Pres Microfinance Institution Ltd.(Pres MFI)

About Pres MFI

The PCC Molyko is one of the congregations of the Presbyterian Church in Cameroon (PCC) located in the South West Region of Cameroon. Presbyterian MicroFinance Institution Limited (PRESMFI) is an approved category 2 microfinance institution owned by the PCC at Molyko Buea. Pres MFI caters to the local population church hierarchy, pastors, christians and the general public offering aid/solution to all their financial needs.

Challenges
Solutions
Results

Manual – Still doing most of the operations manually
Multiple Systems – Handling multiple systems and they are not communicating each other
Scale up – Unable to scale up their business with different products
Monitoring the clients in remote place

Allowing end customers to access their accounts(performing transaction as well as viewing) through the Mobile application
Salary transfer, school fee payment option for end customer
A complete loan management system with charges and tax
Loan officer mobile app implementation for ease of customer service
Role wise definition of user powers to effectively implement organizational policies
Dashboard implemented to give a snapshot of the entire book(Asset and Liabilities)
Trigger and action based SMS and email setup
Able to accommodate new financial products like Seasonal loans for employees in private sector, Equipment loans, Housing loans

300% increase in Client acquisition
200% increase in Deposit accounts
Enhanced customer experience and ease of transaction by providing end user access to the account through the mobile application, SMS and email communication
Able to acquire new customers by introducing new financial products
Increased revenue through salary transfer and school fee collection feature implementation
Reports and Dashboard to monitor and take course correction when necessary

After smartphone penetration, people are not watching their SMS at all. They use SMS only for OTP related transactions. That’s it.

But What can a Lender see in your SMS after you consent to them?
Lender can see income, expenses, and any other Fixed Obligation like (EMIs/Credit Card).

1) Income – Parameters like Average Salary Credited, Stable Monthly inflows like Rent

2) Expenses – Average monthly debit card transactions, UPI Transactions, Monthly ATM Withdrawal Amount etc

3) Fixed Obligations – Loan payments have been made for the past few months, Credit card transactions.

It also tells the Lender the adverse incidents like
1) Missed Loan payments
2) Cheque bounces
3) Missed Bill Payments like EB, LPG gas bills.
4) POS transaction declines due to insufficient funds.

A massive chunk of data is available in our SMS (more than 700 data points), which helps Lender to make a credit decision.

#lendtech #fintech #manispeaksmoney

An interesting insight on vehicle loans for lenders.

A trend we are seeing today – the first-hand vehicle ownership is decreasing with time. Why? People are upgrading their vehicles in every few years because of technological advances. And, this can be seen more with the millennial generation.

So, what should a lender do in terms of financing?

– Estimating the residual value of the vehicle at the start of the financing period.
– Charging a borrower only for the residual value (which is the difference between the value after a few years and the current value)

Example: A bike currently is INR 1 lakh. You want to buy the vehicle for 2 years. A lender will estimate the residual value of that bike today and what it would be after 2 years. If the estimated residual value = INR 45,000, the lender will charge you only that (say, INR 55,000 with interest for this instance) during your tenure.

At the end of 2-year period, you have 3 choices:
1. Return the bike and upgrade to a new one without going through the struggle of selling it.
2. Pay the lump sum remaining amount to own the vehicle outright.
3. Extend the financing and own it by keep paying the EMIs for the remaining amount of the vehicle for the next 12 or 18 months.

Benefits for the borrowers?

– Flexibility to use a vehicle and upgrade to a new one.
– Affordability to not pay for the complete value of the vehicle with the intention to use for a lesser amount of time.
– Convenience in owning the vehicle.

Say goodbye to the old lending option and embrace the new way of financing for vehicle by lenders!

#vehiclefinancing #vehicleloan #lending #manispeaksmoney

How many of us know this?

1) Tiktok does Lending ( is it an entertainment company or social media company or a fintech company?
2) Youtube China does Lending
3) Top 100 internet companies in China(no matter what business they are in) do Lending

The team which was heading Lending in Tiktok was the Advertisement team. If we do Ads, we do X no of revenue. But if we do lending, we’ll get X+30% more revenue. This is on the same Ad spot.

Ad team has transformed into a lending team, and in today’s world, it’s possible because the subject matter expertise can be put in as an API and given to you.

Embedded Lending as a service is becoming popular in India too, and I am happy to be part of this ecosystem.

#lendtech #fintech #tiktok #manispeaksmoney

In India, has everybody access to loans?

The answer is No. Only the top 10 crore people have access to many credit products in India. Almost all Banks focus on this market.

Once you go beyond that, the credit access rate has dropped significantly due to multiple factors.
1) Customers who are having low income(30-40K per month)
2) Not earning from an employer who belongs to Category A or B
3) Not from Tier 1 or 2 cities

NBFCs and Fintechs focus on the above segment, pushing another 10 crores of people.

But in India, 70 crores more people are formally or informally employed, which still needs to be tapped.

#manispeaksmoney #digitallending