The Microfinance Experience with Savings Mobilisation (Technical Note No. 3)
Van Hoorebeke, O.S., Hamani, Z., Toure, M., Gabin, K., Sidibe, A. & Agyei, K.
Publication Date: 2000
Published by: USAID - U.S. Agency for International Development
Document Type: Other
Sound management structures and information systems are vital to the success of savings products
For microfinance clients, savings products are as popular as working capital and credit for investments. This paper notes that the challenge for MFIs is to design cost-effective savings mobilization strategies that respond to different client needs. These strategies can include:
- Developing individual voluntary savings products with different liquidity and return levels or differentiated interest rates;
- Promotional campaigns targeted to client demand.
The paper concludes that, although the benefits of savings are substantial, their success is not dependent solely on their design but also on the pricing and marketing process and an understanding of the market. For savings products to thrive in the marketplace, the MFI must have a sound management structure and an appropriate management information system to ensure that client deposits are not at risk.
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