The Benefits and Strategies of Successful Savings Mobilization: Experiences from Grameen Foundation and CARD Bank (Part 2 of 2)

Ms. Julie Peachey

During the 2011 USAID supported Rural Bankers Association of the Philippines – Microenterprise Access to Banking Services (RBAP-MABS) Program Regional Roundtable Conference, Grameen Foundation Project Manager, Julie Peachy, shared the results and findings of the CARD Bank Savings Mobilization Project. The project is a three-year effort aimed at reaching 1.45 million new savers in the Philippines, India, and Ethiopia. The savings product being pilot-tested, the Matapat, is a voluntary savings product designed to allow savers to make small and frequent deposits. Several options are available to encourage clients to make deposits: during center meetings, via over-the-counter deposits in bank branches or microfinance bank offices (MBOs), and through deposit collections by savings associates. Withdrawals, on the other hand, can be made at ATMs, in addition to the traditional over-the-counter withdrawals.

Ms. Peachy gave some of the results and pilot test findings. First, she said that savings for kids’ education; pooling money for additional business capital, emergencies, payment for utility bills; and having another savings account aside from the voluntary savings account are among the primary motivations for savings.

Ms. Peachy gave some of the results and pilot test findings. First, she said that savings for kids’ education; pooling money for additional business capital, emergencies, payment for utility bills; and having another savings account aside from the voluntary savings account are among the primary motivations for savings.

On the other hand, savers cite accessibility, or the ease of withdrawing funds from the account when needed, as the most valued product feature. They also value the product for its low maintaining balance, the range of deposit options, and account privacy.

In conclusion, Ms, Peachy said that effective savings mobilization requires the involvement of the entire organization. The project must also be built on the basics – a thorough understanding of customers via market research and a disciplined product development process. Human capital management practices must also be in place to effect change. The business case and business model also have to be well defined.

Ms. Peachy clarified that so far, results show that there is no correlation between savings and poverty level, and points to the fact that the poor can indeed save.

Ms. Peachy admitted that initially, CARD Bank faced challenges in training the staff to sell and promote a voluntary savings product. Initially, they had a separate group handling the voluntary service, but they soon found out that was not a very efficient way to promote the new savings service so it is now promoted by all the staff.