financial products. What sets apart leading MFIs from the rest is their ability to manage human resource properly.  This course offers various tools on how to assess knowledge and skills needed; hiring the right people; designing incentives and compensation package for staff; and creating a work environment that promotes employee commitment. The course centers on the new mandate of human resources – as strategic partner in strategy execution; as administrative expert; as employee champion; and as change agent for continuous transformation. The course also includes developing capacity-building programs and performance-based incentives schemes that benefits the organization’s employees and at the same time increase the profitability of the organization.

Business development services (BDS) is just one among the many interventions that development organizations to make markets work for the poor. The BDS terminology itself is evolving and is increasingly called business service markets, commercially viable solutions, and support markets. The course will focus on approaches that trace the activities from inputs to the delivery of products to end consumers. This includes subsector analysis, market linkages and value chain development. The course will also discuss market development principles; non-financial and financial interventions such as product and technology development; infrastructure; input supply; market access; management and organization; policy advocacy and alternative financing. The highlight of the course is the presentation of two case studies that demonstrate the effective ways on how to design focused, sustainable, demand-driven and cost-effective programs.

The tremendous growth and the maturity of the Philippine microfinance industry experience is manifested in the establishment of legal procedures to protect the sustainability of microfinance institutions amidst issues of delinquency. In 2008, small claims court was established. The act governs the payment of money lent that does not exceed a principal amount of PhP100,000. The course would allow MFIs to integrate small claims court procedure in its operation. Furthermore, the course will introduce to the middle managers the rule of procedures for small claims courts and present actual case on small claims processing. The middle managers will also be trained on the cost-benefit analysis for this legal option.

Effective information systems serve as the foundation for the operations of microfinance institutions, and financial institutions in general. The course offers decision makers specific points in evaluating their existing systems, determining current and future information system needs, and conducting cost benefit analysis when building, modifying or buying software. A framework on developing information system for an MFI will also be presented. The framework includes the following aspects: functionality, flexibility and expandability, usability, reporting capabilities, standards and compliance, administration and technical support, security, and costs. The information system training will also showcase a software (software sold separately) internally developed by SEDPI and a manual information system to strengthen internal controls.

Governance plays a crucial role in microfinance since this is the key in setting the MFIs’ direction towards reaching their social mission and at the same time achieving financial sustainability. The course will enable participants to identify and delineate roles, duties and responsibilities of the board and management; and determine board involvement and their required knowledge and skills. Best practices in microfinance governance will also be shared in during the training. The course also tackles growth and expansion as an issue that many MFIs face. Participants will be taught how to weigh institutional capacity implications of plans to expand or consolidate microfinance operations. The different challenges in terms of determining institutional preparedness for growth will be discussed, such as developing financial product designs; preventing and arresting or preventing delinquency; achieving financial sustainability; integrity of information systems and controls; adequacy of human resource; and effective marketing of financial products. An appraisal tool will be introduced to enable participants to determine which areas an MFI should address and prioritize.

As a higher level course, the financial management course requires that participants understand financial analysis and are knowledgeable on financial performance industry standards. The course assists microfinance institutions in improving their financial performance through effective treasury management, asset-liability management and liquidity management. The course also includes sessions on projecting an organization’s future financial performance given its current financial performance level. Although the course is heavy on finance, emphasis is given to participants on the danger of mission drift or abandoning their social mission. Actual case studies gathered on field will be presented to highlight current practices of successful microfinance institutions.

This course is designed to assist microfinance institutions in crafting and implementing microinsurance and savings programs. On microinsurance, the course presents the seven basic principles of insurance, and the challenges that microinsurance faces. The course differentiates the characteristics of informal and formal insurance, and the different microinsurance products available. The course also introduces frameworks for assessing the insurance needs of clients and developing relevant microinsurance products. The course also outlines strategies in implementation such as linking up with insurance companies and integrating insurance with other financial products. Meanwhile, savings is discussed as a social service that benefits microfinance clients through consumption smoothening and reduction of vulnerability to risks. At the same time, savings mobilization also benefits microfinance institutions by generating funds for its credit products. In this course, participating organizations will be able to determine whether they are ready to mobilize savings, and what considerations have to be taken in the design process. Finally, marketing campaigns for microinsurance and savings will also be developed.

Effective communications is essential in performing functions as branch and area managers. Conflict is deemed inevitable in organizations. As such, participants must have an understanding of conflicts and learn how to manage them. Manager’s human resource function of enforcing of rewards and penalties on their subordinates will be strengthened with the training course. One of the activities will be a workshop on writing memos. The course will also highlight effective listening and feedback giving.

In microfinance, credit is the main product demanded by low-income clients. It is also the source of an MFI’s largest earning asset – the loan portfolio.  This course starts with the definition and principles of microfinance.  The course also discusses the characteristics of microfinance clients. Various methodologies in the provision of microcredit such as group methodologies with group and individual liabilities, village banking, individual lending, and crowd financing are thoroughly illustrated.  The course also presents character and debt capacity as bases for assessing credit worthiness. Participants will be familiarized to use and understand the rationale behind tools such as the loan application form; credit and background investigation forms; cash flow analysis form; and credit scoring system. The course will also give a preview on how to prevent delinquency. Through the identification of the causes and costs of delinquency, the participants are encouraged to develop policies on how to prevent and mitigate these. SEDPI also shares its vast experience in implementing effective delinquency management techniques during the training.

Delinquency is one of the major challenges that MFIs face. Delinquency Management enables participants to understand delinquency by tracing its causes and costs. Participants are also taught on how to measure delinquency using international standards. The course emphasizes both preventive and curative strategies against delinquency. It also presents research results of common delinquency problems and how successful MFIs have addressed these concerns. The training course includes disaster preparedness and ways on how to mitigate external forces that affect the repayment behavior of clients. Actual strategies implemented by MFIs in these situations are shared during the training.