The Future is Now: Strategies to Improve Financial Health

"Change is a very difficult thing to do. Change is hard" - Evelyn Stark, MetLife Foundation

Financial institutions really trod a different path when they first extended microcredit and microfinance. But over time, their base of customers evolved. We moved into a world of hyper digitization. However, several financial institutions found it difficult, impossible even, to keep up with the changes.

We knew the day we started the OPTIX project that it would be a long and challenging road ahead, as we had ambitioned ourselves to work with financial institutions in four different countries- SAJIDA Foundation in Bangladesh, Banco W in Colombia, Acreimex in Mexico, and CEP in Vietnam. Little had we realized that the result would far exceed what we could have ever imagined and that we would be able to make a real difference to the financial health of their customers.

Three years hence, we have successfully helped these brick-and-mortar financial institutions to improve their financial product portfolios to serve their customer needs and also helped them to streamline their internal processes. After developing 20 pathways towards better financial health, 12 digital tools, 8 product combinations, 4 Fintech partnerships, 119 staff trainings and crunching over 220 gigabytes of data, together, we have been able to reach over 1 million people on low incomes in these four countries.

As these financial institutions continue their journey to meet the needs of their evolving customers, we hope that we have set them on the right path, and they continue to grow stronger. Watch this video to learn more about the OPTIX Project, co-designed by BFA, and MetLife Foundation.

Leapfrogging Financial Institutions into Digitized World

Financial institutions around the world are serving a new wave of customers, and serving the previously unserved and underserved communities with financial and banking services. However, as the world around has become increasingly digital and everything is just a smartphone away, these financial institutions haven’t always been able to keep up with the changes.

Under the OPTIX project, we have been working with four financial institutions- SAJIDA Foundation in Bangladesh, Acreimex in Mexico, Banco W in Colombia, and CEP in Vietnam. By helping them streamline and digitize processes, we have been able to help these institutions leapfrog into the hyper-digitized world. Whether it’s thinking about new ways to reach their customers or make lives easier for field staff or even establish successful external partnerships, together with our institutions, we have been able to reach over one million people in these countries.

Watch this video as the Quant Guy walks us through the everyday struggles of these financial institutions.

A Roadmap for More and Better Savings

The OPTIX project worked with Acreimex, a financial cooperative that supports micro, small and medium enterprises in regions in and around Oaxaca, Mexico, to understand how to offer the right incentives to low-income customers so that they could access long-term savings product that would help them build resilience. We designed a strategy informed in behavioral economics using appropriate materials that allowed the customers to make an informed and easy decisions about their savings. The aim of this was to see if they could help customers build long-term assets that would also serve their short-term liquidity needs.

Embracing Change Management to Better Serve Low-Income Customers

Banco W had spent more than three decades serving customers on low incomes in Colombia when we began working with them; they had a deep understanding of their market. However, as we began working together in the OPTIX project we also realized that while they understood their customers needs, their overall customer base was changing rapidly, as was the way Colombians preferred to do banking. Apps were taking over many of the transactions and tasks that were considered the foundation of traditional banking and we started working with Banco W to help them move with these rapid times. OPTIX helped with staff training and facilitated a partnership with a fintech to help connect them more directly with their customers. Watch this video to learn more about how Banco W is now working to encourage greater customer trust in the capabilities of their products and services and how their customers responded.

Leapfrogging an MFI in Bangladesh from ‘Manual to Digital’

Since 2015 the OPTIX project has been working with  SAJIDA Foundation, a non-governmental organization and microfinance institution in Bangladesh, to help them serve their low-income customers better by improving their ‘financial health.’ We worked out five ‘pathways’ that would impact three specific areas that together make for someone’s financial health: resilience when money is scarce, confidence in money management, and trust that financial institutions and products can help.

We also wanted to help SAJIDA and the other three OPTIX project institutions become more familiar with data-driven decision making, so their strategies had the greatest chance of success. This included helping them cope with change, including retraining field staff so they would feel comfortable communicating differently - and more effectively - with their customers. Watch this video to know more about how SAJIDA Foundation embraced the challenge of change and improved the way they’re doing business.

Improving the Financial Health of People of Bangladesh

This video tells the story of Liza Khanam of Bangladesh who owns a small boutique in the Vatara district of Dhaka. We came to meet Mrs. Liza while we were working with SAJIDA Foundation, a microfinance provider and non-governmental organization in Bangladesh under the OPTIX Project. With SAJIDA, we realized that many of their low-income clients were having to travel miles to repay  loans, taking them away from their stores - their livelihoods - in order to repay these loans at routinely center meetings. In order to service these people better, we worked on the integration of Rocket mobile money service with SAJIDA’s banking system. As a result, 71 percent of SAJIDA’s customers now say they prefer having the flexibility to make payments when they choose- thanks to the mobile money solution.

In order to truly improve the financial health of these customers, however, we also needed to find a way to help them save more and save better with a targeted approach as opposed to a bulk savings model. Along with SAJIDA, we re-designed a term deposit savings product called Astha to give people like Mrs. Liza greater financial control so they can save for their children’s future and also continue growing their businesses.

Altogether, the institutions participating in BFA’s OPTIX project will reach close to 1.1 million people on low incomes with improved financial services and products. In this video, Mrs. Liza tells her story in her own words about how she’s taking greater control of her financial health.