Standard Toolkit for Learning Centers Hosting Guide 3 – Client Selection (CIBI & Cash Flow Analysis) MABS Learning Centers Training-Workshop

Standard Toolkit for Learning Centers: Hosting Guide 3 – Client Selection LC Guide 3:Loan Administration & Management (Client Selection) Objective1.To provide hands-on experience in conducting credit and background investigation (CIBI) and cash flow analysis using actual clients of the bank. 2.To provide them an experience on how to prepare a CIBI report. 3.To demonstrate actual conduct of client orientation session. Duration1 day MethodologyInterviews, observation, report completion

Standard Toolkit for Learning Centers: Hosting Guide 3 – Client Selection LC Guide 3 (cont’d):Loan Administration & Management (Client Selection) Training Materials Loan Application Forms – New and Repeat Applicants CIBI Forms – New and Repeat Borrowers Cash flow form & worksheets Client status report for repeat clients Repeat Borrower’s loan folders Acetate slides Participants Group assignment for CIBI & Cash Flow field activity EquipmentLCD/Overhead projector Computer Sound system Training HandoutProgram of Activities Participants Group assignment for CIBI & Cash Flow field activity

Standard Toolkit for Learning Centers: Hosting Guide 3 – Client Selection ACTIVITIES: Program agenda. Activities to include in the loan administration and management practicum are: Conducting CIBI of NEW bank applicants 1. Interview client (and spouse) at their residence or place of business 2. Interview co-makers 3. Interview neighbors (residential and business) 4. Conduct credit investigation with other lenders in the area (lending investors; other rural banks, cooperatives, NGOs)

Standard Toolkit for Learning Centers: Hosting Guide 3 – Client Selection ACTIVITIES: Program agenda Conduct a revalidation check and cash flow analysis of a REPEAT borrower. (this is optional if time is limited) Process the CIBI and cash flow and prepare the recommendation. Present recommendations before the bank’s credit committee.

Standard Toolkit for Learning Centers: Hosting Guide 3 – Client Selection ACTIVITIES: Program agenda The bank should prepare items listed below (it is likely that the trainees will be grouped in pairs. Arrange for one NEW loan applicant for every two trainees (if grouped in pairs). Arrange for one REPEAT loan borrower to be interviewed by every two trainees. Have available copies of the selected repeat borrower’s “client status report” and deposit balance attached to their repeat loan application.

Standard Toolkit for Learning Centers: Hosting Guide 3 – Client Selection ACTIVITIES: Program agenda Designate the bank staff (AOs) to assist the trainees in locating the applicant’s business or home. Make available CIBI forms, including the recommendation sheet. Make available the folders of repeat loan borrowers. Make available the application form of new borrowers. Conduct the credit committee meeting for the presentation of the trainees’ findings and recommendations.

Standard Toolkit for Learning Centers: Hosting Guide 3 – Client Selection ACTIVITIES: Program agenda The bank may not want to use the results of the trainees’ CIBI and cash flow analysis for making a decision on approval. What then does the bank do? a. The bank can choose clients whose CIBI and cash flow the bank’s account officers had completed, and whose applications have been favorably considered. b. The bank would need to advise the applicants about the training activity and that they have been chosen for a re-interview and reinvestigation.

Standard Toolkit for Learning Centers: Hosting Guide 3 – Client Selection ACTIVITIES: Program agenda. But suppose there is a conflict in the findings and recommendations by the trainees and bank staff? The bank supervisor should verify conflicting that surfaces during the training.

Standard Toolkit for Learning Centers: Hosting Guide 3 – Client Selection ACTIVITIES: Discussion After presentations and client visits, facilitate a discussion of the participant's experiences and observations. Ensure that bank officers and microfinance personnel are present for this briefing to listen and to respond.