Voluntary Saving Mobilization as a Service for the Poor and a Source of Funds for Regulated MFIs. Marguerite Robinson HIID Institute Fellow Emeritus March 20, 2001 Washington, D.C. Some Basic Principles for MFIs in Large-Scale Savings Mobilization (L-SSM).
Voluntary Saving Mobilization as a Service for the Poor and a Source of Funds for Regulated MFIs
HIID Institute Fellow Emeritus
March 20, 2001
1. Study international experiences
2. Appropriate macroeconomic conditions, regulatory environment and supervision capacity
3. Financially sound institutions:
4. Full-time high-level management resources made available
5. Conduct demand research
6. First Pilot Project
7. Pilot Project assessment and revision
8. Second Pilot Project if necessary
9. Monitor pilots and train trainers for expansion
10. Expand gradually to all branches, training staff in each location
11. Systematic Approach to savings mobilization and staff incentives for performance
12. Market penetration
Penetrating the Market
All loans funded by unit savings
Expansion to All Units
Stages of Development and Performance in BRI’s Unit Desa Savings Mobilization Program
1984 - 1996 (in millions of US Dollars)
* SIMPEDES (Rural Savings): 17,600,517
* SIMPEDES (Rural Savings): US$1.23 billion
US$1 = 9700 rupiah (December 31, 2000)
Is Mobilizing voluntary microsavings too expensive for sustainable MFIs?
Answer: If the institution is trustworthy and provides savings services appropriate for their needs, poor people generally do not require high interest rates.
Answer: This argument is correct. However, the problem is solved when savings are collected from the public. Savers with higher account balances cross-subsidize those with small account balances.