The world is more digitized than ever, and the microfinance industry is not falling behind in this race. Like the traditional banking sector, it is also moving into the digital era. And in this journey, customer satisfaction is important. In this blog, we will talk about some points that can help you improve digital services in microfinance for your borrowers and employees.
Without any doubt, microfinance has to adapt to the digital world to keep up with reality. Although they have already been doing so in recent years, they have been forced to speed up their process because of market transition.
But have you ever thought about why?
Today’s borrowers of digital microfinance expect to be part of an institution that makes their lives easier, saves them time, and guarantees their security.
Below, we will discuss five ways to facilitate and improve digital services in microfinance operations. These will also make your borrower’s customer journey easier and more satisfying.
5 Important Things That Improve Digital Services in Microfinance
We can talk about plenty of points that can help you improve digital services in microfinance. However, today we will talk about some technology-intensive and customer experience-based suggestions.
So, let’s dig deep into the points that can help you improve your MFI’s digital transformation. And these will also help you increase microfinance efficiency as a whole.
Advanced-Data Analysis
Financial institutions like banks and microfinance currently use advanced levels of analysis. It uses evolved algorithms that improve the quality and speed of results on the fly. This system has come to replace the already obsolete data in a spreadsheet, large and complex numerical tables, and limited calculators, to be replaced by big data, Artificial intelligence, and Machine Learning. You can take Southtech’s BI (Business Intelligence) tool as an example. It can help you evaluate your business and make profitable decisions.
Believe us; you need to consider more data analysis for your MFI than you can imagine. But why? Well, many factors are involved here, but expansion and customer retention are two of the major.
Microfinance organizations must increase their customers and retain those already there more effectively by providing personalized advice. The advantage of using data and analytics is that you can monitor and supervise your business regularly.
At the moment, it is the big microfinance organizations that have opted for Big Data. However, some medium-sized entities are already beginning to modify their structures because decision-making based on data is a new paradigm boosting the financial sector little by little.
Therefore, we consider data analysis as one of the first things to consider to improve digital services in microfinance.
User Security
Security is one of the most important factors behind customer satisfaction. Moreover, it is an undeniable thing to consider to improve digital services in microfinance operations. But why is that?
Well, security is one of the doubts that users have when using digital tools. And this is why currently, all digital microfinance organizations are prioritizing this.
However, customers often do not know these, yet you must not undermine security. And promote the communication of technologies, including complete information on protecting your data and money.
In addition, when using any core banking solution, the user must have guarantees that give them the perception of security, for example, that access to the digital service is not too easy or that the system requests various access methods.
To improve your digital service in microfinance, your users must be careful with their repayments or deposits; for example, ensure they send the money to the right digital source. Although these responsibilities would fall on the client, the financial entities must provide them with the official channels in which they must carry out their movements.
Marketing Efforts
Marketing is, today, a key element in any organization, and microfinance cannot be the exception. Even though many more people are currently connected to social networks or have access to information and advertising, capturing their attention becomes a greater challenge, so having a marketing strategy for microfinance is also essential.
An excellent resource available to Banks is the implementation of interactive campaigns based on their customers. Through marketing campaigns, they can create awareness, educate borrowers and encourage them to adopt digital microfinance.
Having effective and attractive marketing campaigns will achieve greater customer loyalty and allow them to change their behaviour and create habits about using digital services.
Borrower Experience
The digital world in which we currently live forces microfinance to be part of it, to adapt and create more effective and friendly solutions for their customers. Users, especially those under 35 years of age with access to smartphones and computers, expect their lenders not only to offer them access to its platforms from any device but also to be quick and easy to use.
Although the youngest customers are the most demanding regarding the user experience, the older ones implicitly expect the same. If they find themselves facing a channel that is too complex to understand, they will quickly abandon it.
The customer of a microfinance organization also likes to be heard, so making them part of the processes, asking them about their experience, or asking for their opinion on new offers, will give them a sense of belonging and will build loyalty in their relationship.
Digital channels
Last but not least, digital channels are the major entities that can improve digital services in microfinance operations. A few years ago, it was believed that having a website was enough to consider digital microfinance. However, they are only a complement to this experience. For example, the mobile applications of financial institutions are now essential for field officers and users, and the more possibilities they offer, the more effective they are.
Besides, flexible repayment options are also important in improving customer satisfaction. For example, if they have the option to make repayments through mobile banking or agent banking using your website, it would be more helpful for your customers.
It is also essential to have tools for self-service microfinancing for those who do not like to make long lines for a loan. Mobile banking, internet banking or branchless banking can enable more transactions, obtain an online turn to be attended, etc., are some of the options we can find today.
Currently, almost all transactions can be carried out, and almost all microfinance services can be obtained through digital means. You can become a member, open a deposit account, request a loan, or make repayments. All these no longer require an in-person operation.
If you do all these, your microfinance will continue to expand its digital portfolio to the extent that your users continue adapting to this new reality and improving digital services in microfinance operations.
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