Greater Efficiency, Better Access
The MIF Project “Administrative and Operating Efficiency” sought to improve the efficiency and competitiveness of five non-regulated financial institutions affiliated with Women’s World Banking (WWB) in Colombia, reducing operating costs, adopting new technologies and developing new, innovative products.
Launched in 2000 as part of the MIF Line of Activity for Strengthening Microfinance Institutions, the project began in an unfavorable regulatory environment. High interest rates made it difficult for microfinance institutions to be profitable and companies had no access to bank loans. This made it difficult for these five NGOs in Bogotá, Bucaramanga, Cali, Medellín and Popayán to improve access to finance for their clients.
With the support of the program, these institutions developed new financial products, such as rural credit with repayment corresponding to agricultural cycles, healthcare and home improvement loans. At the same time, interest rates have fallen, new branches of these WWB affiliates have opened in rural areas, and the technical capacity of these institutions has improved, with enhanced computer networks and software for risk assessment. All five affiliates have seen increases in their lending portfolios and in the number of clients by over 200% and 170% respectively.
Since the end of the project, the regulatory environment has improved and now four of the five institutions, in Medellín, Popayán y Cali are either regulated, or are in the process of doing so, thanks to initial MIF support.