Peru HDI Peru: 0.723 HDI Apurimac: 0.521 Rank Peru: 63/169

[email protected] www.e-mfp.eu

Rural Outreach and Innovation e-MFP Action Group: Lessons learned from member based MFIs on governance and strategic alliances

Moderator Laurent Biot, SOS Faim Speakers Victor Chati Perez, Coop Los Andes (Peru)

Alou Sidibe, Kafo Jiginew (Mali)

Luis Panzer, Cresol (Brasil)

Maira Gonzales, Coop. Jardin Azuayo (Ecuador)

With contributions from Bernard Ornilla (Alterfin), Lamarana Sadio Diallo

(CRG-Guinea), Anaïs Perilleux and Annabel Vanroose (CERMi)

Luxemburg, November 4, 2011



The experience of the Savings and Credit Cooperative Los Andes (Peru)

Presented by Victor Chati Perez, Los Andes General Manager


Peru

HDI Peru: 0.723HDI Apurimac: 0.521Rank Peru: 63/169


Presentation

Created in 2001 Coming from a rural microcredit program (1999) Founders: 5 rural communities Very rural focused, basically with savings and credits

Some figures Los Andes, in constant growth:

28,620 active Members (44% women); 97 salaried workers 21.63 M$ credit portfolio; around 85% of credit lines covered by

savings. 25.3 M$ equity and liabilities 114.9% OSS; OE/assets 9.93% 1,419 USD average loan size PAR30 is 2.3%


Governance

Cooperative model Decentralized and participatory: 12 offices and 42

service points Every office has elected representatives

They control operations They represent the members in the General Meeting (100

representatives) The law prohibits participation of the members in the credit

committee but they design the credit policy

For this model to be performing, Los Andes puts its efforts at two levels: Cooperative training Territorial focus: the Coop acts as an active actor in local

development


Strategic Alliances

Natural alliances with local partners: Villages associations / Farmers´ associations and local governments Strategic alliances with international development organizations But in the current context and for the model to be sustainable at long term, need to build new alliances with peers

Creation of CIDERURAL (2008): Second floor cooperativeObjective is to:

Exchange experiences and to learn from each other Economies of scale (TA, training, audits etc.) Financing possibilities Lobby, national representation

Creation of the Union of cooperatives from Apurimac (2011): with any type of cooperative

Make the local economy more dynamic Representation



The experience of Kafo Jiginew (Mali)

Presented by Alou Sidibe, Kafo Jiginew General Manager


MaliHDI: 0.309Rank: 160/169


Presentation

Created in 1987 in the South of Mali: cotton area Supported by an NGO consortium and the Crédit Coopératif Français Took its autonomy in 1994 Network: 19 local branches – 5 Regional Delegations – 1 Union – 167 service points

Kafo in figures of September 2011 302,000 Members – With 27% of women 647 employees Credit portfolio reaches: 33.29 millions of dollars (M$) and total

savings: 32.64 M$ 106.2% operationally self-sufficiency and 98.5% FSS OE/Assets: 13.48% – Borrowers/staff: 84 612 $ average loan size 7.3% PaR30


Governance

ReconfigurationFinalized in 2010

From 113 local branches to 19 branches But conserve the 167 service points From 22 elected presidents at Union BoD to 9

Advantages: Increases efficiency (speeds up decision process) Reduces strongly the operating expenses Easier to meet regulatory norms Improves professionalization

Disadvantages: Weakens the link with members


Governance

Diversification in order to reduce risk (reduce dependency on cotton sector) Geographic diversification

Creation of new local branches Urban: Bamako and Kayes Rural: Office du Niger Head Office transfer to Bamako

Sectorial Diversification of services

Finance new activities (other activities than cotton production)

Result: the portfolio dependency on the cotton sector reduced from 85% to 45%


Strategic Alliances Multiple partnerships

Strategy convergence (defined by Kafo Jiginew) E.g. Geographic diversification

Rural – Office du Niger (rice) (SOS Faim – FAIR) Urban – Bamako (with own funds)

One crucial partner: the Confédération des Institutions Financières (CIF)

Regional partnership: CIF groups 6 financial cooperative networks in 5 West-African countries

Same type of institutions: know very well the challenges of each other Exchange of experiences and expertise

- E.g. Reference group on agricultural finance Increases independence from external technical support Possibilities to implement new tools and to mutualize services, e.g. bank

and insurance company



The experience of CRESOL (Brazil)

Presented by Luis Panzer, CRESOL General Director


II. CasosII. CasoslatinoslatinosII.3. CRESOLII.3. CRESOL

Brazil

HDI: 0.699Rank: 73/169


Presentation Created in 1995, with the objective to help local rural communities to access credit and savings Coming from social movements Works intensively with government programs Decentralized institution: network of cooperatives (79) composed by rural families Active in two Southern regions of Brazil, currently considering expansion CRESOL in figures of December 2010:

41,200 savers and 45,023 active borrowers (18.38% women) 100% rural activities 417.7 M$ credit portfolio and 137.3 M$ savings 118.6% OSS; OE/ assets: 5.36% 3,800 USD average loan size 2.81% PaR30


Governance

The MBOs are all initiated locally and directed towards rural families; average number of members: 500-2,000. CRESOL puts a lot of effort in the decentralization of the COOP so that the management stays in the hands of the farmers. Therefore all members and directors receive training. All committees (e.g. credit, audit) are composed of members and consequently decisions are taken by the community

Recently discussion towards putting “managers” in charge of the operational tasks

Three level system: local, regional and central level MBO is a network: have local and regional meetings and a central

cooperative who manages the IT system, is responsible for audit, lobby and advocacy towards external partners

Principio Solidario: Local COOP is “guaranteed” in case of default, by its regional service centre who covers 70% of the losses


Strategic Alliances

All the cooperatives have constructed alliances with local organizations (trade unions, NGOs, producer oriented cooperatives) => member has access to different services Has developed different activities with other institutions

Training activities (training of credit officers) with Infocos To create access to insurance products for its members, CRESOL created

alliances with MAFRE, Liberty, HDI etc. The CRESOL system has national alliances with the government, banks and national cooperative systems.

Banco de Brasil (public-private bank) and the BNDES (National Development Bank)

Central CRESOL is member of Unicafes (National Union of Cooperatives) and Confesol (National Union of Credit Cooperatives)

Support of international partners such as Trias, Rabobank Foundation, BRS etc. Receives technical support which have been decisive in the growth process



The experience of Savings and Credit Cooperative Jardin Azuayo Jardin Azuayo (Ecuador)(Ecuador)

Presented by Maira Gonzales, Jardin Azuayo Treasurer


EcuadorHDI: 0.695Rank: 77/169


Presentation

Created in 1996, as a response to local disaster in the village of Paute

Currently the second biggest MBO in terms of assets in Ecuador Decentralized institution: 27 offices and 3 service points

JA in figures of October 2011: 205,000 Members (52% women borrowers); 289 employees 70% rural members 205 M$ credit portfolio and 191.5 M$ voluntary savings 120.7% OSS and OE/assets: 4.14% 4.830 USD average loan size 2.80 % PaR30


GovernanceCooperative model - Training focus: Educational programs towards members, directors and employees

Effects: Strong appropriation and embeddedness, people know very

well the cooperative Contributes to local development Social control of the operational part of JA Balance between social and financial objectives

Decentralized governance model, except for the technical areas of the 27 offices

Effects Services and products adapted towards the needs of the

clientsFor example: remittances, shared financial services within national cooperatives


Strategic Alliances Started with the support of a local NGO called CECCA (NGO specialized in

education and training of farmers) but without international support.

Local development organizations Red de Mujeres de Paute, local governments, producer organizations

Effects: Alliances, part of local development, knowledge of the environment etc.

Member of several microfinance networks in Ecuador Red Financiera Rural, Ucacsur y FINANCOOP: ratings, publications,

trainings, product supportEffects: representativeness, knowledge development, products

and services, financing

International partners and organizations Since 2003 started to build international alliances: FUSM, BID (B-loan),

AlterfinEffects: technical support, long term financing, development of

new products


Thank you for your attention!

Peru HDI Peru: 0.723 HDI Apurimac: 0.521 Rank Peru: 63/169

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Transcript of Peru HDI Peru: 0.723 HDI Apurimac: 0.521 Rank Peru: 63/169