Building the capacities of the staff of member organizations was a tough challenge for the LMFPA during the year 2020 with the spread of COVID 19 pandemic. In fact all training workshops of LMFPA came to a complete standstill when the government announced an island wide lockdown in March 2020 and the priority shifted towards assisting member organizations to recover from the pandemic.
With the restrictions imposed on public gatherings, the LMFPA sought to conduct its capacity building programme through online meeting platforms in 2021. Therefore LMFPA’s first virtual training programme was held on 24th February 2021 on “Managing Lending Risks under the new normal”. The training was conducted by Mr. Priyantha Dematagoda, CEO of Sewa Community Credit and Vice President of LMFPA.
In the programme, Mr. Priyantha Dematagoda expounded on the importance of identifying credit risks and adopting sound practices for managing them such as having a Credit Risk review system, proper and systematic collection/recovery/follow up procedure and the persistence of follow up microfinance clients. There is a danger of declining sales and closure of certain small scale businesses such as those in the tourism industry, however on the other hand there are opportunities for growth in other industries such as healthcare, online-trading and telecommunications. Prior to the pandemic, challenges faced by MFIs were collection, recovery, supervision and monitoring. Under the new normal environment additional challenges have emerged for an MFI in the form of restrictions on meeting clients for credit appraisals, organizing centre meetings, conducting home visits for recoveries and managing teams remotely and more importantly understanding risks and viability in businesses, within the supply chains. This forces the MFIs to think creatively to ensure its sustainability.
A total of 33 participants took part in the programme which was very promising start for the LMFPA training calendar after a long hiatus. Similar programmes are now being designed according to the needs analysis received from the membership and the LMFPA intends to organize them soon in partnership with the technical service providing institutions in the membership.