ACCOUNT OFFICER’S BASIC TRAINING MIS Reports The Cash Flow is prepared to be able to establish : How much a client can afford to pay, thus also determining the maximum loan amount, and; How frequently loan repayments should be scheduled. Correctly establishing the answer to these two questions can mean the success (full repayment of the loan) or failure (default of loan payments) of a microfinance loan. Therefore, the procedure for filling up the Cash Flow must be clearly understood by the Account Officer. To facilitate the filling up of data, in addition the cash flow form, worksheets are also provided so that Account Officers can breakdown information provided by the client, particularly if the client has multiple income sources.

Topics Objectives Introduction Importance of management information system (MIS) in microfinance (MF) MF Loan Monitoring Reports Read the bullets… Ask the participants of their expectations of this module (at least 2 not more than 4). <NEXT SLIDE>

Objectives At the end of this module, the participants shall be aware of the benefits of having a good MIS for their institution’s microfinance activities. The participants will be familiar with the various reports used for monitoring MF activities. Read the bullets: At this point, ask the participants whether their computerized banking system is capable of generating microfinance reports. <NEXT SLIDE>

Why is MIS important to microfinance? The MIS of an institution includes all the systems used for generating the information that guide management in its decisions and actions. MIS can be seen as a map of the activities that are carried out by the microfinance institutions (MFI). MIS monitors the operations and provides reports that reflect information which management considers the most significant to track. All levels of the institutions, from top management and down, as well as funding organizations and regulators, rely on reports produced by the MIS to give an accurate picture of what is happening in the MFI. Read the bullets: Emphasize that MIS does not only involved computer hardware but the overall systems and procedures used to gather information. Emphasize the involvement of all levels of the organization not only top and middle management. As long as they need information, they need MIS <NEXT SLIDE)

Why is MIS important to microfinance? (cont’d) Methods, staffing, and even financing are frequently not proving to be critical constraints to growth. Rather, the ability to track status of its portfolio in a timely and accurate manner is often the most pressing need. In many cases, the difference between success and failure of the lending and savings operations of MFIs can mostly be attributed to the reliability of the systems tracking this information. Read the bullets: Attention to methods and procedures, proper recruitment and staff handling, and being prudent on resources are not the only important aspects and critical constraints to growth of a microfinance unit. The ability to tract status of its portfolio in a timely and accurate manner proves to be the most pressing need of an MFU. The reliability of the systems tracking the portfolio quality often leads an MFU to its success or failure. <NEXT SLIDE)

Why is MIS important to microfinance? (cont’d) Good information systems can: Improve the work of field staff, enabling them to better monitor their portfolios and provide better service to an increasing number of clients. Enable supervisors to better monitor their areas of responsibility, pinpointing priority areas that most require attention. Help senior management to better plan the work of the entire organization and make well informed strategic decisions by regularly monitoring the health of the institution through a set of well-chosen reports and indicators. Read the bullets: These are self-explanatory. At this point, ask the participants for questions, needs for clarification, and reflections. What can they say about the things discussed so far. <NEXT SLIDE)

MF Savings and Loan Monitoring Reports Listing of Loans Collection Due Report Delinquency Report Portfolio at Risk Report Interest Collected by Microfinance Unit Performance Report by AO Microfinance Monthly Report Client Status Report Start this topic by saying “When MABS started in 1998, the technical team realized that MIS has a vital role to the success of an MFU. The team has designed more than 30 reports to monitor the performance of the MFU. At that time there are 4 pilot banks. However, the banks felt that it was so tedious and cumbersome to generate all these reports hence, the team again meet and evaluated the reports. It went down to 20 and finally to 11 reports.” Read each title and tell the participants that each report will be discussed on the succeeding slides. <NEXT SLIDE> PAR by Aging and Business Activity PAR by Loans Disbursed and Business Activity Loan Profile by Gender

MF Savings and Loan Monitoring Reports Listing of Loans Collection Due Report Delinquency Report Portfolio at Risk Report Indicates loan portfolio data and quality Interest Collected by the MFU Performance Report by AO Microfinance Monthly Report Client Status Report Indicates revenue, growth and performance. The 11 reports are grouped according to purpose and characteristic: The first four reports (read them again) indicates loan portfolio data and quality. Ask the participants what they think portfolio data and quality means. The second four reports (read them again) indicates revenue, growth, and performance. Ask the participants what they think this means. The last 3 reports (read them again) enable the MFU to analyze the portfolio quality based on client, business and characteristic. Tell the participants that detailed explanation will be done during discussions of each report <NEXT SLIDE> PAR by Aging and Business Activity PAR by Loans Disbursed and Business Activity Loans Profile by Gender Analyzes quality based on client, business and characteristics..

Listing of Loans Report Lists all active loans Shows basic information of each active loan (name of borrower, loan acct. #, date of disbursement, maturity date, amount disbursed, loan balance, amortization amount) Shows loan amount overdue, portfolio at risk, and hold out balance Identifies what loan cycle the borrower is in Frequency: Usually monthly, but can be generated anytime Grouped according to account officers assigned and sorted by names of borrowers Users: Branch Manager, MFU Supervisor, AO At this point, ask the participant to refer to the sample reports. Read the bullets: If necessary, use the OHP and flash the acetates Discuss each items (columns and rows) using the table at the end of each report. Solicit questions, comments and reflections. <NEXT SLIDE>

Collection Due Report Lists loan accounts falling due on a specified period Shows the name of borrowers with amortization due for the period, the amount due (total amount and amount of specific items, including payments for principal, interest, other charges and savings), and the amount overdue. Frequency: Usually daily or weekly Grouped according to account officers assigned and sorted by names of borrowers Enables account officers assigned to identify which accounts are to be collected within the specified period Users: MFU Supervisor, AOs, Loans Bookkeeper At this point, ask the participant to refer to the sample reports. Read the bullets: If necessary, use the OHP and flash the acetates Discuss each items (columns and rows) using the table at the end of each report. Solicit questions, comments and reflections. <NEXT SLIDE>

Delinquency Report Lists delinquent accounts as of date of printing Exception report Shows portfolio at risk, total amount due, # of loan installments missed, # of days overdue, holdout balance, and exposed amount Grouped according to account officers assigned and sorted by the names of borrowers Frequency: Must be daily Users: Branch Manager, Supervisor, AO, RBAP/MABS At this point, ask the participant to refer to the sample reports. Read the bullets: If necessary, use the OHP and flash the acetates Discuss each items (columns and rows) using the table at the end of each report. Solicit questions, comments and reflections. <NEXT SLIDE>

Portfolio At Risk (PAR) Report Primary report that indicates the quality of the loan portfolio of the MFU An aging report that shows the overdue amount and portfolio at risk Also shows the total number of outstanding borrowers, the corresponding outstanding loan balance and their percentages Estimates the PAR ratio Frequency: Must be generated at least once a week, but can be printed anytime Users: Top Management, Branch Manager, MFU Supervisor, RBAP/MABS At this point, ask the participant to refer to the sample reports. Read the bullets: If necessary, use the OHP and flash the acetates Discuss each items (columns and rows) using the table at the end of each report. Solicit questions, comments and reflections. <NEXT SLIDE>

Interest and Fees Collected from the MFU Summary of interest and other charges collected within the specified date range, grouped by account officer Shows the income generated by each AO and the microfinance unit of the branch as a whole Frequency: Usually at the end of the month, but can be generated anytime Users: Top Management, Branch Manager, MFU Supervisor At this point, ask the participant to refer to the sample reports. Read the bullets: If necessary, use the OHP and flash the acetates Discuss each items (columns and rows) using the table at the end of each report. Solicit questions, comments and reflections. <NEXT SLIDE>

Performance Report By AO Shows the performance of each AO and the microfinance unit of the branch as a whole Comes handy if the bank has an existing incentive scheme Summarized by (according to) account officer AO performance indicators include: # of loans, new and repeat amount disbursed and revenue generated overdue amount and portfolio at risk Frequency : Usually at the end of the month, but can be generated anytime Users: Top Management, Branch Manager, MFU Supervisor, AOs At this point, ask the participant to refer to the sample reports. Read the bullets: If necessary, use the OHP and flash the acetates Discuss each items (columns and rows) using the table at the end of each report. Solicit questions, comments and reflections. <NEXT SLIDE>

Microfinance Monthly Report Compares the results of current month’s operations vs. those of previous months Compares the performance of the microfinance product vs. other products of the branch Shows comparative figures (loans, deposits, and financial income) between two succeeding periods Shows all loan accounts with outstanding balance Frequency : Usually monthly Users: Top Management, Branch Managers, MF Supervisor, RBAP/MABS At this point, ask the participant to refer to the sample reports. Read the bullets: If necessary, use the OHP and flash the acetates Discuss each items (columns and rows) using the table at the end of each report. Solicit questions, comments and reflections. <NEXT SLIDE>

Client Status Report Shows the credit history of the borrower (# of loans availed, loan amounts, # of payments missed, # days late, % of installments paid on time, status of current loan) Useful when evaluating an application for a repeat loan, or when determining what action to take against a delinquent borrower Divided into two parts First: shows client’s repayment performance on previous loans Second: shows client’s repayment performance on his/her current loan Frequency : As needed Users: Branch Manager, Supervisor, AO At this point, ask the participant to refer to the sample reports. Read the bullets: If necessary, use the OHP and flash the acetates Discuss each items (columns and rows) using the table at the end of each report. Solicit questions, comments and reflections. <NEXT SLIDE>

Other PAR Reports PAR by Age and by Business Activity Analyzes repayment performance by type of business or economic activity Shows the number of delinquent loans by age and by business activity Useful when analyzing patterns or trends in loan delinquency Is delinquency seen only in certain types of business or, across all types of business? Which business type has the most serious delinquency problem? Guides the MFU on what sort of business activities to market to and what businesses to avoid Frequency : Usually at the end of the month, but can be generated anytime Users: Branch Manager, Supervisor, AO At this point, ask the participant to refer to the sample reports. Read the bullets: If necessary, use the OHP and flash the acetates Discuss each items (columns and rows) using the table at the end of each report. Solicit questions, comments and reflections. <NEXT SLIDE>

Other PAR Reports PAR by Loan Amount and by Business Activity Shows the number of delinquent loans by loan size and by type of business Determines performance of borrowers by loan size Useful when analyzing which business type and what loan amount/cycle appear to have the most serious delinquency problems Frequency : Usually at the end of the month, but can be generated anytime Users: Manager, Supervisor, AO At this point, ask the participant to refer to the sample reports. Read the bullets: If necessary, use the OHP and flash the acetates Discuss each items (columns and rows) using the table at the end of each report. Solicit questions, comments and reflections. <NEXT SLIDE>

Loan Profile by Gender Summarizes profile of borrowers by gender Compares repayment performance of men vs. women borrowers Determines whether gender is a significant factor in repayment behavior Funding sources may want data on the bank’s outreach to women Frequency : Usually at the end of the month, but can be generated anytime Users: Managers, Supervisors, funding agencies At this point, ask the participant to refer to the sample reports. Read the bullets: If necessary, use the OHP and flash the acetates Discuss each items (columns and rows) using the table at the end of each report. Solicit questions, comments and reflections. <NEXT SLIDE>

Comparison Across Reports REPORT TITLE # Accounts O/Balance Amount O/Due PAR PAR% Listing of Loans  Delinquency Report PAR Report Interest Collected MABS Monthly Performance Report PAR by Aging PAR by Loans Disbursed Loan Profile by Gender This matrix will tell the participants what information or data that are similar and should be equal across reports. Take the # Accounts or “Number of Accounts” as an example. Guide the participants in examining the reports the reports with a check mark under # accounts. Together with the participants examine the reports whether the values are consistent. Distribute the worksheets (Comparison Across Reports) and ask the participants to examine all the reports. <NEXT SLIDE>

Comparison Across Reports Report Title OLP Beg OLP End Total Revenue Yield% Listing of Loans Delinquency Report PAR Report Interest Collected  MABS Monthly Performance Report PAR by Aging PAR by Loans Disbursed Loan Profile by Gender Follow the same instructions on the previous slide

Thank you!