Core banking solutions enter micro finance segment

Bangalore, Mar 7 (UNI) Financial Information Network and Operations (FINO) today announced the launching of core banking in a Micro Finance Institution for the first time in the country with the recipient being Janalakshmi Social services.

Janalakshmi is a urban micro financing organisation catering to the credit requirements of urban poor covering around 40,000 families in Bangalore with the cumulative credit sanction expected to touch Rs 24 crore this fiscal.

FINO floated by ICICI Bank with equity participation to the tune of 40 per cent from external financial agencies and 30 per cent from four public sector banks--Indian Bank, Oriental Bank of Commerce, Union Bank of India and Corporation Bank had tied up with IBM to develop an innovative delivery platform using IFLEX banking solution to power micro finance.

FINO CEO Manish Khera told newsmen that before March 31 three other Micro Finance Institutions, two in Tamil Nadu and one in Orissa would go live with the FINO Solutions. FINO would be investing around Rs 80 crore on technological inputs to cover around 200 institutions across the country touching 25 million customers of Micro Finance. ''Though initially we do not expect good turnover, on the fifth year the turnover should be Rs 500 crore, with profits amounting to 20 per cent'' Mr Khare said adding that FINO would adopt a pay by use pattern for revenue generation with each MFI expected to pay around Rs 25 to Rs 30 per customer per year.

Under the scheme the MFIs would not be investing into the necessary IT infrastructure or necessary manpower. It would be outsourced to FINO which would store information at a IBM Database in Bangalore.

MORE UNI