SUCCESSFUL  SAVINGS  MOBILIZATION  Julie  Peachy  

Grameen  FoundaAon    

2011  RBAP-­‐MABS  Regional  Roundtable  Conference  Hya=  Hotel  &  Casino,  Manila  

November  9,  2011    

Successful�SavingsMobilizationMobilization

Julie�PeacheyMicrosavings Initiative�Project�Managerg j gGrameen Foundation

MABS�Roundtable,�Manila,November�9,�2011

1

Agenda

O i f GF/CARD B k S i M bili ti• Overview�of�GF/CARD�Bank�Savings�Mobilization�project

• Keys to successful savings mobilization:Keys�to�successful�savings�mobilization:– Holistic�Approach�to�Product�Development– Data�analytics– Human�Capital– Business�modelCARD B k i il t lt• CARD�Bank�savings�pilot�results

• Conclusion

2

Grameen Foundation’s Microsavings InitiativeGrameen�Foundation s�Microsavings InitiativeA�threeͲyear project�aimed�to�reach�

1 45 million new savers in:1.45�million�new�savers�in:

( hili i ) ( di ) ( hi i )(Philippines)�����������������������(India)�����������������������������(Ethiopia)

Our holistic approach helps offer secure, convenient povertyͲOur holistic�approach�helps�offer�secure,�convenient�povertyfocused�savings�programs,�while�building�sound�financial�and�institutional�practices�that�transform�MFIs�from�creditͲled�to clientͲfocused demandͲdriven financial institutionsto client focused,�demand driven�financial�institutions

Funded�by�the�Bill�&�Melinda�Gates�Foundation

Our approach to microsavings implementationOur�approach�to�microsavings implementation

1 M k h &1.�Market�research�&Product�Design

2.Marketing & financial2.�Marketing &�financial�literacy

3.�Enabling fieldͲbased�transactions throughtransactions�through�alternative�delivery�channels

4.�Building�institutional�capacity

CARD�Bank�OverviewProfile

• CARD�Bank�(1997)�is�a�microfinanceͲoriented�rural�bank�(part�of�CARD�MRI;�1986)

• Largest�MFI�(together�with�CARD�NGO)� ghlights • Savings�Products

• Main�product�=�Compulsory�account�with�option�to�save�more

ARD�Ba

nk�

in�the�Philippines�when�measured�by�number�of�active�borrowers,�gross�loan�portfolio,�and�total�assets;�1600�employees ro

ject�Hig • Regular�savings�and�time�deposit

• Challenges:• Development�of�marketing�function�and�longͲterm�strategic�

CA • Organization�owned�and�overseen�by�members;�offering�voluntary�savings�since�1997;�moved�from�group�to�individual�lending�in�2003

P g gmarketing�plans

• Delivery��Model�and�Business�Case• Implementation�of�new�core�banking system ATM technologies• Current�outreach�for�savings:

• 45�branches• 242�Micro�Banking�Offices�(MBO)• 500k active voluntary savers

banking�system,�ATM�technologies• Change�Management

• 500k�active�voluntary�savers

Holistic�Approach�to��Product�Development�• Example�of�product�

development�lifeͲcycle�for�savingsNew�Product�

RollͲoutR ll t PMarket�

• Incorporating�institutional�capacity�across:

– IT

RollͲout

Institutional�Assessment

RollͲout�Prep;�Product�

Marketing�&�Promotion

Customer�S t ti

Segmentation

PPI

Financial�Literacy

IT– Training– HR�and�Change�

Management

Evaluation�of�Pilot

Segmentation�and�Targeting

RegulationsCosting�&�Pricing

ITHRProject�

Data�Analytics

Market�Research

– Finance�– Costing�and�Treasury�Management

– Internal�Controls,�l di

Develop�Product�Concept

Pilot�Test�Preparation;�

Financial�Projections

ITHR Management

Internal�Audit– Marketing– Financial�Literacy– Social

Process�Mapping

Costing�&�

Field�Test�and�Adjust Internal�

Controls

Training

Finance

Social�Performance�Management

gPricing Treasury�

Mgmt

6

Market�Research:�Accessibility�is�often�valued�more�than�any�other�savings�product�attributep

0 ib f S i d10�Important�Attributes�of�Savings�ProductMay�2010�CARD�Bank�Market�Research

CARD�Bank�Savings�Delivery�Model��������

Pilot�Savings�Product�ͲMatapat• Delivery Channels offeringDelivery�Channels�offering�

savings�services:– Center�meetings�and�MBOs�

– Deposit�collection�by�Savings�Associates�and�in�center�collection�sheet�

i hd l h h

SavingsAssociates

Account Officer

pilot branches only

– Withdrawal�through�ATMs�

– Bank�branches

• Dedicated Customer ServiceDedicated�Customer�Service�Associate�based�in�Bank�branch�General Public

Existing Members

CARD�Pilot�Test�Findings• Primarily�for�the�education�of�children�and�emergency�needs

• Extra�funds�for�daily�needs�and�utilitiesWhy Save?* • Additional�business�capital• Separate�savings�aside�from�Compulsory�Account�(for�members)

Why�Save?

• Convenient�withdrawal�transactions• Deposit�Collection�(SA�and�SMS�Hub)• Low�maintaining�balance

Why�Matapat? • Privacy�of�Savings�compared�to�Compulsory�

Account�(for�members)Matapat?

• 43% have not yet used their savings• 43%�have�not�yet�used�their�savings• Savings�were�used�mostly�for�additional�business�capital�and�unexpected�events

• Other�usage�includes�education,�daily�needs,�

What�is�savings�used�

f ? utility�and�debt�payments.for?* Same reasons as given in initial market research

Data�Analytics:��The�poor�can�save

Correlation�between�poverty�score�and�saving�

At CARD Bank, we did not find

Exchange�rate�=�

balances�=�.20a correlation between poverty level* and savings

43.1�PHP/USD

N= 84 735

and savings balance

N �84,735(top�1%�removed�due�to�outliers)

More�poor Less�poor

*Using GF’s Progress out of Poverty Index tool

The�Role�of�Human�Capital�Mgmt

Structure�and�Job�

Descriptions

Skills�Gap�Analysis

Rewards�&�Incentives

Supporting�M h i

AnalysisIncentives

Mechanisms

Recruitment�Performance�and�Selection

Learning�and�

Targets

gDevelopment

11

Business�Model

• Costing�exercise�completed�in�June�2010�and�again�June�2011�including�results�from�the�g gpilot

• Actual�costing�of�all�17�products�(savings�and�l ) i h h f dloan)�using�6�months�worth�of�data

• Initial�projections�d f h ildone�for�the�pilot�product�– Matapat

• Scenarios for full• Scenarios�for�full�time�or�part�time�Account�Officers�

12

for�savings.��

Human Capital Management 4,193�PHP�7,519,188�

PHP�7,000,000�

PHP�8,000,000�

4,000�

4,500�

Matapat�Product Ͳ #�of�accounts�and�savings�volume�January�2011�to�September�2011�source�Datamart

Structure�and�Job� PHP�5,800,097�

PHP�6,000,000�3,500�

Descriptions

Skills�Gap�Analysis

Rewards�&�Incentives

2,977�PHP�5,024,740�

PHP�5,103,862�

PHP�5,573,122�

PHP�5,000,000�3,000�

Supporting�Mechanisms

AnalysisIncentives

2,158�

2,590�

PHP 3 148 229

PHP�4,000,000�2,500�

Matapat�accounts

Recruitment�and�Selection

Performance�Targets

1,724�PHP�2,520,054�PHP�2,745,749�

PHP�3,148,229�

PHP�2,000,000�

PHP�3,000,000�

1,500�

2,000� Matapat�Volume

Learning�and�Development931�

PHP�1,852,712�

PHP�1,000,000�1,000�

13

641� 721�799�

PHP�Ͳ500�Jan�2011' Feb Mar Apr May Jun Jul Aug Sep�2011'

Conclusion• Effective�Savings�Mobilization�requires�involvement�

f h• Special�focus�on�the�

following is key:

of�the�entire�organization

following�is�key:– Disciplined�product�development�process

– Data�Analytics…�understand�your�customers

– Human�Capital�Mgmt�practices�to�effect�Changeg

– Business�case….�understand�your�costs 14

Thank you!Thank�you!

15

CASHPOR�Business�Model�Overview

• CASHPOR�will�act�as�the�BC�agent�to�ICICI�Bank

• Eko�Technologies�will�provide�the�technology�solution

• CustomerͲowned mobile handsetsCustomer owned�mobile�handsets�along�with�CASHPOR�agents�to�perform�transactions�

• Loan�business�uses�Loan�Officer,�SCSPLocated at CM

6 pilot branches only

MobileͲbased�application�from�ATOM�Technology.

• CASHPOR�Delivery�Channels�are:�

the branch CM (CSP)

– the�branch�for�new�customers�that�are�not�CASHPOR�loan�clients

– Center�Meetings�for�existing�CASHPOR�loan�clients

Non Clients Existing Members

Cashpor India:�The poor demand formal savingsThe�poor�demand�formal�savings

Learn�more�at�www.grameenfoundation.org