Data Processing and Data Processing and AnalysisAnalysis

“Do we have a market?”

Session 5 Objectives

The participants will learn:

• How to process survey interviews

• How to analyze the data gathered by the different tools

• How to assess whether an area has a good microfinance market or not

Two Parts of Session 5

Part 1: Processing the survey interviews using:

Handout 1 – Tabulation Sheet & Summary Tables

Part 2: Analyzing the data:

Handout 3 provides a format for the market research report.

Processing Survey Interviews

Part 1

Handouts and other requirementsHandout 1 will be used for primary data

tabulation and for processing summary tables

You will need a computer unit with excel software to use the tool.

However, without a computer, you can process the data manually.

Encoding activity and preparation of data tables

Using the questionnaires that the trainees completed:

Demonstrate manual processing of data using Handout 1 and summarizing results using Handout 2.

Repeat the exercise using the computer and Excel spreadsheet.

Analyzing the Data

Part 2

Tool: Handout 3

Sample Report in Handout 4

What Is A Good Microfinance Market?

• Has “enough” potential clients

• Has limited competitors lending to microenterprises

• Has stable business environment with limited risk factors

What Should Be The Minimum

Market Size?

• The trade area should have enough potential clients for, at least, two Account Officers (AO).

• Optimum load for an AO doing weekly pick-up collection is about 150

• This workload can be higher or lower depending on:

Distance of area from the bank, and how dispersed clients are

Whether clients pay at the bank or not

Frequency of collection

What Should Be The Minimum Market Size?

Sample: Assume a client drop-out rate of 10%

To compute for total number of new clients, use formula:

Total No. of New Clients = (150 clients per AO * 2 AOs)/(1- Drop out rate)

The total number of new clients that the two AOs should bring to the bank over a period of, say, two years should be 333 microenterprise operators.

What Should Be The Minimum Market Size?

• Assuming that the total number of ME operators who want to borrow and are eligible for loans are 25% of the total

• The minimum ME population should be 1,333

Total ME Pop. = 333/0.25 = 1,333

Competition in the Microfinance Market

• Serious MF players - can be a bank, cooperative, lending investor or NGO with sufficient resources in large-scale microfinance operation

• Has a track record of at least three years of viable microfinance operation

• Present client outreach of other MF players covers communities targeted by your bank

What Are The Critical Risk- Mitigating Factors?

• Household income sources are diversified

• Little or no distinct seasonal income fluctuations

• Occurrence of natural calamities not frequent

• No impending local government policy or action that would disrupt the normal operations of microenterprises

• No competition from a credit program of the local government or other government entity.

What Are The Critical Risk-Mitigating Factors?

• No frequent disturbances in, or major threats to, the local peace and order situation

• Low rate of migration

• Home ownership is widespread

• Experience of the bank and other institutional lenders in lending to the people has been satisfactory

What Are The Critical Risk-Mitigating Factors?

• Potential clients who do not have previous or current experience borrowing under subsidized, government-assisted credit programs

THANK YOU!