Unique Features of ASA Microfinance Model
ASA achieved sustainability within a couple of years since the beginning of its microfinance program. The innovative policies of the management and cost effective approach in all program aspects were key to make it possible to attain sustainability within the shortest possible time. Besides, strong determination of the management was also an important factor for attaining self-sufficiency with a steady growth. The following features are the key of ASA’s innovative management that facilitated attaining remarkable success of the organization.
- ➲ Dynamic and forward-looking leadership
- ➲ Self-explanatory written working manual
- ➲ Decentralization and delegation of authority to the branch level officials and participatory process in decision making
- ➲ Specialization in microfinance and rapid expansion policy
- ➲ Transparent and faster recruitment procedure
- ➲ On-the-job training approach (Each one teach one method)
- ➲ Simple and cost-effective branch structure without a professional accountant
- ➲ Simple and least hierarchical organization
- ➲ Easy and close communication among officials as well as between officials and clients
- ➲ Continuous onsite and offsite monitoring and supervision from both central and field levels
- ➲ Simple and transparent accounting and record- keeping system based on formats
- ➲ Opportunity for sharing and discussion to solve problems in the residential office
- ➲ Cost-effective culture practiced from top to bottom
- ➲ Effective fund management
- ➲ Diversified loan products to meet clients’ demand
- ➲ Simple and shorter loan processing
- ➲ No collateral for providing loans
- ➲ Loan disbursement within 07 (seven) days of membership
- ➲ Savings ( short and long term) and Loan Insurance for the clients
- ➲ No group guarantee required for providing loan
- ➲ No compulsion to remain present in the group meetings
- ➲ Education loan for members’ children
- ➲ Opportunity to withdraw savings at any time
- ➲ Special loan for natural disaster affected areas
- ➲ Health assistance for the clients without premium.
ASA’ unique cost-effective method helps a new branch to earn an adequate income to be self-reliant within 12 months of its inception:
Self-sufficiency of a Branch: The Key Factors –
- ➲ Staff members are selected quickly equipping through short and on-the-job practical training.
- ➲ The branch office structure is standardized and accommodated with adequate but simple furniture.
- ➲ Branch expenditure is standardized with set cost ceilings.
- ➲ A high number of borrowers, high portfolio per Loan Officer and high fund-revolving rate minimize total fund requirement.
- ➲ Simple and standardized accounting procedures.
- ➲ No extra full-time office assistant, technical personnel or security guard.
Features in Safeguarding Sustainability –
- ➲ Borrowers are monitored and scrutinized by the Branch Manager.
- ➲ Staff members provide ASA with a security deposit (earn interest).
- ➲ Joint signature required for withdrawal from branch’s bank account.
- ➲ Required daily withdrawal is allowed.
- ➲ Cheques are preserved jointly by different Loan Officers.
- ➲ Cash book is maintained by Loan Officers on a revolving basis.
- ➲ Loan Officers rotate groups after a year.
- ➲ Zonal and District Managers are based in the field.
- ➲ Central and Senior Officials staff visit field regularly.
- ➲ Regular internal audit.
- ➲ Annual external audit.
- ➲ Occasional and surprise branch visits by the President and the other senior officers of the organization.
- ➲ Automated A/C, MIS, generated by ASA microfinance management system (AMMS).
- ➲ AMMS is a home-grown system developed in-house by its IT experts.