This document summarizes the trends and challenges facing microfinance over the next decade. It discusses how rural banks need to adapt to changing client preferences by offering more services and increasing accessibility through new channels. Rural banks are facing competition and issues of over-indebtedness among clients. Regulators support microfinance through new regulations that create opportunities in housing, agriculture, microinsurance and e-money products. Branchless banking and improved channel management, such as partnering with merchants, can help rural banks expand outreach while reducing costs and increasing convenience for clients.
2. Panel Discussion
1) Market Issues Faced by Rural
Banks
2) Challenges of Competition & Client
Over-Indebtedness
3) Regulations that Support the
Transition to Next Practices
4) Branchless Banking & Channel
Management – Reimagining
Microfinance for Rural Bank Clients
3. Market Issues Faced by RBs
Clients want more Banks need broader
services range of services
Clients want Banks need to make
convenience banking services
more accessible
Clients are more Banks need to
cost conscious reduce costs for
clients
Outreach via new
New clients/markets
channels
4. Market Issues Faced by RBs
Changing micro/ Market Intelligence
macro environment
Human resources Need to keep staff
trained and
incentivized
5. Challenges of Competition &
Client Over-Indebtedness
Banks need to improve their market position
Banks need to look at new markets and new
clients
Need to improve transparency & consumer
protection
Financial Inclusion = Need to Financial
Education
Credit information sharing in the sector is key
Better underwriting practices
Stricter enforcement of zero tolerance
6. Regulators support microfinance
Regulators are more open to banks in
microfinance but stricter
Banks need proper methodology and clear
underwriting policies
Better risk management systems (PAR
monitoring)
Proper governance practices especially for
NGOs that are now MFI banks
7. Regulators support microfinance
New regulations create opportunities
Housing Microfinance
Agri Microfinance
Microinsurance
E-Money Products & Services
Channel management
New future areas to watch
Review on Other Banking Offices
Definitions of Micro Loans vs. Unsecure Loans
Definition of Microfinance
E-Money Platforms/Operations
Consumer Protection
Credit Information Reporting