Digital Transformation of MFIs: Analysis of the Progress in Latin America (only in Spanish)
Technology has disrupted practically all human activities. The way we do chores, even the most common and simple, have changed drastically. Even if changes in everyday chores have been general and at times even unnoticed, the same has not been the case with Microfinance institutions (MFIs).
Until recently, particularly before the crisis from COVID-19, digital transformation was taking place gradually and dissimilarly between countries and MFI. Some MFIs had embraced technology with enthusiasm and some others, on the contrary, were doing it slowly and dispersed.
This study reveals that it is clear digital transformation varies among type and maturity level of the MFI, as well as the market and country in which the MFI operates. Access to technology, availability of interconnectivity and regulation in force, also plays an important role. Overall, it is clear there is no magic formula for MFIs to conduct their digital transformation.
MFIs will need to adopt technologies that allow them not only to face the crisis but to continue operating in an efficient manner and meet the needs of their clients. Simultaneously, the COVID-10 pandemic showed that the human touch is longed and necessary, and for that reason a healthy balance between digitalization and social contact must be seek.
This document presents a summary of the current situation of Latin American MFIs regarding the level of progress of their digital transformation processes, hoping this study will allow MFIs to identify the opportunities and threats faced the market they serve.
Written by: Fabián Garrido, Jonathan Ureña, and Guillermo Gayle. July 2020.