Management Information System for Community Based Financial Institutions

1
Management Information System for Community Based
Financial Institutions

• The MIS Software should be able to manage multi
  level requirements
• SHG Level - MIS FA
• Federation Level - MIS FA
• Apex Level - MIS FA

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Management Information System for community based
financial institutions contd..

• The software should be able to generate the
  reports separately at each level as well as
  consolidated reports.
• Trial balance
• Financial statements (Income and Expenditure
  balance sheet etc)
• Cash flow statements
• Portfolio reports - aging analysis
• Demand collection balance reports
• Ratios - trend analysis

3
Issues related to adaptation by CBFIs

• Needs are very different from one MFI to another
• Changes in the needs of information as business
  changes and new opportunities arise
• Development of such software is complex and
  costly
• MFIs are not ready to adopt changes as per
  software and are afraid of disclosing the
  financial data
• Ambitious requirements of MFIs
• The multi sector project implementation of NGOs
• Availability of accurate data
• NGO staff find setting the data very laborious
• Lack of combined skills in mF, accounting and
  computers in NGO-MFI staff.
• Data entry and maintenance of accounts done by
  different persons

4
Issues with software providers

• Could not provide on site technical support
• Inadequate training to staff
• Techniques for trouble shooting
• Communication gaps between implementers and
  providers
• Not able to handle the required customization due
  to complexity of diverse products and lending
  methodologies
• Could not generate required reports
• Lack of timely support, HR constraints and
  monitoring support
• Could not provide quality services
• Operational issues
• Could not provide Handholding support

5
Precautions while choosing a software

• Choose a provider who is available closer to the
  operational area
• Negotiate for separate costs of installation and
  customization
• Differentiate between customization of software
  and handholding support
• Tie the support in a time-frame of delivery
  inclusive of customization and hand holding
• Release payment on the basis of performance and
  satisfaction of implementers
• Post installation support
• Ask for a User friendly manual

6
Precautions while implementing the software

• Regular check should be undertaken from time to
  time of the data entry and its quality
• Regular follow up
• Storage and backup of data
• Simultaneously maintain the manual system for 6
  months
• Backup and continuity systems
• Continuous flow of information
• Regular check of financial reports and analysis
  for making it online and making improvements if
  required.

7
Issues related to limited budget to support the
software

• Installation of the software is supported by the
  donor but not the post installation support.
• The support costs involve more than 60 of the
  software cost.
• Maintenance of hardware and software costs
• Could not hire skilled HR in view of budget
  constraints

8
Measures undertaken to overcome the data
collection/entry difficulties

• A prescribed format was developed to collect the
  initial data and for regular transactions
• Internal audit team identified from amongst the
  NGO staff to conduct audits of all the SHGs and
  MACS to arrive at closing balances
• To make collection of information easier the Book
  keepers and community organizers have been
  trained on SHG audit and filling the formats.
• NGO staffing structure was modified to ensure
  continuous information flow and to establish
  monitoring systems at all levels
• Staff JDs issued which clarifies the roles and
  responsibilities

9
Organizational structure
10
Usage and analysis of MIS

• In an NGO, the management often has very little
  time and skills to understand the usage of
  analysis of MIS Data for decisions.
• The culture of financial management is difficult
  to achieve.
• Though the management understands its relevance,
  its reluctance for hands-on analysis keeps it
  away from proper use of MIS.
• Sharing of data analysis to SHGs/Federations

11
Measures taken to overcome usage of MIS and
analysis by CBFIs

• Trainings on book keeping, financial management
  and delinquency management were provided to MIS
  coordinators, PCs, TCs and other coordinators.
• Advance level trainings in financial management,
  delinquency management, risk management and
  interest rate setting were given to the
  Coordinators and CEOs of the NGO-MFIs.
• Currently, all the reports are being routed
  through the CEOs to understand its relevance and
  proper use of analysis.

12
Sample Reports generated through software package
being used by one of the CASHE partner
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