The story of LARDI, an MFI that quadrupled its number of clients with Oradian’s core banking system
Customer: LARDI (LAPO Agricultural and Rural Development Initiative)
Business: Microfinance institution (MFI)
LARDI (LAPO Agricultural and Rural Development Initiative) a subsidiary of LAPO, Nigeria’s largest microfinance bank that Oradian started working with in 2015. LAPO is a non-governmental organisation (NGO) committed to the social, health and economic empowerment of the underserved and vulnerable in Nigeria.
Growing a microfinance bank in a frontier market
Before implementing Oradian’s cloud-based banking software Instafin, LARDI had specific business challenges that were preventing their growth:
- High cost of growth
- No access to real-time information
- Inability to quickly produce financial reports
- Frequent errors and fraud
- No customer or technical support from the core banking provider they were using at the time
- Manual interest calculations for all repayments
“We needed to ensure that people in rural areas were given financial services. As our operations began to expand at LARDI, our three major challenges were the timely collation of reports, the high cost of monitoring our portfolio, and the ability to collate our data. We needed software that could help us, that was real-time, cloud-based and affordable. We needed to be sustainable and at the competitive edge with MFIs and commercial banks.” – Florence Omofonmwan, Head of LARDI
Florence Omofonmwan, Head of LARDI, wanted to enable LARDI to reduce operating costs at its 25 branches at the time, and be able to reach new underserved communities. By starting to use Instafin as their core banking system running completely in the cloud, LARDI no longer needed to invest time in maintenance or long hours of commute to their end-clients – everything became available in real-time, at the click of a button.
Oradian’s team relieved LARDI’s IT support from configuring networks, data backup and backup testing, recovery and recovery testing. With these responsibilities covered by Oradian, IT managers have time to focus on optimisation.
The implementation process
Instead of IT managers’ jobs being redundant, the implementation of Instafin allows them to play a more important role in the organisation, such as all integration projects with third-party providers. IT manager remain in charge of all core banking system-related topics and collaborate with Oradian’s customer support team after implementation.
Oradian develops a training plan to meet the needs of each organisation and we train a group of staff on-site, so that they can train others. Internal trainers are typically called ‘Instafin Champions’. Training is conducted on a separate instance with the same data as the live version of Instafin, meaning we can use the system and test any new features, products or operations before doing it on the live version.
LARDI was one of Oradian’s fastest completed implementations. When we started working with LARDI, we piloted on three branches for three months before implementing across all of LARDI’s remaining branches. One of the positive aspects of working with LARDI was that they were a mature organisation that had already been using a core banking system in the past. Because the staff was already introduced to the use of a banking solution, the training was completed in two days.
“After LARDI implemented Instafin, we were able to access all our branches at one spot, reduce the time spent on consolidating reports on a monthly basis, and manage users from the same spot, which reduced the risk of unauthorised uses.” – Enogieru Osagie Marvellous, Head of IT, LARDI
Cost efficiency – Accuracy – Growth – 85,000 more people financially included
Instafin’s business intelligence module allows IT managers to build any report on their own and provides more flexibility in terms of working hours. At any moment of the day or night, IT managers can control what is happening in the system and in case of cash discrepancies at a branch, with Instafin, there is no need to close the branch for the calculations to take place – it’s done automatically at midnight every day.
We have seen LARDI reap noteworthy benefits after transitioning onto Instafin. This is due to our platform’s focus on core functionality, transparency, ease-of-use and access to the information needed to manage a business.
“From an IT manager’s perspective, the end result of implementing Instafin is that our customers’ IT can concentrate on providing more real value to their organization and not maintaining infrastructure for third-party software. IT management is much more than maintaining core software – it’s managing, connecting and integrating different systems throughout the company, as well as providing security and availability for all parts. It is also choosing IT solutions that provide the best value for the company and reduce overhead in maintaining segments that aren’t the institution’s core business.” – Domagoj Smoljanovic, Infra Team Lead at Oradian
The key benefits LARDI received with Instafin:
1. Reduced costs
Because LARDI operates in rural areas, people used to travel just for monitoring branches. Going to these rural areas was a high cost for LARDI. Since LARDI started using Instafin, the team just looks at the information on Instafin and they know which area they need to visit. With all LARDI’s transactions available in real-time, their cost of operations dropped drastically.
2. Reduced paperwork
Before Instafin, LARDI was doing a lot of their work manually. The speed of collecting their data has rapidly increased after implementation.
3. Better portfolio management
Prior to implementing Instafin, LARDI had to wait until the end of the month before they could see how their portfolio was performing. With Instafin, they can click instantly and see all their transactions on a daily basis.
4. Better institutional performance
LARDI operates in 19 states of Nigeria. With Instafin, LARDI can get the information about all the transactions that are going on in those 19 states, which took significantly longer before implementation.
5. Improved loan performance
LARDI now uses Instafin to know the different types of loans they manage and which one is performing better than the other.
6. Client data management
Before using Instafin, the total number of clients that LARDI had was difficult to calculate, but with Instafin, the number is available online.
The story of LARDI, that quadrupled its number of clients with Oradian’s CBS
LARDI in 2014
LARDI in 2018