Digital Transformation in MSME Finance: Beyond Payments and Digital Credit

MSME Finance Institutions are under strong competition for customers. Mobile Phones, Calls and SMS (sometimes even internet) are utilities for everybody nowadays. MNOs are taking advantage of this privileged market position to expand their service offering. Also, finTechs are deploying new products on a daily basis, making not only payments but also credit and savings ubiquitous.

Building Blocks of Digital Transformation in MSME Finance

Financial Institutions hence need to embrace digital transformation and find new ways to maintain and recapture market shares. Replicating and integrating “digital” will not be enough: organizations need to digitalize more than only their customer experience to become agile enough to succeed in this market. Also: digital leaders outperform their peers consistently.

The building blocks of digital transformation in MSME Finance can be summarized along four dimensions: 1) Customer Experience, 2) Operational Processes, 3) Business Model and 4) Digital Capabilities. The digitalization of Customer Experiences is well on track, yet, to leverage these effectively – processes, business models and digital capabilities need to follow suite. This is where we come in: fin-BITS focuses on 2) and 3), while our sister company PCES is prolific in 4).

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