Channels & Technology, AccionSeptember 2015

Digital Field Applications:Opportunity Bank Serbia Case Study

Photo courtesy of Opportunity Bank Serbia:Client advisor Danka Mlinar meets with OBS client Tomislav Stankov in Kovilj, Serbia

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Table of Contents 3 Acknowledgments

4 1. Executive Summary

4 1.1 Findings

5 2. Introduction

6 2.1 Overview of the DFA at OBS

7 3. Implementation Process

7 3.1 Planning & Analysis Phase

8 3.2 Development & Implementation Phase

8 3.3 Pilot & Rollout Phase

9 4. Impact

9 4.1ClientBenefits

9 4.2InstitutionalBenefits

9 4.2.1 Cost Savings

9 4.2.2EfficiencyEnhancements

10 4.2.3AdjacentBenefits

11 4.3 Challenges & Lessons Learned

12 5. Business Case

12 5.1 DFA Costs

12 5.2 DFA Revenues & Cost Savings

14 6. Next Steps for Opportunity Bank Serbia

15 Project Team

3Digital Field Applications: Case Study - Channels & Technology, Accion

Acknowledgments

WewouldliketothankthemanagementofOpportunityBankSerbiaforpartneringwithusandcontributingtothiscasestudyandbusinessmodel.

About Channels & Technology

Accionisaglobalnonprofitdedicatedtobuildingafinanciallyinclusiveworldwitheconomicopportunityforall,bygivingpeoplethefinancialtoolstheyneedtoimprovetheirlives.Accion’sChannels&TechnologyteamisanexperiencedgroupofprofessionalswhohaveworkedwithavarietyoffinancialinstitutionsandFinTechcompaniestoplan,testandimplementinnovativetechnologiesandmethodstoreducethebottlenecksforachievingfinancialinclusiongrowthandscale.

About Software Group

SoftwareGroupisatechnologycompanyfocusedonprovidingproductsandservicestothefinancialinclusionsector.Withglobaloperations,SoftwareGrouphasawealthofexperienceindeployingcomplextechnologysolutionsforitsclients.Inadditiontodesigninganddeployingsolutions,SoftwareGroupprovidesconsultingservices,withaparticularfocusonassignmentsthat,aswiththiscasestudy,helpsharelessonslearnedfromthesector.

Aroundtheglobe,microfinanceinstitutionshaveprovidedaccesstofinancetomanypeoplewhowerepreviouslyexcluded,offeringarangeofquality,affordableservicesmarkedbyconvenience,dignityandconsumerprotection.Historically,however,bringingtheseservicesinthefieldtotheclienthasbeenacostlymanualprocess,whichhaslimitedtheabilityforscalingupandcreatedvulnerabilitytosub-optimalservice,errorsandfraud.Inresponsetothechallengetobalanceoutreachwithcostswhenprovidingfinancialservicestotheunderserved,wehaveseenariseinrecentyearsintheuseoftablets,smartphonesandotherdevicesthatdigitizemicrofinancefieldoperationsforthesakeofrealizingmuch-neededefficiencies.Forexample,loanofficersequippedwiththesedevicescanprocessloanapplicationsandanswerclientinquiriesinthefield,eliminatingpaperforms,digitizingdataandsavingtimeandmoneyfororganizationsandtheirclients.

Theuseofthesetoolsinthemicrofinancesector,whichwecallDigitalFieldApplications(DFAs),isstillatarelativelynascentstage,limitedtoearlyadoptersornewmarketplayers,mostofwhomincorporatethetechnologyintotheirinitialprocessandmarketoffering.TheslowadoptionofDFAshasinpartbeenattributedtotheproviders’lackofunderstandingoftheimpactDFAshaveonthebusinessmodelsofMFBs,forclients,andmostimportantlyforthestaffusingDFAsinthefield.

TheobjectiveofthisstudyistoaddresstheseissuesbyprovidingclarityontheimpactofDFAsbyexaminingthebusinesscase,implementationprocessandeffectsforthreeMFBsaroundtheworld.TheinstitutionswepartneredwithforthestudywereUjjivan

FinancialServicesinBangalore,India;MusoniKenyainNairobi,KenyaandOpportunityBankSerbia(OBS)inNoviSad,Serbia.ThiscasepresentsthefindingsfromOBS.ThefindingsfromUjjivanandMusoni,aswellasaconsolidatedreviewofthethreecases,canbefoundonourwebsite,2withanaccompanyingExcel-basedbusinesscasetoolkit,whichisavailableforMFBstoexaminetheprospectsofDFAsfortheirspecificbusinesscontext.

Findings

OBS’skeyobjectiveinimplementingaDFAwasdifferentfromtheothertwoinstitutions’.OBSsoughttoimprovecustomerserviceandreducecoststhroughtheuseofautomatedcreditdecision-making.ThebanktargetedagriculturalloanswithinpredefinedlimitstodevelopacreditscorecardaccessibletoloanofficersviatheDFA,whichdeliveredacreditdecisioninthefieldfor80percentofagriculturalloansdisbursedinthepilotperiod.

Clientsbenefitedfromincreasedaccesstocreditinatraditionallyunderserved,ruralagriculturalmarket.Clientsalsoenjoyedimprovedcustomerserviceandconvenienceasaresultoftimesavingsandafasterloan-applicationresponse.

OBSbenefitedfromthereducedcostsandincreasedefficiencythataccompaniedtheautomationofcreditdecision-making,whicheliminateddataentryerrorsandimprovedcompliance.Additionally,OBSestablishedareputationinthemarketasaninnovator,andenhanceditsabilitytoleverageSocialPerformanceMeasurement(SPM)databydigitizingclientrecords.

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Executive Summary

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1 ThispaperdiscussestheuseofDFAsthatcouldbedeployedbyahostofdifferentfinancialserviceproviders,frommicrofinanceinstitutionstocommercialbanks.WhileweuseterminologyassociatedwithMFBs,thisdoesnotprecludeothertypesoffinancialserviceproviderswhohavesomecomponentoffieldoperationsthatissuitablefordigitization.

2 http://bit.ly/1UphWmp

5Digital Field Applications: Case Study - Channels & Technology, Accion

In2007,aftertheSerbianrevolution,OBSconvertedtoafullcommercialbank,subjecttoastrictregimeofcontrolsdesignedtorebuildconfidenceinthefinancialsector.Despitealackofaffordablefundingandsubsidiesfromitsparentcompany,thebankwassuccessfulthrough2008,whenthefinancialcrisisdemandedanewstrategytoensureitsfutureviability.By2009,OBSwasundernewleadershipandoperatingwithanimprovedriskmanagementprogram.Asaresult,thebankwasoneofthefewplayersthatwerereportingpositivegrowthinthemarket.

ThemajorityoffinancialserviceinstitutionsinSerbiafocusontheBelgradeandVojvodinaprovincesintheNorth.Incontrast,approximately60percentofOBSclientsliveinCentralandSouthSerbia.Eighty-fourpercentofOBS’screditportfolioconsistsofmicroloanstoentrepreneurs,ofwhich40percentaregrantedtoagriculturalhouseholdsvaluedatupto€5,000(U.S.$5,500)each.Table1providesanoverviewofOBS’sperformancetodate.

Opportunity Bank Serbia has a large rural portfolio, with a particular focus on providing loans to entrepreneurs and agricultural households, which presents unique opportunities and challenges to implement a DFA.

Introduction

TABLE 1

Opportunity Bank Serbia Overview

Geographic region: EasternEurope

Headoffice: NoviSad,Serbia

Regulatory status:Bank

Year established: 2002

Total clients:30,000

Loan portfolio:U.S.$68million

Total disbursements:U.S.$296million

Number of branches: 8,and14creditoffices

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Overview of the DFA at OBS

In2013,OBSlaunchedaDFAtoexpandaccesstofinancialservices(particularlyforclientsinruralareas),increasecustomersatisfaction,andpromoteefficiency.OneofthemajorgoalsfortheDFAistoenableclientstoapplyforloansand,usingautomatedcreditscoringtechnology,receiveanear-finalcreditdecisionwhiletheloanofficerisstillconductinganalysisinthefield.

OBS’sDFAisanAndroidapplicationinstalledonatabletthatloanofficersusetocaptureclientandloandetails.Theapplication

FIGURE 1

DFA Overview at OBS

operatesinbothofflineandonlinemodes,whichallowsittoconnectdirectlytothecreditbureauandtothecreditscoringmoduleofOBS’scorebankingsystem(CBS),fromwhichitreceivesacreditscorethatinformsstaffandtheclientofthenear-finalcreditdecision.Approvedclientsthenvisitthebranchtosigndocumentsandreceiveloanfunds.Moststepsofloanprocessingoccurinthefield,butthefinalsteptakesplaceatthebranchforregulatoryandsecurityreasons,becausesomedocumentsmustbesignedpriortodisbursement,andOBSfieldstaffdonotcarrycash.Figure1providesanoverviewoftheDFAtechnologysolutionatOBS.

CBS / MIS Integra�onal Layer

MFB Head Office

Loan Officer

DFA Mobile App

AVAILABLE ONLINE OR OFFLINEVIA INTERNET/WIFI/GPRS

Client Registra�onLoan Applica�onSPM

Credit Scoring

Credit Bureau

7Digital Field Applications: Case Study - Channels & Technology, Accion

OBS designed its DFA to advance an organization-wide push to further automate credit-scoring and decision-making in the field for low-riskloan applications.

Implementation Process

Planning & Analysis Phase

Traditionally,loanofficerswouldvisitaclientinthefield,capturedataonpaperforms,andreturntothebranchestoinputthedataintoanExcelspreadsheettoanalyzeandscoretheclient,usingascorecarddevelopedfromagriculturalpricingandmarketinputs.TheoutputofthisExcelanalysiswasasummaryreportthatwasprintedandpresentedtothecreditcommitteeforafinalcreditdecision.

ThepotentialtoimprovetheefficiencyofthisprocessandenhancecustomerservicewascleartoOBS.Theoldapproachoftenrequiredloanofficerstomakemultipleclientvisitsduringtheloanapplication,eithertoaddressglitchesinnonstandarddatacollectionprocessesortocorrecterrorsthatweremadeusingthepaperforms.Theserepeatvisitswerecostly,inefficientforclientsandOBS,andpreventedOBSfromadheringtothehighlevelsofcustomerserviceitdeemedimportant.AnotherinefficiencythatOBSidentifiedwasthesignificantamountoftimecreditcommitteemembersandloanofficerswerespendingtoanalyzerelativelylow-valueloanapplications,aprocessthatcouldpotentiallybeautomated.Lastly,alargeamountofdatabeinginputintotheExcelsystemwasnottransferredtotheCBS,makingminingofthisvaluabledatacomplicatedforOBS.OBSthereforechosetoincreaseitsuseofdigitalcreditscoring,to

furtherautomatedecision-makingforlow-riskloanapplicationsandenableloanofficerstodirectlyaccessthesystemwhentheymetwithclientsinthefield.

Thefirstphaseoftheprojectwastodefinethebusinessrequirements,whichinvolvedadetailedreviewandrationalizationofthedatathattheloanapplicationformcollected.Thisprocesstookseveralmonthsandrequiredadedicatedteamofagriculturespecialists,riskmanagers,andITstaff.Eachdatafieldwasjustifiedtoensurethateitheritwasdirectlyrelevanttotheeventualcreditdecisionorrequiredforothermandatoryreportingpurposes.Thisledtotheeliminationofsomeunnecessarydata.ThisprocessalsohelpedstaffdeterminetherangeofproductsandloansizesthatcouldcomfortablybeanalyzedusingtheDFA.Theresultwasafinallistofapproximately200datafieldsthatneededtobeincludedintheDFAandamanagementdecisiontousetheapplicationonlyforagriculturalloansvaluedatupto€3,000.

ThecentralroleofthenationalcreditbureauintheapplicationprocessmeantthattheinformationitprovidedwasakeyinputindeterminingtherequirementsfortheDFAsolution.ForOBStoensurethatanear-finalcreditdecisioncouldbeprovidedinthefield,itneededtoverifythattheclient’screditbureaureportdidn’tadverselyaffecttheapplication.

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Fortunately,theOBSDFAprojectcoincidedwiththenationalcreditbureau’sreleaseofanintegrationinterfacethatallowedOBStobuildanelectroniclook-up,retrieveabureaureport,directlyloaditintotheOBSsystem,andincludeitinthescoringanalysis.BecausedataconnectivitywasavailableinmostareasofSerbia,OBSintentionallydesignedtheDFAtooperateinonlinemodeatcertainkeypoints,suchaswhenalook-uptothecreditbureauwasinitiatedaspartofclientregistration.

Development & Implementation Phase

Equippedwithacomprehensivesetofrequirements,OBScouldthenapplytheserequirementsacrossthedifferentcomponentsofthefullDFAsolution.OBSdeterminedthatscoringcouldbehandledbytheexistingsystemandthatsystemintegrationcouldbeperformedin-house.Thisleftdevelopmentofthefront-endmobileapplicationtobesourcedexternally.Fortunately,SerbiahasavibrantITsectorwithmanysuppliersinterestedindevelopingnewapplications.Aduediligenceprocessidentifiedthebestoptionfromashortlistoffourcompanies.Inearly2014,theselectedsupplierworkedcloselywiththeOBSITdepartment,usinganagiledevelopmentapproachtorapidlyprototype,test,andbuildtheinitialversioninlessthanfourmonths.

Pilot & Rollout Phase

InMay2014,fortheinitialtestingprocessateamof“superusers”amongtheOBSstaff,pickedfortheirstrongperformanceandpositiveattitude,wereintroducedtothemobileapplicationandaskedtogivefeedbackonit.TestingsuccessfullyconcludedinAugustandtheapplicationwasdeemedreadyforpiloting.DuringthefirstmonthofusethemanualsystemandtheDFAraninparallel,butthiswasphasedoutbySeptemberwhenthesystemwasconsideredfullyliveatallbranches.

ThebiggestchallengethroughouttherolloutperiodwasovercominginitialresistancefromloanofficerswhofearedthattheDFAtechnologydiminishedtheirfocusonclients.Fortunately,thisissuewasresolvedafterafewweeksoftrainingandconfidence-buildingtoensureloanofficerscouldbalancethetaskofdataentrywiththeirnormalregimenofclientobservationandassessment.

As part of the DFA design, eachdatafieldcollectedwasjustifiedtoensurethat either it was directly relevant to the eventual credit decision or required for other mandatory reporting purposes. This led to the elimination of some unnecessary data.

9Digital Field Applications: Case Study - Channels & Technology, Accion

Six months after launch, the project was heralded as a major success for OBS, improving customer service and increasing revenue for the bank.

Impact

Today,allloanofficersworkingwithagricultureportfolioshavereceivedtrainingandmigratedtotheDFA,andthemainobjectiveofprovidinganear-finaldecisioninthefieldhasbeenachievedformorethan80percentofqualifyingagriculturalloans.Also,avarietyofclientandinstitutionalbenefitshavebeenrealized(seeTable2foranoverview).

Client Benefits

TheintroductionoftheDFAhashelpedOBSachieveunprecedentedlevelsofcustomerserviceforitstargetagriculturalmarket.Previously,thismarketstruggledfortheattentionoffinancialprovidersandoftenenduredalongandcomplexprocesstoaccesscredit.WiththeDFAinplace,nowOBSclientsreceiveanear-finalcreditdecisionduringthefirstloanofficervisit.

Institutional Benefits

√ Cost SavingsWhileimprovingcustomerservicewastheprimarymotivationforintroducingtheDFA,OBSrecognizedthepotentialtoachievedirectcostsavingsforthebankaswell.Thisincludedareductionintransportationcostsresultingfromfewerclientvisitstocompletetheloananalysisprocess.Previously,ifaloanofficermadeanerrorwhilecollectingcustomerdetails,heorsheneededtomakeasecondvisit,whichincreasedcostsandprocessingtime–bothforclientsandthebank.Bybuilding

strongdatainputcontrolsintotheappandformulatingatighterdefinitionofwhatdatawasneeded,OBSsignificantlyminimizedthechanceoferrorsoccurringandrequiringadditional client visits.

√ Efficiency EnhancementsInadditiontoprovidingclientbenefitsandcostsavings,theDFAhashelpedOBSbecomemoreefficientinseveralways.Previously,aloanofficerwouldtypicallyspendafulldayanalyzingonenewloanapplicationwiththepaper-andExcel-basedprocess,conductingaclientvisitduringworkinghoursandtheninputtingdatalaterthatsamedayorevening.WiththeDFA,theloanofficerhasdrasticallyreducedtheamountoftimespenttogatherinformation,completedocuments,andreceiveacreditdecision.Furtherenhancingorganizationalefficiencywasthedecisiontoremovethedatafieldsthatwerenotrequiredtoreachacreditdecision(initiatedaspartofthebusiness-processre-engineeringtomapouttheDFAsolution).

Likewise,incaseswheretheclient’sbusinessandbackgroundinformation(includingcreditbureaureport)didnotmeetOBSrequirements,theloanofficerreachedadecisionfasterandsavedtimeforbothparties.WiththeDFA,allloansstillpassthroughacreditcommitteereview,butnowthecommitteeisabletospendlesstimeanalyzingapplicantswithpositivecreditscores.Onceapproved,theclientneedonlybepresentinpersontosignthefinal

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documentsandreceivetheloandisbursement,whichmakesback-officeloanprocessingmuchmoreefficient.

Toassesstheimpactoftheseefficiencyimprovementsonoverallproductivity,wecomparedthenumberofloansprocessedinthefirstfourmonthsofusingtheDFAandthenumberofloansprocessedinthesameperiodthepreviousyear,notinga28percentincreaseinloanvolumesbetweenthetwoperiods.Whileparticipationinasubsidyprograminsomemunicipalitieswasacknowledgedasaninfluencingfactor,35percentoftheincreasedloanvolumewasattributedtoDFAuse.

WhereasmanyorganizationsdeployaDFAinordertoreducetheiroverallloanturnaroundtime(TAT),forOBSthiswasn’tametricforprojectsuccess,inpartbecauseitsTATwasalreadyquitelow,withanaverageofthree

daysbetweenapplicationanddisbursement.Additionally,giventhatclientsstillneedtomakethetimetovisitthebranchevenaftertheintroductionoftheDFA,thebankdidnothavefullcontroloverthetotalTAT.Forthesereasons,overallTATwasnotthemostrelevantmetricregardingthebank’sefficiencyinthisprocess.

√ Adjacent BenefitsAdditionalbenefitsassociatedwiththeDFAprojectincludetheeliminationoftheExcel-basedcreditscoringsystem,withallclientdatanowstoredintheCBS,automaticallyupdatingaclient’screditscorecardovertime.Datacollectionwasfullystandardizedandcreditpoliciesweresupportedthroughsystem-basedcontrolsasameanstohelppreventfraudorerrors.Lastly,OBShasestablisheditselfasaclient-focusedinnovatorandenhanceditsreputationinthemarket.

ClientBenefits InstitutionalBenefits

Cost Savings EfficiencyEnhancement AdjacentBenefits

Improvedcustomerservicedue to time savings and fasterapplicationresponse(acceptanceorrejection)

Reduced cost associatedwithmultiplevisitstoclient

Eliminated need to manuallyinputloanapplicationdataintoExcelspreadsheetatbranchtoobtaincreditscores

Digitalclientdata,includingSPM,storedintheCBS

Moreefficientidentificationofclientsthatdon’tmeetOBS’screditcriteria

Improvedenforcementofcontrolsandpolicy(reducedfraud,PAR)

Moreefficientcreditcommitteereviewwithfocusonexceptionalcases

Excel-basedcreditscoringsystemeliminated

ReputationestablishedasaninnovatoramongMFBs

AvailabilityofGPSdataforbothclientsandstafftoassistwithfieldmanagement

TABLE 2

DFA Impact at OBS

11Digital Field Applications: Case Study - Channels & Technology, Accion

Challenges & Lessons Learned

LookingbackonitsexperienceimplementingaDFA,OBSidentifiedseverallessons,includingtheneedtoperformadetailedrequirementsanalysisthatchallengesthestatusquoandpre-DFAprocesses.Additionalinsightsincludetheimportanceofidentifyingandworkingwithateamofsuperusersfortheinitialtesting,andofdrawingontheirenthusiasmfortheprojecttonavigateanyinitialhurdles.OBSdidexperiencesomechallengesthroughouttheproject,suchaslimitedconnectivityinsomeareas,whichaffectedcreditbureaulook-up.Also,becauseOBScommittedtobecomingoneofthefirstorganizationstointegratethecreditscoringmoduletoitsCBS,theendeavorrequiredextratime,dedicationofinternalresources,andsupportoftheCBSprovidertosuccessfullyoperateinonlinemodewhilecheckingthecreditbureau.

With the DFA, OBS loan officershavedrasticallyreduced the amount of time spent to gather information, complete documents, and receive a credit decision. OBS has established itself as a client-focused innovator and enhanced its reputation in the market.

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WhiletheImpactsectionoutlineskeyobservedbenefitsofimplementingtheDFA,thissectionexamineshowthesebenefitstranslateintoafinancialbusinesscase,usingabusinessmodeltemplatedevelopedasaresultofthisstudy.

DFA Costs

ThefirststepofthebusinesscaseistoexaminethecostsofimplementingthesolutionatOBS.Forthebusinesscase,we’vesplitthesecostsintocapitalexpenditures(CAPEX),whichareincurredonlyonce,andrecurringoperationalexpenditures(OPEX),whichareincurredannually.Table3detailsthecostsidentifiedforOBS’sDFAbusinesscase,whichtotalU.S.$54,933inyearone.

NowthatwehaveoutlinedthetotalcostsforadoptingaDFAatOBS,weturntorevenuesearnedandcostsavings.

DFA Revenues & Cost Savings

OneofthekeybenefitstoemergefromtheadoptionoftheDFAatOBSistheincreasedefficiencyoftheloanapplicationprocess,whichresultedinincreasedcaseloadperloanofficer.WeestimatethattheDFAcontributedU.S.$24,000innetincomeforOBS,asoutlinedinTable4.

Applying the business model at OBS provided a new framework to measure the DFA’s financial benefits, such as caseload increase andimproved customer service, in comparison to the costs.

Business Case

OBSalsoachievedmodestcostsavingsbyeliminatingtransportationexpensesassociatedwithmultiplevisitstoclients,asseeninTable5.

Addingthisincreasedrevenueandcostsavingstogetherresultsinatotalyear-onebenefitofU.S.$24,540,comparedwithatotalexpenseof$54,933.ThesevaluesdonottakeintoaccountamortizationofCAPEXcosts,whichwouldtypicallycoverafive-yearperiodaccordingtofinancialstandardsinSerbia.3Henceifamortizationwereincluded,OBSwouldseeapositivereturnoninvestmentinyearoneinsteadofyeartwowhenitsDFAbrokeeven.

If amortization were included, OBS would see a positive return on investment in year one instead of year two when its DFA broke even.

3 Amortizationhasnotbeenfactoredintothesecasestudiesforthesakeofcomparisonandtoshowtotalexpensesincurred.Itshouldbenotedthatmostfinancialinstitutionshaveaminimumthree-yearamortizationperiodforalltechnologyinvestments,andinSerbiathisperiodisfiveyears.

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13Digital Field Applications: Case Study - Channels & Technology, Accion

TABLE 3*

DFA Costs

Pre-DFA Post-DFA

Number of loan officers 20 20

Caseload per loan officer (28% increase in total)

200 256

Additional loans/officer attributed to DFA (35% of increase)**

20

Average loan size U.S.$1,500 U.S.$1,500

Net interest margin 4% 4%

Increase in net income as a result of the increased caseload

U.S.$ 24,000

TABLE 4*

DFA Revenues

Item Description Cost (U.S. $)

Transportation costs

Withimproveddataentrycontrolsandarationalizeddataset,thechanceoferrorsduringtheloanapplicationprocessisnowreduced.Thismeanslessneedformultiplevisits to client sites,reducingtransportationcostsforOBS.

540

Total cost savings

540

TABLE 5*

DFA Cost Savings

Cost Type Item Description Cost (U.S. $)

CAPEX Platform Costofdevelopingthemobileapplication.Alsoincludescostassociatedwithlicensingthecreditscoringmodule,instrumentaltotheDFA.(Note:thefullmodulecostwasnotallocatedtotheDFAprojectsincethesystemwasalsousedfornon-DFApurposes.)

20,000

Implementation Costofimplementingtheplatform,consideringexternalandinternalhumanresources.Includesorganizationalrestructuring,processredesign,training,andsystemintegration.

27,000

OPEX DFAsubscription

AnnualsupportfortheDFAplatform. 3,000

Dataconnectivity

Amonthly$20subscriptionfeethatincludesdevicesfreeofcharge,withbundlesofdatapre-loaded.

4,800

Devicesupport Replacementbatteriesandad-hocmaintenancerequiredfordevices.Includesanestimateof$20peruserwithreplacementonceeverythreeyears.

133

Total Cost Year 1

54,933

** Average productivity increase post-DFA was measured at 28 percent. OBS attributed this increase to multiple factors, estimating that the DFA accounted for 35 percent of the observed increase.

* Figures in tables 3, 4, and 5 provided by the MFB

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Next Steps forOpportunity Bank Serbia

Havingmetitsimmediatecustomer-serviceobjectives,OBSisnowinterestedinexamininghowtheDFAcanincreaseloanofficercaseloadsandenablethehandlingofmoreclientswithgreaterefficiency,whileretainingthebank’shigh-qualityportfolio.

Additionally,OBSisexploringhownewtypesofdata,particularlyGPSdata,canhelporganizeitsfieldstaffmoreefficientlyandcontributetofrauddetection.TheideasthebankisdiscussinginvolvemappingclientandloanofficerGPSdataforplanningandriskmanagementpurposes.Finally,OBSrecognizestheneedtocontinuallyrevisetheriskassessmentmethodologyforitsDFAtoseeifotherloantypesorlargerloansizescouldbeaccommodated.Thisreviewwillrequirethebanktobeginmeasuringportfolio-qualitystatisticsforallloansprocessedviatheDFA,todetermineifthereisanycorrelationbetweenperformanceandtheautomateddecision-making function.

SlobodanTešić,OBS’sManagingDirector,confidentlystated,“Wecan’tcontinuetoscaleaswehaveinthepastwithoutexploringthevarietyofwaysinwhichtechnologycanadvanceouroperations.OurDFAtoolenablesustooperatemoreefficientlythanwehoped–wehavemadecustomersverysatisfiedwithsuchefficientfieldservice,andourstafffeelmoreproductivehavingreducedmany

manualstepsintheirdailyactivities.WeplantofurtherdevelopourDFAsolutionandleverageasmuchaspossibletodigitizeourprocessesandservicesinthecomingyear.”

OBS acknowledges the success of its DFA to this point, and is in the early stages of identifying additional functionality, including GPS tracking and expansion to new products.

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15Digital Field Applications: Case Study - Channels & Technology, Accion

Project Team

Co-Author and Project Sponsor:CarolCaruso,SeniorVicePresident,Channels&Technology,Accion

Co-Author and Lead Consultant:GeraldineO’Keeffe,ChiefOperatingOfficer,SoftwareGroup

Project Management: AnandMenon,InterimDirector,Channels&Technology,Accion

ChristianRodriguez,Director,Channels&Technology,Accion

KathleenYaworsky,LeadSpecialist,Channels&Technology,Accion

For thoughts and comments, please join the discussion on the Center for Financial Inclusion’s blog: http://bit.ly/1hTHmqG