Relationship & Partnering with MFSL

GENERAL MFI OPERATIONS

MFI manages branch offices in geography of their operations. The branch office manages identification
of eligible groups (often SHG or JLG), nurtures them, prepares documentation for financial assistance
and send recommendation for the assistance to the central office. The central office of the MFI
examines the eligibilities of assistance and sanctions. Once sanctioned, the branch office disburses loan
to the group. The branch is responsible for collection of installments of the assistance.
The central office of the MFI is responsible for managing its own corpus and relationships with the
participating banks who provide them money for micro finance assistance (loan) to the groups
(SHG|JLR), besides managing operations in the field.
The field is responsible for Collection, disbursement of funds, identifying the eligible groups (SHG, JLR),
and also for supporting formation of the groups in many cases.
Central office is responsible for examination and sanction of financial assistance to the identified groups,
managing corpus, managing relationships with institutions such as banks who invests their funds in
micro finance operations through the MFI.
The key challenges are
(a) management of integrity of financial operations (b) Money movement in a secured manner(c)
documentation on group, loans (financial assistance& literacy) and (d) right selection with feasibility of
repayment by the group. Information Technology plays a very significant role in managing the
operations ((a), (b),(c), and partly (d) for evaluation process) scalability, integrity, and efficiency.

MARGDARSHAK FINANCIAL SERVICES LIMITED, NBFC MFI

It is a leading MFI run by professional, operating on 4 states and 41 districts through its 84 branches run
by 399 field staff with central office at Lucknow headed by professionals. It has serving 104,000
customers with disbursement of over 250 crs. It has received investments from reputed national
organization SIDBI. It manages funds received from almost 30 organizations including 11 national banks
and development banks like SIDBI, and many reputed financial companies. The fund manages more
than 130 crs
The company is rated BBB- and is expanding its geography of operations. The BC model is being
followed for 2 banks IDBI and Yes bank.
The key focus of the institution expansion of the operations and efficiency of operations with high
levels of integrity of operations.

INTEGRA
NTEGRA MICRO SYSTEMSS TECHNOLOGY
Integra is a technology company with close association of BC focused organization i25 RMCS operating
~13,000 BC locations for banks and 500+ for MFIs currently. The technology solutions have been
deployed by various banks (11 Nationalized banks and 7 RRBs,..) and MFIs including SKDRDP (one of the
best rated MFIs in the country).
The basic implementation at MFI address 4 areas of operations

Money movement is registered and monitored at each stage

Biometric authentication improves integrity, non-repudiation, educe need for paper documents
Improvement in efficiency (productivity increase, documentation improves (e-KYC etc.)

Overall improvement in scalability of operations is achieved.

This was achieved by empowering field employee of the branches carry out the financial transactions
with the customers (SHG | JLR) using biometric devices. These devices transmit the transactions to the
middleware which in turn communicates to the Bank or central systems.
The Micro ATM can be a biometric POS device, or a PC/laptop with biometric subsystem, or tablet/
smartphone. Micro ATMs communicate with middleware/backend over mobile network/Internet. It
works in online mode with the bank |Central system for consolidated accounting or in offline mode
with Smartcards.
The authentication system is based on smartcard, Rupay Card, Aadhaar, Central Authentication system.
In case of SHG/JLR joint account (Secretary, President, Treasurer with any two endorsing the
transaction)
Moreover, Integra provides consolidated accounting system with its Central System, in case the MFI
wishes to manage the accounts of its customers and provide only GL entries to the participating banks.
In addition, Integra provides customized solutions more suited for the MFIs.

TO EXPLORE FURTHER & MODELING OUT WE WOULD LIKE TO UNDERSTAND

UNDERSTAND
THE FOLLOWING
a.
b.
c.
d.
e.
f.
g.
h.

What is the level of IT usage in MFSL?

Understanding on Accounting & Atomization of central accounting system
Levels of Branch computerization?
Status and spread of BC Operations with Yes bank and IDBI
Is MFSL is using Micro ATMs?
How many BCAs are working and its business generation
Technology currently getting used in MFSl
Size of IT team at the MFI