Delimiting Microfinance Through Effective MIS - The Philippine Rural Bank Experience

This paper argues that:

• The success of microfinance in the Philippines depends upon the success of microfinance delivered by the rural banks;
• One of the critical components of success in microfinance is the harnessing of a suitable information technology (IT) - enabled management information system (MIS) that effectively delimits aspirations for growth in outreach and sustainable operations.

The paper seeks to identify the key success factors for effective IT-enablement microfinance operations of Philippine Rural Banks. It:

• Studies the experiences of JSPL Philippines Inc., the Philippine subsidiary of the Indian microfinance-focused IT company Java Softech Private Limited.
• Explores the entire process of understanding the strategic operational requirements, design, customization issues and implementation.
• Shows how microfinance operations of the rural banks benefit from a system that:
  • Facilitates day-to-day transactions;
  • Enables effective control over collections;
  • Generates reports that aid decision making by the bank management;
  • Produces desired reports and information for external agencies like regulatory bodies (e.g. Central Bank) and funding agencies.

The paper concludes by examining the future for IT companies in the microfinance sector of rural banks.