Leaping into the cloud to cut hidden costs 

Microfinance Banks (MFBs) and Microfinance Institutions (MFIs) in Nigeria are operating in a highly competitive environment. To ensure that your clients continue choosing your institution first, you must meet their demands for services, grow your business and get ahead of the rapidly changing digital financial environment.  

One way to overcome the challenges that face your business and hinder your growth is to choose the right core banking system that will align with your growth strategy. With a proper core banking platform in place, your financial institution can steadily grow, reach more clients and serve them better. Which core banking platform is right for your business? 

When comparing on-premise to cloud-based core banking systems, the differences are usually summed up by referring to how the core banking platform is hosted – where is it? However, there are other aspects that could greatly impact the future of your business and its growth: hidden costs

With Instafin, Oradian’s cloud-based core banking system: one subscription feefor everything, including implementation and training 

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On-premise costs can quickly add up to more than the price of a subscription to a cloud-based system 

At first glance, on-premise systems seem affordableAs financial institutions try to grow their business with an on-premise system, hidden costs unfoldFor years, this has been the only option. Cloud technology enables your financial institution to have more options that can better align with your strategy.  

Cloud-based core banking platforms provide access to a world-class banking services at the click of a button and at a single, fixed subscription fee with no hidden or other associated costs. 

The hidden costs of on-premise banking systems 

With an on-premise core banking system, you must pay the direct costs of the hardware and software up front. Then, you pay the indirect costs:  

  • Electricity to run the on-premise system
  • Maintaining and repairing the system every year 
  • Backing up data and ensuring its storage 
  • Lost data that you cannot recover if there is a disaster 
  • IT specialists’ time 
  • System down-time  

These indirect costs strain your financial institution’s budget, which otherwise could be used for the core business and reaching your growth goals. The cloud gives you access to world-class core banking platform without investing in the infrastructure.  

Most of the costs of an on-premise system are not included in the proposal from the vendor, as they are incurred on an ad-hoc basis from the vendor, or you pay for it directly as a regular or extraordinary business expense.  

The iceberg infographibelow is used to show the costs above the water are the ones which are known and visible and the hidden costs are below,  hidden from your view. Most times, hidden costs below the water are much more than the costs you can see – the tip of the iceberg. 

You should only be responsible for your Internet, not your infrastructure 

The costs of on-premise systems can quickly add up to more than the price of a subscription to a cloud-based platform. When building an on-premise system, your institution also assumes the full responsibility of integration and any security or IT related issues.  

For financial institutions, data security is of vital importance. Partnering with the right IT professionals for data security and recovery will reduce costs and ensure your business growth – at all times.  

As the leader of a financial institution, the question you should ask is:  

  • Will this system enable my financial institution to grow in a sustainable way for the next five to ten years?  
  • AI making a decision that aligns with my business strategy? 

The key to growing is to cut hidden costs and to grow faster in a competitive market 

One way MFIs and MFBs are streamlining these processes is through technology designed for efficiency. Oradian designed its cloud-based core banking system specially for the microfinance industry in emerging markets. This is because the cloud has proveto dramatically reduce costs and enable MFIs and MFBs in remote, hard-to reach communities to work more efficiently and focus on the core business.  

With a cloud-based banking platform, customers in rural areas reported an average reduction of 60% in costs for opening a new branch, allowing them to rapidly expand. 

Core banking platform as a subscription service

Oradian’s cloud-based core banking platform, Instafin, provides a single, fixed subscription fee with no hidden or other associated costs. With Instafin, you get automatic updates at all of your branches for no extra cost. Instafin is instantly updated and rolled out to your business without any extra hassle for you. 

Oradian maintains, upgrades and backs-up the system and all your data. With Instafin, you run you reduce your operational costs which allows you to focus on your core business of providing financial services to your community. With the latest technology, you can always be ahead of your market.

Software costs are included in the subscription  

  • No need for maintenance or backups of the system  
  • Monthly upgrades of system at no additional cost  
  • No need to hire IT specialists to fix bugs  
  • No need for VPN  
  • No additional cost for software maintenance 

Now, your IT staff can provide real value to your core business  

Clouds spare you the time and resources of maintaining and updating the system, data backups, storage and disaster recovery. From an IT manager’s perspective, the endresult of implementing Instafin is that our customers’ IT can concentrate on providing more real value to their organisation and not maintaining infrastructure for third-party software.” – Domagoj Smoljanovic, Infrastructure Team Lead at Oradian. 

You cut downtime and ensure business continuity – at all times  

On average, microfinance institutions lose 15 days per year to system downtime and system failures which affect: 

  • The quality of services they provide to their clients, leading to unsatisfied clients and even the loss of some. 
  • With Instafin, MFBs are not required to interrupt their business operations for EOD or (EOM) processing. All relevant calculations, transactions and entries happen automatically, with no downtime. 

Because of Oradian’s data backups and routine tests, you have 99% uptime – guaranteed. 

Reduce costs and support your long-term growth

Reduce costs and extend reach with Instafin 

  • Low cost to open a new branch 
  • No need for new hardware 
  • No need for new software licenses 
  • No need to hire an IT specialist team 

By outsourcing their banking platforms, MFBs are reducing overhead costs and focusing on their core business:providing financial services to Nigeria’s underserved population.

ScalabilityYour growth and expansion are cost effective 

As your business grows, and once you reach more clients and have to deal with more data and services, you will need more capacities and technical resources. On-premise systems are unscalable and lack the flexibility needed to accommodate your growth.  

Cloud technology enables banks to quickly respond and scale processing capacities in order to respond to the fast-growing demands of clients. Instead of buying a new server to accommodate your expansion, your team can scale up in the cloud. With a cloud-based platform your financial institution can roll out new services quickly and cost effectively 

Visionary financial institutions around the world are moving to the community cloud to make their operations more secure, more efficient and more affordable. Ready to join them?