CENTRE FOR SELF-HELP DEVELOPMENT

Institute of micro-finance and cooperative development.

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West Meets East: A Practice of Learning from Each Other

In the last two decades microfinance in Nepal has taken a big leap forward in terms of the number of institutions providing loans, volume of loan transactions and the number of client members. In the beginning, microfinance practitioners in Nepal had learned from Bangladesh but now microfinance institutions can learn new innovative business practices, client friendly schemes, and other credit plus activities from one another within the country. Observing clients’ enterprises and practices, they can learn new tools and techniques of financing. Towards this end, the Centre for Self-help Development (CSD) has been organizing in country visits regularly.

This year, CSD organized a high level MFIs officials' study/exposure visit “West Meets East” Program from January 22 to 28, 2023 to observe the good practices of the microfinance members and microfinance institutions of Eastern Nepal and learn from their experiences. A total of 13 representatives of 8 microfinance and cooperative organizations of western part of Nepal including some representatives from Bagmati and Madhesh Province had participated in the visit.

They had begun the visit program from the Mahuli Laghubitta Bittiya Sanstha Ltd. and the Shrijanshil Laghubitta Bittiya Sanstha Ltd. of Madhesh Province. During the visit, the team also observed the clients' businesses of the Nerude Laghubitta Bittiya Sanstha Ltd., the Jeevan Bikas Laghubitta Bittiya Sanstha Ltd., the Navodaya Multipurpose Cooperative Ltd. and the Sahara Nepal Bachat Tatha Rin Sahakari Sanstha Ltd.

In Jhapa the Sahara Nepal SACCOS has been instrumental in developing pocket area for raising enterprises such as livestock, dairy, bee-keeping and providing not only financial support but also technical services through its own technical staff. It has also made arrangement for the marketing of the products so that members could get fair price for their products. Sahara has aimed to make Jhapa district self-reliant in meat, dairy and honey production.

During the discussion with the Jeevan Bikas Laghubitta Bittiya Sanstha Ltd. (JBLBSL), the participants got acquainted with the use of digital technology in microfinance. In the presentation Mr. Sanjay Kumar Mandal, CEO of JBLBSL explained that JBLBSL has been conducting major official work such as reporting, record keeping, documentation, monitoring of staff and centres through digitalized system. JBLBSL has online customer care, real time grievance handling mechanism and digital technologies like Jeevan Bikas Digital App, GPS, Human ATM etc.

The visiting team also got information on Human ATM under Biratnagar Rani Centre of JBLBSL. Under this project JBLBSL has formed a digital member who can provide loan, collect installments and savings as well as provide utility payment services digitally like an ATM with the account code that members have. The members also can do all their debit and credit transaction physically with the digital members via their own account. All records of Human ATM will be processed at real time and all of the transaction by the digital member has been tracked in the digital system. The digital member who use his/her money and account for this service get paid 0.5 percent of every transaction.

Mr. Mandal express that the digitalization has brought transparency, effectiveness of the services, and efficiency of the resources. He also said that JBLBSL has started Progress Out of Poverty Index (PPI) to know the status of the members and provide better services.

The visiting team was also acquainted with the programs such as energy loans, self-employment loans, and technology loan as per the needs of the target group. Besides that the team was observed and informed about the credit plus program for the members and supports under the corporate social responsibility requirement of the MFIs and Cooperatives in the eastern Nepal. They are supporting on health, education, settlement of the poor families and other social activities for the senior citizens, cultural preservation, and disaster management, for which they are collaborating with INGOs, NGOs and Community Based Organizations along with local governments.

During the review program, the team members said that the visit helped them a lot to learn about the innovative program of the MFIs and Cooperatives. In addition, the team decided to follow a 13-point way forward for their actions.

Way forward of the West Meets East Program
1)  Keep updated profiles of employees in every branch with photos.
2)  Create a PDF file of the organization's policies and procedures and keep them in Core Banking System (CBS).
3)  Arrange CCTV cameras and Biometric Attendance in all branches.
4)  Implement Progress Out of Poverty Index (PPI) process to measure the state of clients.
5)  Start evaluation of employees in the Core Banking System and reward 3 employees in every 3 month.
6)  Pinpoint center meeting place in GPS system and upload it in the Core Banking System.
7)  Educate the staff on the formation of Three Zero Club among students and children of the members.
8)  Implement entrepreneurship development program as a campaign.
9)  Encourage to form group based enterprises and support them technically and financially.
10) Set up a grievance hearing unit and make necessary arrangements for its free and fair operation.
11)  Implement Environment Friendly Self-reliance Village Development program with priority.
12)  Conduct loan appraisal and utilization checks effectively through online system or manually.
13)  Address in time the relevant issues raised by the Struggle Committee of the clients.

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