Digitalization in Financial Inclusion

Digitalization of microfinance is one of the strategic topics of the Microfinance Centre. We actively support microfinance institutions and other responsible finance providers in applying new technologies and fintech solutions for better outreach to the excluded and vulnerable clients, improved social outcomes and more efficient operations. In 2018 and 2019 more than half of our members introduced digital innovations.

MFC Tools

DRSAT – Digital Readiness Self-Assessment Tool 

The DRSAT helps MFIs to assess their ‘digital readiness’, that is the ability to implement large-scale digital initiatives. By identifying digital challenges and opportunities across both internal and external aspects of the business, MFIs will be able to make smarter decisions and implement meaningful digital initiatives. Using the MFC’s digital readiness self-assessment tool (DRSAT), MFIs can mobilize people across departments to build consensus around digital strengths, weaknesses, and gaps. Assessment results can also be used to inform digital strategy development and build a detailed roadmap for digital transformation.

The DRSAT is available in English and Russian.

MFI’s client digital financial service readiness

Financial institutions introduce new technological solutions for interacting with their clients and digitalization of the customer experience is trending now. While for many clients this means better quality of interactions with the financial institution (in terms of time and effort), for the others it is an unwelcome change. It is crucial for each financial institution to learn about their clients’ digital capabilities, behaviors, presence in the cyberspace as well as their needs for more tech interaction before embarking on the digitalization journey.

Thr Microfinance Centre, supported by its members, is developing a set of qualitative research tools to support MFIs in conducting client research. Read more

Financial health online tools

Financial Health of Individuals

Financial Health of Microenterprises

  • Scorecard (under construction)

Knowledge sharing

Publications

 – MFC publications

“Experimenting with Digital Solutions: Initial Lessons from European Microfinance” – The case study reviews digital applications and experimentation in digital transformation of EU MFIs. Using a digital transformation framework developed by the Microfinance Centre, it examines the application of technology to core business processes and analyses MFI experience in using various applications such as social media, virtual collaboration, mobile tools, data analytics and artificial intelligence.

“The Tech-and-Touch Mix in Microfinance” – The case study considers how MFIs in Europe incorporate high-tech solutions with a traditional high-touch approach to provide microfinance services, and discusses emergent models to combining the two approaches.

“Riding the Technology Wave in European Microfinance: the Case of Qredits”  traces the origins and the digital evolution of Qredits, a Dutch microfinance foundation which is the only national program providing an alternative source of funding to new- and early-stage businesses.

“Digitalizing Microfinance in Europe” -summarizes the results of the survey on the use of fintech solutions and digitalization of the customer relations and lending process among MFIs in Europe.

 – External resources

Financial Inclusion in the Digital Age – the report by the IFC, CreditEase and the Stanford Graduate School of Business highlights some of the central frictions that prevent greater financial inclusion and financial well-being, and associated technological innovations that are fostering creative new approaches to mitigating these frictions for individuals and small businesses globally.

Digital Pathways in Financial Inclusion draws on the technology initiatives of the winners and semi-finalists of the 2018 European Microfinance Award on ‘Financial Inclusion through Technology’, paving the way for how advances in technology can be adopted by financial services providers who serve the excluded.

BFC’s weekly FinTech Bulletin with the news of the FinTech industry by BFC Consulting.

Conference presentations

MFC is actively supporting social finance providers in their digitalization journey by offering space for learning, exchange of practices as well as creating linkages with fintech companies.

In 2019 the following topics were covered:

Webinars

MFC has been regularly organizing webinars during which MFC members and industry experts share their experience in digitalizing their operations.

 – MFC webinars

 – External webinars

Discover more at MFC Library

Digital Academy

Currently, MFC is developing a new service for microfinance institutions called Digital Academy. It will provide learning opportunities for MFI managers. Webinars will cover the following topics:

  • Digital profile of the customer
  • Digital presence and effective customer acquisition
  • Digital customer service and value add
  • Digital operations
  • Digital capabilities and agile way of working
  • Regulations supporting digitalization

Digital Literacy Bootcamp

Together with digitalisation experts, MFC kicks off the Digital Literacy Bootcamp – a series of practical webinars for practitioners of senior and middle level in MFIs. The experts will help participants to understand a landscape of digital practices and solutions, helping in customer acquisition, improving clients engagement and increasing efficiency. The knowledge gained will allow participants to further explore the topic, allowing right partnerships and preventing unnecessary spent funds. The first webinars start in early October – check out #DigLit Bootcamp here

Exploring the potential of the fintech sector

Since the beginning of 2018 MFC has been engaged in research on the role of the fintech sector in improving financial inclusion and financial health of vulnerable groups of population and microentrepreneurs. The project highlights the opportunities for furthering the engagement of fintechs in financial inclusion/financial health and potential for partnerships development between new entrants and the incumbents. The focus is on fintech companies offering products/services directly to vulnerable and excluded groups – self-employed, micro-enterprises, migrants, individual farmers, self-employed and micro-entrepreneurs and fintech companies offering digital solutions for the traditional financial institutions.

Fintechs and financial inclusion and financial health – summary of findings from six county studies. (upcoming)

FINTECH MARKET IN POLAND

A review of the current state of the fintech sector, and its potential for contributing to financial inclusion and health in Poland. (upcoming)

FINTECH MARKET IN UKRAINE

A review of the current state of the fintech sector, and its potential for contributing to financial inclusion and health in Ukraine. (upcoming)

FINTECH MARKET IN TURKEY

A review of the current state of the fintech sector, and its potential for contributing to financial inclusion and health in Turkey. (upcoming)

FINTECH MARKET IN THE UK

A review of the current state of the fintech sector, and its potential for contributing to financial inclusion and health in the UK. (upcoming)

FINTECH MARKET IN CZECHIA

A review of the current state of the fintech sector, and its potential for contributing to financial inclusion and health in Czechia. (upcoming)

FINTECH MARKET IN THE NETHERLANDS

A review of the current state of the fintech sector, and its potential for contributing to financial inclusion and health in the Netherlands. (upcoming)

Consulting services / other offers

Business & Finance Consulting (BFC) featured digital services: