Exploring Client Preferences in Microfinance: Some Observations from SafeSave (Focus Note No. 18)

Publication Date: Sep 2000
Published by: Consultative Group to Assist the Poor (CGAP)
Document Type: Paper

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How do clients respond to flexible products and services?

The study presents case studies that illustrate the wide range of needs and opportunities for which poor slum dwellers use financial services. They demonstrate that, given access to flexible services, they will use them in diverse ways, just like the less poor. Both of these observations support a growing consensus in microfinance circles that products and delivery systems need to be made more responsive to demand

Preliminary data from SafeSave, a small MFI working in Dhaka's slums, is presented and an analysis shows how clients respond to unconventional products. SafeSave's clients, who may be men, women or children, open individual accounts and are not organised into groups. They are visited every day (sometimes twice daily) in their own home or workplace, and all transactions are done during that daily visit, so the client does not have to visit a branch office nor attend meetings

The study concludes that:

• flexible services attract poorer clients. Examples are those of variable pay-ins and increased frequency of opportunity
• flexible products can be delivered to the poor safely and sustainably - through cost effectiveness, standardisation, delegation and technology
• there is potential for flexible products to be delivered to the poor on a large scale and in other environments - this requires further time and investigation