Five Changes from FINCA’s Partnership with Mastercard Foundation

It has been five years since FINCA subsidiaries in Tanzania, Zambia and Malawi began their journey with the Mastercard Foundation. In that brief period, a lot has changed. FINCA has transformed from a brick-and-mortar organization to one that leverages cutting-edge technology to deliver financial services to some of the continent’s most rural and underserved communities.

The partnership helped FINCA to leap forward: strengthening middle and front-line staff through training; deploying alternative delivery channels such as agency and mobile banking; and moving beyond credit-centric products to offer a broad range of financial services, including savings, transfers, and cash management solutions.

Today, FINCA has launched digital channels and automated processes. We open accounts remotely and use credit scoring to make loan decisions. We’ve also deployed an e-learning platform that supports the organization’s staff learning and development agenda. And we’ve enhanced our research capacity with tablet-based data collection and a well-trained research and development team.

Here are five changes brought about by this partnership and how they’ve impacted our capacity to serve customers.

Expanding distribution has reduced costs for our customers.

FINCA has expanded its distribution network to 253 active agents across the three program countries: 139 in Tanzania, 75 in Zambia and 39 in Malawi. Over 65 percent of transactions are now being performed through the agent banking channel. This expansion has had a significant positive impact on our customers: it has driven down the time and cost of reaching FINCA’s service points and allowed clients more time to focus on their business operations.

The partnership has also enabled FINCA to collaborate with mobile network operators (MNOs) to launch mobile banking. This has allowed our customers to perform a range of transactions on their phones, including but not limited to: air-time top ups, bill payments, loan re-payments and internal funds transfers. All these channels have provided a range of choices that our customers can use to bank with FINCA.

banking agent
Oliver “Spy” Kamwendo became FINCA’s first banking agent in Malawi.

Employing mobile networks has helped us to acquire new clients.

Partnering with MNOs has allowed FINCA become the first microfinance institution in Africa to launch a mobile savings product. It has also opened market opportunities for FINCA, allowing us to tap into new mass market segments. Launched in Tanzania in late 2017, HaloYako, a mobile savings and credit product, has so far acquired 140,000 new customers for FINCA Tanzania and continues to drive deposits. Similar deployments are underway in Zambia and Malawi and should go live before the end of 2018.

A female client in Tanzania opening a HaloYako mobile savings account.

Putting the customer at the center has allowed us to better understand our market.

The partnership with Mastercard Foundation has enabled FINCA to focus on the customer. This, in turn, has improved the organization’s ability to understand client needs and the social impact of its financial inclusion efforts. The Mastercard Foundation grant leaves behind an organization committed to capturing, analyzing and infusing customer feedback into its operations and products. FINCA has built a strong research team and automated tools for data collection and analysis, and FINCA leaders are committed to investing in customer research over the long term.

microfinance research
Listening to the needs of our customers, like FINCA client Sofelet Kachoka Phiri in Malawi.

Leveraging technology has enhanced staff learning.

From high cost face-to-face training programs to a blended learning approach that uses face-to-face and e-learning, FINCA is now able to design its own courses and deploy them over its e-learning platform: The FINCA Learning Zone. The Mastercard Foundation partnership helped us to build a strong team of training managers, a robust and proven learning approach, and a sustainable, cost-effective course delivery mechanism focused on building the staff’s core competencies.

professional development
Training a team of learning managers for accelerated professional development of FINCA staff.

Newly acquired knowledge and experience has allowed FINCA to become a thought leader in digital financial services.

FINCA is now sharing lessons learned from the program with the wider industry as part of its learning and knowledge management strategy. FINCA subsidiaries will continue to work with other microfinance institutions, sharing knowledge in the areas of digital finance, learning and development, and customer research and social performance.

banking agent
Using digital financial services, like biometric point-of-sale machines, to better reach and serve FINCA clients.

Five years on, FINCA is a dramatically different organization than it was before the Mastercard Foundation partnership. Today, technology-enabled solutions lie at the heart of the organization’s products, processes and channels. Our enhanced distribution capacity is already driving growth within new market segments. And our people have changed, too. We’ve instituted continual learning for staff and ongoing research to better understand our clients’ needs. In fact, our relationship with our customers has changed the most. Customers are now more than ever the focus of everything we do, and that constitutes a big leap forward.