Computer Aided Processing in the MF-Industry: Loan Tracking: The Case of SUMS in South Africa
This paper aims to demonstrate the value of computer aided loan tracking by citing the example of S-U Management Service (SUMS). The paper also examines how under-computerized microfinance institutions (MFIs), or MFIs without access to appropriate human resources, could benefit form this technology.
Explaining its rationale, the paper presents the following two reasons for advocating computerization:
- Stream lining cost efficiency regarding labor expenses;
- Saving on time for effective loan enforcement.
The paper describes the activities and outreach of SUM, and outlines its main concept of administration as follows:
- Serving information to agents and loan officers;
- Administering tracking of arrears;
- Providing statistics on an individual as well as on an aggregated level;
- Delivering accounting information for SUM's own financial systems and for the funder, Land Bank.
The paper lists the pre-requisites necessary for computerization:
- Suitable software;
- Technical infrastructure such as power supply, computers, telephone networks, reliable mail/courier service;
- Skilled human resources to operate the system;
- Postal address of the clients.
It concludes by stating that small MFIs that are not able to meet the above requirements can take recourse to outsourcing. Donor agencies could also step in to provide the necessary service for MFIs for a transitional period.
