1

Theme- Micro-Finance & Technology

Theme- Micro-Finance & Technology

Volume 7

Issue 1

September 2006

From the Editor's desk

From the Editors' Desk,

Information Communication Technology (ICT) plays a very important role in the world

today, both in developed and under-developed economies. It has been used in different

sectors to spur development and has improved businesses across the globe. It is also true

for the financial sector and, of late, in the microfinance sector that delivers social and

financial services or only financial services to the urban and rural poor.

Keeping in view the important role played by ICTs, this issue of the newsletter deals with

the application and use of information technology in microfinance. Mr Subodh Kumar

Gupta elaborates on a wide spectrum of IT applications for microfinance operations. He

uses both the operational and application dimensions of IT. He also throws light on the

advantages of IT for the growth of the sector and the problems and best practices of

computerisation.

Mr. I. Gopalkrishnan, R. Arjun and S. Narayanan discuss the seven lessons for effectively

integrating technology and automating MIS for MFIs based on the practitioners'

experience. The learning here are that computerisation should only happen when the

microfinance model is reasonably stable; there is no substitute for a comprehensive needs

assessment through appropriate methods, prior to automating an MIS; MIS design must

be kept simple and flexible; MIS must be in compliance with best practices, past data

conversion must be looked at the time of designing an automated MIS; and finally,

maintenance of an automated MIS is serious business.

Contents

Mr Narendrath provides an account of a computerised account system, run and operated

by local youth-entrepreneurs call "Computer Munshis" who are employed by SHGs to

maintain their accounts. He talks about how the systems work, the various actors involved,

and their roles. His article showcases the success story of computer munshi Sumanta

Information Technology Solutions, A

Singhadeb of Balarampur village in Purulia, West Bengal.

Growth Driver for MicroFinance

Institutions: An Overview

Mr Ramesh Arunachalam has attempted to look at microinsurance within the field of

microfinance and provide real-life examples of how technology has been used to reduce

Technology: Miracle Cure for

delivery costs, enhance access and create other impacts including better services. He

talks of Megatop Limited (an insurance broker in India), which has used e-Choupal, a

Microfinance

web-based technology, for the promotion and marketing of a large variety of insurance

products offered by several insurance companies. He elaborates on how technology is

Computer Munshi: A Self-Sustaining

used to overcome geographical hindrances, like remoteness and distance, with regard

Mechanism to Manage SHG

to underwriting insurance policies. This entails a large number of repetitive transactions.

Accounts & MIS

Finally, we have an excerpt from the speech of Dr. Y.V. Reddy, Governor, Reserve Bank

of India on "Use of technology in the financial sector: Significance of concerted efforts".

Use of Technology for

Microinsurance Distribution:

We look forward to your feedback and contribution in making the Patrika a platform to

Experiences from the Field

take the microfinance movement forward.

Mathew Titus

RBI Speech - Excerpts

Published by Sa-Dhan Microfinance Resource Centre

12 & 13, MPTCD Building, 2nd Floor Special Institutional Area, Shaheed Jeet Singh Marg, New Delhi 110067

For private circulation only