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Stretching the Fabric of MFI Networks

Examining experiments with MFI channel expansion
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This document analyzes cooperative ventures between MFIs and other organizations seeking to provide goods and services to people representing the bottom 60% (B60) of income distribution.

MFIs in India have been successful in providing credit services to the poor that encourage them to pull themselves out of poverty. MFI growth has drawn the attention of other organizations looking to provide goods and services to members of the B60. Pilot projects that have tried to leverage MFI networks to distribute non-financial products and services have, however, not been successful.

The study examines previous and ongoing experiments with MFI channel expansion and identifies five models of leveraging MFI networks that show the greatest potential. Key findings include:

  • Mode selection for a given product provider and MFI is critical to the success of an expansion venture;
  • MFIs can make use of their established expertise, brand and infrastructure to expand into additional spaces by partnering with capable and committed providers;
  • Type of product, relationship between MFIs and providers, and distribution, sales and marketing models are critical considerations that can burden or bolster a joint initiative.

About this Publication

By Lalwani, N. & Kubzansky, M.
Published