The Malegam Report & How Artoo can help you

January 22, 2011Report

Life’s difficult. We just wanted to say that we’re here for you. Count on us!

The Malegam Report is finally here. While we’re all glad to see how well balanced it is, we’re also beginning to make sense of the constraints that it places on MFIs in the short term. Here’s our take on what it’s asking you to do and how we might be able to help.


  • Business: No Security Deposits. Cap Loan Processing Fee at 1%. Cap Margins. Cap Interest Rates. Cap Borrowers’ Loan Amount…and still remain profitable!
  • Drastically Reduce Operating Expense Ratio (OER): We can help you reduce costs, remove redundancies, and improve efficiencies at all levels by taking processes online. Push the Employee to Borrower ratio and the OER down!
  • Self Sufficient Workflows & Better Cash Management: Centralize operations while keeping TAT for all processes as low as possible. Achieve Close of Business (COB) at the end of each day and gain better visibility into individual branch balances. Be able to provide actionable information to branch staff immediately.
  • Process: Moratorium >= Frequency of Loan…this can delay recovery & interest income by one additional month.
  • The Moratorium & Turn-Around-Time (TAT): We believe the best way for MFIs to counteract the downside of the Malegam Report’s moratorium clause might well be to find a way to drastically reduce their TAT for customer acquisition.
  • Field Agents: Better field agents. Must invest in their training & development.…difficult to find talent at any level.
  • Training & Service Quality: With Artoo, you can provide field agents with on-the-fly training modules without experiencing a loss in productivity. We can help you build the capacity and improve the quality of your field agents. All the while, capturing objective service quality metrics as well.
  • Customer: Provide non-financial services like financial literacy and life-skill development…often very resource intensive.
  • Skill Building & Development: Engage with and impart knowledge to customers without a loss in productivity in a resource-efficient manner without re-training field agents. Explore new possibilities: not all content needs to be provided by you; syndicate content from Artoo and its partners.
  • Technology: Borrowers can only have two loans, must maintain their groups, and only be associated with two MFIs. With these constraints it’s too expensive to invest in technology
  • Credit Bureau: Explore the possibility of integrating with the Credit Bureau in the field to evaluate customers even before forming groups.
  • Pay for Performance: Technology expenses made linearly proportionate to growth.

Going beyond the Malegam Report, we think you may be interested in the following too:

  • Business Real-time Health of Business: Monitor your business on a real-time basis and pick up on trends (mass defaults, political/economic) as they happen. Set up escalation rules.
  • Social Performance Highlight Your Impact Measure and report accurate performance statistics on a daily basis. Share video success stories of customers on your corporate homepage.
  • Technology Built to Last: Invest in technology that can handle the current turbulent regulation environment and meet the needs of your business as its scales.
  • More: We understand your business is unique. We are always looking for ways to collaborate with you and build technology that better suits your needs.
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