Microfinance Analytics using Microsoft PowerBI

Microfinance Analytics using
Microsoft PowerBI

Get a 360 view of your customer and drive efficiency
in the business with informative reports and analytics

Microfinance is a banking service provided to unemployed or low-income individuals or groups who otherwise would have no other access to financial services. 

Microfinance Institutions are a boon to the developing nations across the world. While the self-employed small scale business owners strive for loans, the Microfinance institutions (MFI) across the globe extends small loans to these business owners. The MFIs also offer other financial services such as savings accounts, health services, training, networking and peer support. With the help of MFIs, businesses can pursue entrepreneurial projects generating extra income and thus supporting their families.

Given this, it is important that the MFIs also understand how efficiently they are serving their customers and measure the productivity of their staffs. Recent years have observed a growing push for transparency in Microfinance.

But, how is this transparency possible?

With Microsoft PowerBI, we can create informative reports to help businesses understand their customers better. We can measure risks associated, financial and staff performance through these reports. We have taken a step forward to put in place a report that highlights some of the indicators to provide transparency about the MFIs worldwide.

Microfinance analytics reports and dashboards – How do I go about doing it?

Below is a short demo on how PowerBI, a growing Microsoft Business intelligence tool, has been used on a sample microfinance data, to give insights to the business. The demo walks through multiple reports and drill downs to give the organisation deeper information. It also shows the ease of use of a tool like PowerBI with huge data, both for simple and complex reports.

What does the report highlight?

Overall performance of Top MFIs
  • The top 10 MFIs with High Deposits: This is a positive indicator for the MFIs projecting the deposits or reserves.
  • Loan Loss Rate of the MFIs in decreasing order: This is a negative indicator showing the loss of MFIs from lending loan.
  • MFIs at Risk: This indicates the top 10 MFIs that has portfolio at risk for more than 30 days.
  • MFIs with high Write-off Ratio and Risk Coverage %: Write-offs are the loans that are not likely to be repaid back anymore whereas, the Risk coverage indicates the preparedness of the MFIs with their loan loss reserves to combat these Write-offs.


Performance of Individual MFIs

You can further drill down and select individual MFIs and understand their performance at a more granular level.

  • YOY Gross Loan Portfolio: The outstanding loan of MFI year on year.
  • Portfolio to Asset Ratio: This ratio determines the amount allocated by MFIs to its loan business.
  • Loan Officer Productivity: This measures the performance of loan officers by evaluating number of borrowers per loan officer.
  • Cost per borrower: This is a cost indicator, indicating the operating expense on each client.
  • Yield on Gross Loan Portfolio: This measures the yield of MFIs as cash interest payments from its clients.
  • Return on Assets (RoA): This indicates the performance of the MFIs in terms of efficiency. To put it in simple words, RoA measures how well the institutions are able to manage its assets.
  • Sector wise Gross Loan Portfolio: This gives a detailed analysis of the presence of MFIs in each sector.
  • Loan Outstanding: This measures the total amount of outstanding loan associated with the MFIs.

Such reports can be further adopted by various Microfinance institutions globally to measure and analyze their performances in terms of loan portfolios, staff productivity as well as risks associated.

PowerBI can further be leveraged to analyze loan loss reserves and maintain adequate loan loss reserves so that the performance of the MFIs are not hindered.

Want to know more?

If you think this solution would be useful for your organization or you have a relevant use case or pain point you would like to tackle, get in touch with us today and we can help you and work together towards a solution!