by Chinq Yee Chong -

MICROCAPITAL.ORG STORY: The International Banking Systems Online Journal Comments On How Key Stakeholders Influence Purchasing Decisions Of Microfinance Institutions In Relation To Information Systems And Includes Observations By Grameen Foundation, CGAP And The Bill And Melinda Gates Foundation

The International Banking Systems publication (IBS), an online journal that provides information on banking systems and operations, have produced a detailed supplement on the role of technological systems in microfinance [1]. An article within the supplement entitled ‘Analysis: Microfinance Stakeholders – Guiding hands’ [2] explores how major stakeholders shape the market for microfinance information systems (MIS). The thrust of the article is that there is an important difference between the microfinance and commercial banking sectors when it comes to information systems and that MFIs depend heavily on key stakeholders such as the Bill and Melinda Gates Foundation [3], CGAP [4], the IFC [5] and GTZ [6] for guidance and direction in making technology decisions. The conclusion arrived at is that ‘directly or indirectly, it is these stakeholders that influence purchasing decisions by MFIs, on the business case for investment, the process of selection, and which products to choose’ in respect of MIS.

by Uyen Tran -

MICROCAPITAL.ORG STORY: Grameen-Jameel Pan-Arab Microfinance Ltd. in Dubai Appoints Julia Assaad as Its New General Manager

For discussion of this topic click here: http://microfinanceassociation.ning.com/forum/topics/gossip-column-human-interest

Grameen-Jameel Pan-Arab Microfinance Ltd. (Grameen-Jameel), a joint venture based in Dubai between the Grameen Foundation and Abdul Latif Jameel Group, announced it would appoint Julia Assaad as its new General Manager [1, 2]. Grameen Foundation is a Washington, DC-based non–profit, and Abdul Latif Jameel Group is a Saudi Arabia-based for-profit business group [3, 5]. Alex Counts, Grameen-Jameel Director and President of Grameen Foundation, stated that Ms. Assaad was brought on to help reach its goal of adding one million new microfinance clients by 2011 [2]. As reported in a previous MicroCapital story on the Arab Microfinance Investment Symposium that took place in November 2008, the Arab microfinance industry has an estimated total market of USD 5.5 billion in the Arab world [13]. Moreover, Heather Henyon, the General Manager of Grameen-Jameel at the time, cited that currently there are 2.9 million borrowers in Arab countries that make up less than four percent of the total demand for microfinance in Arab countries [13]. The untapped market for microfinance is valued at USD 3.96 billion, only slightly less than the USD 5.29 billion that is calculated as the total microfinance market [13].

by Bharathi Ram -

MICROCAPITAL STORY: Lagos State Association of Microfinance Banks in Partnership with Greek Banking Group PROBANK to Create Common Software for Microfinance Banks in Nigeria

The Lagos State Association of Microfinance Banks has entered into a partnership with PROBANK, a Greek banking group, to design a common software for all microfinance banks in Nigeria. According to a press release on Vanguard – Nigeria, the centralized software system would link all microfinance banks in Nigeria and primarily address issues related to the clearing of cheques among microfinance banks. In this regard, the Chairman of the Lagos State Association Mr. Olutayo Adenekan, was quoted thus by the press release: ‘We [Nigeria] always had problems of clearing our cheques among ourselves and between commercial banks’. Mr. Adenekan was also quoted as stating that the aim of the partnership with PROBANK, is to ‘reduce, to the barest minimum, the numerous problems encountered by customers in the various microfinance and commercial banks’. The Lagos State Association is the regional chapter of the National Association of Microfinance Banks in Nigeria; it does not maintain a web presence.

by Zoran Stanisljevic -

MICROCAPITAL STORY: Grameen-Jameel Issues a USD 2.7 Million Local-Currency Guarantee to Aga Khan Agency, First Microfinance Institution (FMFI) Syria

Grameen-Jameel, a social business established in 2007 that serves the Arab microfinance industry, has recently announced that it has issued local-currency guarantee worth USD 2.7 million to Aga Khan Agency the First Microfinance Institution (FMFI) Syria, part of the Aga Khan Agency for Microfinance (AKAM).  The multi-million dollar credit facility focuses to improve the lives of 2,700 underprivileged Syrians through credit, deposits and other financial services.  No additional information regarding how the fund will function is provided.

by Zoran Stanisljevic -

MICROCAPITAL STORY: Grameen Foundation and Women’s World Banking Express Concern Over the Potential Crisis in Punjab, Pakistan’s Microfinance Sector

According to the Business Recorder (a Pakistani Daily Newspaper), the Grameen Foundation (GF) and Women’s World Banking (WWB), recently urged Punjab Chief Minister Mian Shahbaz Sharif to take swift action to support the microfinance sector and help curtail inappropriate interventions by local politicians. While detail regarding the exact cause and nature of the elected representatives’ involvement is currently unspecified, President Alex Counts of GF in Washington DC and Mary Ellen Iskenderian, President and CEO of WWB in New York City, expressed concern. The letter states that heads of the two U.S. non-profit support organizations for microfinance are “concerned that the microfinance sector in Pakistan is under threat. The intervention of some local elected representatives has given rise to a crisis, a situation, which has damaged the reputation of the microfinance sector in Pakistan and could lead to a major crisis with national as well as international implications.”

by Mary Fu -

MICROCAPITAL STORY: IBM Launches 2008 Podcast Series, Features “The Future of Microfinance”

IBM, a multi-national computer technology corporation, announced in a recent press release the launching of its 2008 podcast series, entitled “IBM and the Future of…”. The series, to be updated monthly, presents interviews with thought leaders on the impact of technology on everyday life, as well as on the effects of shifting economics on performance and value. One of the first episodes in the series is “The Future of Microfinance”, hosted by Tim Washer, from IBM’s Corporate Communications, with Jessica Flannery, co-founder of Kiva.org and Kevin Thompson from IBM’s Corporate Citizenship and Corporate Affairs.

by Mary Fu -

MICROCAPITAL STORY: IBM and CARE to Streamline Microfinance in Africa through Grid Technology

IBM, a multinational computer technology corporation, recently announced in a press release that it plans to partner with CARE, a leading private international humanitarian organization, to jointly establish the Africa Financial Grid, an integrated data processing infrastructure that will curb costs currently incurred by microfinance institutions (MFIs) in providing financial services in Sub-Saharan Africa.

by the MicroCapital Team -

New Open-Source Credit Bureau Application Introduced in Morocco

The credit bureau pilot project underway in Morocco is part of a broader open source project, MIFOS, to create a full framework for the industry. The Grameen Technology Center (GTC), a US non-profit in Seattle, has partnered with PlaNet Finance Morocco, a French NGO, to develop and test the program.The project consists of a central database which is sent data from each of the participating microlenders. The client software at the microlender extracts data from multiple data sources (Oracle, Access, etc) and uses a parametrizable SQL statement to pull from the microlenders’ system. In lay terms, the MFI has a tool at their location that allows them to send a standardized set of information to a centralized location. Then, each participant is allowed to make queries of the centralized server to see what customer records exist at other microlenders. (Thanks to James Daily at the GTC for information).Despite the growing preponderance of microfinance institutions worldwide, ways to track credit histories have been inadequate. Even in Latin America, where anywhere from 20-50% of the economically active population is employed in the microenterprise sector, credit bureaus have only recently begun to incorporate information on microentrepreneurs (p. 8). As competition in microfinance lending intensifies, borrower information becomes all the more important (p. 2).

Additional Resources1) Main article discussed in entry: "Model Credit Bureau ‘Open-Source’ Solution Being Tested in Morocco." 2) Grameen Technology Center: "Credit Bureau Pilot Project" 3) Microfinance Matters: "Credit Bureaus in Latin America: Expanding Financial and Other Services to the Base of the Pyramid." 4) Microfinance Open Source (MIFOS) Project5) Inter-American Development Bank (IDB): “Credit Bureaus: Leverage Information for the Benefit of Microenterprises.”