Institute of micro-finance and cooperative development.

CSD Chairman caution MFI Branch Managers not to put clients into Over Indebtedness Trap

Speaking from the chair of the closing ceremony of Credit Appraisal training organized by CSD, Mr. Shankar Man Shrestha, Chairman of CSD urged the participants to emphasize more on betterment of their members by avoiding over indebtedness. He mentioned that MFIs have been prospering day by day in terms of number of clients they served, volume loan operation, profit abilities  and have been able to distribute good dividend to the shareholders and provide good bonus and facilities to their staff, but he asked “what about the clients? Have they been able to prosper in real term or they have been put into poverty trap”. He urged all the participants to be concerned about their member clients. He said, “Please ask yourself – What microfinance is for and who does it target? And what microfinance could achieve at the members level? Find the answers by assessing the real conditions of your members after microfinance service”. He urged them "Focus on your members, help them grow economically and socially and work for their betterment. You must make sure your clients develop along with you and your organizations then only you will be considered as true practitioners of, microfinance.” After distributing certificate of participation to the participants he ended the ceremony wishing all the participants very best in meeting their Institution’s mission.

The four day long training was organized with the aim of helping MFIs to systemize the process of credit appraisal to safeguard their loan portfolio and minimize risk therein and promote and develop the clients’ economic conditions.

There were 31 participants from 13 different MFIs. They were equipped with different credit appraisal tools. The training tried to address the emerging operational issues and challenges faced by the microfinance and rural cooperative sector like identifying potential clients, client literacy, credit appraisal, collateral valuation, credit processing and cash flow analysis, monitoring and supervisions etc. The training also incorporated a day long practical exercise in the field by way of applying the knowledge gained in the classroom to the real clients. The participants carried out practical sessions with the clients of Thimi and Chuchepati Branches of Swabalamban Laghubitta Bikas Bank Ltd.
The participating MFIs were- Swabalamban Laghubitta Bikas Bank Ltd., Muktinath Bikas Bank Ltd., Chhimek Laghubitta Bikas Bank Ltd., CYC Nepal, Mero Microfinance Bittiya Sanstha Ltd., Swarojgar Laghubitta Bittiya Sanstha Ltd., Solve Nepal, Mirmire Microfinance Development Bank Ltd., National Microfinance Bittiya Sanstha Ltd., Nadep Laghubitta Bittiya Sanstha Ltd., Bauddha Grameen Multipurpose Cooperative Ltd., Udaydev Multipurpose Cooperative Ltd. and Womi Microfinance Bittiya Sanstha Ltd.