Microfinance Marketing 101: The Loan Officer
By Stephanie Sibal, KF14, Cambodia
In the last few weeks, while hopped up on caffeine from too many cups of instant coffee, when I was approached and asked to create a marketing plan for MAXIMA, the microfinance institution (MFI) hosting my Kiva Fellowship in Cambodia, I overeagerly agreed.
Prior to my fellowship, I spent some time working in public relations, so the task of creating a marketing plan wasn’t completely new to me. In order to get started, I needed to figure out how MAXIMA markets to its borrowers in the first place. I knew the first place to start was the ever-important loan officer.
“Today, we’re advertising.”
Loan officers have an unbelievably difficult and labor-intensive job. They have a long list of responsibilities: traveling long distances to meet with new or existing clients, disbursing a microloan, and collecting repayments. (Previous Kiva Fellows have written about the jobs of loan officers, in Vietnam and Ecuador)
Last week, I asked to tag along to with Vanna, one of MAXIMA’s loan officers, and found out exactly how crucial loan officers like him are to MAXIMA’s marketing program.
In short, he and other loan officers like him ARE the marketing program.
By nature of his job, Vanna is the main point of communication between lenders and borrowers. He explained to me that when he finishes visiting with clients, his next main task is to “advertise” and seek out new clients. This means, of course, asking current clients if they know of anyone who is interested in starting a business and in need of a loan, or meeting with neighbors of a client.
We leave the office bright and early at 7:30 a.m., grab some baguettes for lunch on the way. The rest of the day was spent meeting almost a dozen different people. I watched him as he explained the terms and processes associated with taking out a small loan, and also let borrowers know about new products—a new type of loan, or the availability of a savings account. In essence, loan officers are a microfinance organization’s PR people.
Because of this, an MFI’s human resources department (if one exists) is tasked with hiring the right people—hopefully natural communicators, and candidates who know their territory. MAXIMA in particular, has a number of loan officers who hail from the very provinces they are serving, which makes it easier to create and build relationships with borrowers.
Listening and growing with the needs of borrowers
Once a borrower is finished repaying their loan, it’s important to listen to client feedback in order to move forward and continue the level of service that an MFI promises. In MAXIMA’s case, it’s through listening to client feedback that they developed a new type of loan.
The new loan product includes a different loan term and amount than MAXIMA’s other loan products, all requested by MAXIMA’s borrowers. It’s now one of their most popular loans to date. Kimseng, MAXIMA’s executive director, explained to me that much of this is affected by the changing purchase power parity in the country.
Loan officers such as Vanna now have an additional task of gauging borrower response to their satisfaction with their loans, and must know the right questions to ask in order for MFIs like his to create or change their products to truly serve their customers.
“The relationships we have with our borrowers are what make us so different,” said Kimseng. “It’s why we are here to work.”
Keep microfinance in motion. Lend to an entrepreneur on Kiva today!
Stephanie Sibal is a part of Kiva’s KF 14 Class working with MAXIMA Mikheranhvatho Co. Ltd. In Cambodia. Her least favorite phrase in marketing/business jargon is “low-hanging fruit.”
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