History of MicroSave

During its first phase MicroSave was designed and financed by UNDP and ODA to address the mono-credit culture prevalent in East and Southern Africa. Since this problem was most prevalent in Uganda, MicroSave was originally headquartered in Kampala. Soon after designing and establishing the programme, the Director, Graham A.N. Wright, realised that microfinance institutions (MFIs) in Uganda were not offering the clients the products that they needed. Instead, the MFIs were simply transferring the other models (primarily the Grameen Bank one) into Africa without reference to the local environment and needs. MicroSave started work to develop systems for understanding the demand side of microfinance and to design products based on detailed, qualitative, market research. More

Independent reviewers of MicroSave found “the project to be outstanding in articulating client perspectives in microfinance. MicroSave’s research is helping the microfinance field as a whole, and East African MFIs in particular, to understand how microfinance services fit into the economic, risk management and survival strategies of poor families. Its excellent market research training course has already given MFIs a new perspective on clients and tools (focus group discussion and participatory rapid appraisal techniques) to learn about client needs more effectively.”

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On the basis of the success of MicroSave’s work on demand side, UNDP, DFID, CGAP and the Ford Foundation asked the team to continue and expand their work from a new regional base in Nairobi, where it co-located with the Africap programme. Phase II of the programme focused on product innovation to respond to the needs of the poor – and thus worked on the supply side in addition to the demand side of the market. This gave rise to MicroSave’s acclaimed “market-led approach” to financial services and an expanded range of action research partners and toolkits. More

The mid-term review team concluded, “MicroSave II has continued to enhance its high reputation in the region, and generally across the global microfinance industry, most notably in demonstrating the importance of a client-responsive approach to the provision of financial services to poor people. All those who have had direct contact with MicroSave have commented on the professionalism, commitment, if not passion, which staff bring to their work. The project has performed impressively against its logframe targets, indeed with 15 months of the project still to run has already exceeded almost every one. The Director and his hard working team deserve high praise”.

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The major programmes of MicroSave continued from the second phase into the third phase, supported by DFID, CGAP, and the Austrian & Norwegian Governments. These programmes were: (i) technical assistance to selected Action Research Partners, mainly in East Africa, and (ii) the development and dissemination of training toolkits which built skills and knowledge especially in aspects of marketing and new product development in microfinance. A new programme started in this phase. It was an active process of developing local consultants who were trained to apply MicroSave training and toolkits on practical assignments, and training interns, and Young Executives, who spent eighteen months working closely with MicroSave core staff. More

The mid term review concluded, “Before the half way mark of this phase, MicroSave III has already achieved a number of its end of programme targets and is likely to achieve the others in the remaining period. The programme therefore deserves high commendation for more than fully achieving its desired outcomes to date; and also for producing additional unplanned deliverables. MicroSave has developed a brand recognized for its quality and distinctive market-led approach, not only in East Africa, but in microfinance more generally”.

For more information, read MicroSave’s Project Completion Report

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From January 1st, 2008 the project in Africa was transformed (at the request of the donors) into a consulting company. In this way the donors hoped that they would create a sustainable, local consulting company to support the growth of high quality, client-responsive microfinance in the region. The consulting company in Africa continues to grow in terms of the scope of its work and the scale of the organisation and has completed assignments in a huge range of places including Cameroon, Congo, Ethiopia, Ghana, Kenya, Malawi, Nigeria, South Africa, Tanzania, Uganda and Zambia.

In 2003, MicroSave was asked by the UK Government’s development assistance department (the Department for International Development - DFID) to explore setting up operations in India. After a long period of consultation, MicroSave started in Chennai in 2006 with support from ICICI Bank. Soon thereafter, the Board of Trustees recommended moving the organisation’s head office to Lucknow, to ensure that it was based in the heart of the under-served and poorer northern states of India. Lucknow was also chosen with a view to developing close working relationships with the Small Industries Development Bank of India, the Bankers’ Institute of Rural Development and the Indian Institute of Management-Lucknow. More

Today, in India MicroSave is working for the Bill and Melinda Gates Foundation and others including HDFC and ICICI Bank to implement a “Market-led Financial Services” programme comprising:

• An Action Research Programme to provide training and technical assistance to MFIs seeking to develop new products/delivery systems or refine their existing ones;
• A Financial Services Learning Centre to develop an integrated microfinance curriculum for MFIs and the consultants that support them; and
• A Research, Policy and Dissemination Centre to inform the development of the microfinance sector in India.

MicroSave also provides technical assistance to over 30 MFIs being supported by Opportunity International, Australia on rapid institutional assessment, strategic business planning, market research and product development, process mapping and credit management.

MicroSave’s other large project in India is for the Royal Bank of Scotland Foundation India and Cordaid to support the development of 42 MFIs operating in under-served and remote areas of India through providing training and technical assistance – including training through the acclaimed Applied Microfinance Institute.

Over the last few years, MicroSave has been asked to provide additional technical assistance and training in markets outside India including the Philippines (where it runs a very extensive programme of support for three leading MFIs), Afghanistan, Bangladesh, Indonesia and Cambodia.

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