Microfinance Partners at Agoo, La Union, Philippines

Simplicity is Best in Microfinance


KISS it!

Keep It Simple, Sam. (The name just popped out from somewhere, so please bear with it but ‘Sam’ can be a woman’s name or a man’s name.) I used ‘Sam’ because I don’t want to call you ‘stupid.’

Business is simple. We just make it complicated for whatever reason we know.

“Most business can be done simply and microfinance is not an exemption to that”, my mentor once told me, pronto. There may not be gracefulness in all aspects but neither they are complicated.

Doing business is just that simple, Sam.

Just recently, some newly hired personnel came to my branch for exposure. They are groomed to manage 3 branches to be opened soon by our organization. One common reaction directed to me was ‘how to simplify the ways of microfinance?’

Well, I only showed them the basic of Area Mapping, Client Targeting, Group Formation, Client Motivation, Loan Monitoring, Installation of Management Information System and of course, the application of all these essential elements of microfinance to ensure Credit Discipline. They were overwhelmed and found microfinancing as a complicated business.

We never discussed how to do PEST Analysis and Market Analysis. I just offered them the tenets of microfinancing.

My answer?

Just do the basics and keep it simple. That’s it.

How simple is that simple?

If your business is restaurant, the basic is to serve as many meals as you can. You may add some ‘value’ to your service but the basic is: serve as many meals per hour. In a hotel business, fill all beds with satisfied guests.

In microfinance, serve as many outreach you could manage.

Just leverage this simplicity and forget all other issues like whether you are for profit or not profit. Leave the debate for those who have time for those issues.

Do it simple and do remember: oftentimes, simplicity wins.

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So long…

Florentino

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