MFC Membership Meeting

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MFC Membership Meeting 9 June 2006 Budapest,
Hungary
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Meeting Agenda

• Welcome
• Activities report for 2005 and 2006 highlights
• MFC financials in 2005 and 2006 budget highlights
• Evolving MFC membership discussion on the
  members
• vision of the network

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2006 Highlights

Social Performance Management launched
Financial Education project completed 34
training and consulting assignments Central Asia
Centre became operational Membership grew from
84 to 96 members 8th conference in Bucharest was
attended by 400 participants Award received from
AMFI Bosnia for the exceptional contribution in
development of the microfinance sector in Bosnia
and Herzegovina
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Strategic Initiatives and Programmes

• Low levels of financial literacy
• Gaps in MFI Capacity, Skills

Clients

• Promote financial education

• Build MFI Capacity
• Promote social performance

MFIs

• Enhance Funding Effectiveness

• Funding Distortions, Inefficiencies

Funding

• Increase Support Organization Capacity

• Underdeveloped uncoordinated support sector

Networks Support Orgs

• Improve data info flows
• Encourage forward-looking culture

• Inefficient uncoordinated data information
  flows
• Cultural Issues

Marketplace

• Create an Enabling Policy Environment
• Promote Sector Awareness

• Poor policy environment
• Low awareness of MF micro enterprise sectors

Macro-Environment
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Training and Consulting in 2006
34 training and consulting assignments 617 MFI
staff trained 3,073 MFI staff trained since
MFC inception Conducted second CAMEL
Assessment under the ACCION supervision
ToT for MFC trainers to offer the ILO
course for middle and senior
management Making microfinance
work

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Training and Consulting in 2006

HRM, LPM, BP for FINCA Azerbaijan   STM course
for Macedonian MFIs   HR, ORM, BP, CA for AMFA
  LO for UNDP in Srebrenica  
ILO MMW in Macedonia   MIP (ILO) in Albania   HRM
transfer to Sanabel
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Number of TC Assignments by Years
52

44
40
34
28
15
9
5
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Challenges in 2005
Lack of funds for the development of new
products Cancellation of open enrollment
training courses in Eastern Europe Change
in staff and management
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Action Research
Advancing Social Performance in the Region

• 1 18-month action research project in
  cooperation with Microfinance Opportunities,
  MicroSave, ImpAct and ForoLac aimed at developing
  and pilot-testing protocol for developing social
  performance strategy and its operationalization
  through balance scorecard (financed by the Ford
  Foundation)
• 2 3-year technical assistance building program
  involving 6 regional
• MFIs aimed at developing social performance
  management
• systems (financed by ICCO)
• 3 Regional delivery of finalized Social
  Performance Management
• Training and establishment of regional
  working group on social
• performance (financed by IFAD)

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Action Research
Advancing Social Performance in the Region

• As part of component 1, the training Strategic
  Planning for MFIs was
• developed. The protocol test and refinement took
  place at
• Prizma in October 2005
• Imp-Act/MFC Guidelines for SPM were finalized
• and published
• MFC developed training course Social Performance
  Management was
• revised in cooperation with ImpAct Secretariat
• Delivery of the revised version of the Social
  Performance Management
• training at World Vision International Summer
  School in London in July
• 2005
• Presentation of the MFC social performance
  related work at the launch of
• the Global Working Group in Social Performance
  (Paris meeting, March)

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Financial Education
FUTURE
NOW
FINANCIAL EDUCATION
Long-term financial planning Tendency to live day
by day No habit to make long-term plans
Sets and pursues long term goals
Systematic saving No systematic approach to
saving.
Regular and targeted saving practices
Reactive risk-management No preparation for
risks. Reactive borrowing in response to risks.
Use of proactive approaches to risks
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Action Research
Financial Education
The training tool was developed and tested 10
local trainers 28 groups in 6 provinces 262
participants completed 82 retention rate The
final package (including the training course,
trainer notes and materials) was
developed Development of
strategy for the

2nd part of the Financial Education
project
Regional dissemination
disscused
for Bosnia and Russia

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Action Research
Transparency and data collection
Data from 68 MFIs collected, analyzed and
submitted to MIX (annual target for 2005 65
MFIs) Regional mapping study update for 2004
completed Training course on MFI monitoring and
benchmarking conducted in Armenia (August) and
for RMC (in September)

Reports published Benchmarking
Microfinance in ECA Georgia Benchmarking
Report Support extended to 2004 Romania
Benchmarking Report Project was launched to
introduce performance monitoring of IFAD rural
finance portfolio in the ECA region (funded by
IFAD) MFC assisted CGAP in reviewing candidates
for the CGAP Transparency Awards
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Action Research
Co-operation with MicroSave

Development of the toolkit Quantative Research
for Microfinance Development of the training
Quantative Research for Microfinance Revision
of the MicroSave developed training course
Market Research for Microfinance Revision and
update of the MicroSave developed training course
Strategic Marketing in Microfinance, assistance
provided in February (Nairobi, Kenya)
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Action Research
Co-operation with MicroSave

Regional documentation of market-led case
studies for MicroSave. The following case
studies were developed Becoming a
Market-led Institution (Fundusz Mikro)
Entering New Markets with New Products Costs and
Benefits of Following the NPD Process (MDF
Kamurj) Market Development Through Product
Refinement (EKI) Costs and benefits of
Process Mapping (MiBospo) Costs and benefits
of Market Intelligence System Supportive to
Mission Fulfillment (Prizma)
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Action Research
Institutionalizing client tracking system
informing market research and building customer
loyalty with MDM Kamurj/Armenia

Publication of the Spotlight Note 13 Entering
New Markets How Market Research Can Inform
Product Development. Based on a Case Study of
MDF-Kamurj Armenia (January 2005) and Spotlight
Note 14 Institutionalizing Market Intelligence
An Important Step to Become Client-focused MFI.
Based on a Case Study of MDF-Kamurj Armenia
(March 2005) Dissemination at the SEEP PLP
global meeting in Nikaragua and at the MFC
conference in Bucharest
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Action Research
CGAP-IFAD Pro-poor Rural Innovation Challenge

MFC documented the vulnerability framework that
was tested with Barakot as well as the product
concept and prototype developed under the
project MFC Spotlight Note 16, Microfinance
for Protecting the Vulnerable in Rural
Uzbekistan. Market Research Insights for
Practitioners Based on a Case Study of MFP
Barakot (December 2005)
Micro-insurance
Pre-feasibility study for micro-insurance in
Ukraine took place in August
Other Projects
Development of protocol for reaching to the
un-banked. The project included field work with
Inicjatywa Mikro in Poland undertaken in
September 2005
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Policy Work

Policy maker video-conferences were organized in
June and July. Participants included Central Bank
representatives from Russia, Kyrgyzstan,
Kazakhstan and Armenia
2 issues of the MFC Policy Monitor were
published (in English and Russian)
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Network Services
3 issues of MFC Newsletter published in Russian
and English 9 CGAP publications (focus notes,
occasional papers and donor briefs) translated
into Russian and disseminated in the
NIS Bosnian language version of the MFC
Newsletter was published Transnational Exchange
Programme new EU funded dissemination project
launched.

2/2005
MFC coordinated Year of Microcredit activities in
Poland
1/2006
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2006 Highlights
Disseminate financial education and SPM
training/consulting Further develop
competencies in the area of strategic
management, social audit, poverty measurement
and products for risk management
(microinsurance, consumption products,
etc.) Develop products aiming at reducing
financing constraints directed at MFIs and
microfinance investors Respond to the market
diversification by Addressing needs of the
various types of MFC members Exploring options
for building capacity of country level networks
and mf resource centers Development of new
training products Faciliatate policy change
addressing access issues (MFC Policy Forum)

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MFC Membership in 1997

• In 1997 the MFC Network included 22 Member
• Organizations MFIs only.
• Examples
• World Vision Bosnia
• Opportunity International, Bulgaria
• Fundusz Mikro, Poland
• Albanian Development Fund
• OI Russia
• ACDI/VOCA

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MFC Membership in 2006

• Currently MFC serves as a network of 107
• Member Organizations from 28 countries.

The MFC Network includes Microfinance
Institutions (MFIs) - banks (ex XAC Bank,
OBM) - non-bank MFIs Networks,
Associations (ex FINCA, OI, MCI, WVI, CRS, EMN)
Funders/Investors (Oikocredit, EBRD)
Other Members (Klera Consulting)
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Current MFC Membership Offer

• Discount rates for participation in MFC
  training courses, workshops or conferences.
• Opportunities to participate in MFC-funded
  action-research projects (members are provided
  with free technical assistance and support to
  experiment with different solutions, innovate and
  implement new ideas) for example ImpAct, SPM and
  participation in working groups that document and
  disseminate regional best practices (EU
  transnational project).
• Participation in the MFC governance.
• Promotion through the MFC Website and
  publications incl. MFC Newsletter, Policy
  Monitor, MFC Spotlight Notes.