On a recent visit to MFIs working in eastern Uttar Pradesh, we chanced upon some great innovations and field practices, which are clearly taking customer focus to the next level. In this post, I elaborate on the innovation we saw at Utkarsh Microfinance in Varanasi. To give a brief background, Utkarsh, started by Mr. Govind Singh, formerly of ICICI Bank, is one of IFMR Capital’s early partners and has shown tremendous performance over the last four years, having grown to a remarkable scale rapidly. Currently they have reached out to almost two lakh financially excluded women in five States.
One of the means by which Utkarsh has sought to ensure that they don’t lose sight of what is important for the client is by putting in place a mode of communication through which their clients in remote areas can reach the management directly. This has been done under the guise of the grievance redressal system. While the model code of conduct mandates all MFIs to have in place a grievance redressal number, Utkarsh has taken it a step further and put in place a system that allows for better access and analysis.
The grievance redressal system at Utkarsh, approved by the board and senior management, provides for three levels of access for the client –
- The branch personnel
- A complaint box for anonymous feedback at each branch (branch personnel have no access to this box)
- A toll free number
While the first two are for access at the field level, the toll free number provides clients direct access to the management at the corporate office at Varanasi. The toll free number is well advertised, being displayed at each branch and also being present on each loan card that is issued to customers. There is a dedicated three-member cell at the corporate office that deals with the calls that come on the toll-free number. The Grievance Redressal Cell is a part of Utkarsh’s “Responsible Finance” Division, which concentrates, aside from customer grievances, on other metrics of responsible finance such as social performance. At all times during working hours, there is a designated “Responsible Person” who attends to and registers client grievances. The cell is allowed a maximum response time of 2 days to get back to the complainant. There is a wide range of complaints that come through every day.
To register grievances, and to ensure calls are not missed, the designated cell has employed technology in the form of a customised EPABX system, “Super Receptionist”, provided by a Gurgaon-based technology firm. The system allows for recording each call. This is stored in the cloud and may be retrieved by Utkarsh at any point.
The Grievance Redressal Cell utilises this functionality to the fullest. The recordings are transcribed and recorded in a register manually. This now becomes a database of issues that customers have complained about. The cell thereafter categorises the data based on severity of the complaint. The most severe issues are highlighted to the senior management periodically. The management therefore becomes cognizant of issues plaguing their target clientele and the information therefore feeds into all strategic decisions that the management takes.
Additionally, there is a separate three-member Grievance Redressal Committee, comprising of the CFO, Head-HR and Head-Internal Audit, that meets every month to review the complaints observed in the period and to ensure that there are no complaints that have gone unanswered or to which a satisfactory solution has not been provided. The Grievance Redressal Cell, in effect, therefore reports to the Grievance Redressal Committee. The Committee in turn reports to the Executive Committee, comprising of heads of all departments and chaired by the CEO. The Executive Committee also meets on a monthly basis, during which the minutes of the meeting of the Grievance Redressal Committee are tabled.
It was interesting and most heartening to see the level of detail that MFIs are going to, so as to ensure that the products they offer to clients and the processes through which they do so, have client buy-in. In the case of Utkarsh, while placing a complaint box at the branch was the obvious first step for registering anonymous complaints, the MFI operates in geographies with very low female literacy levels, making the use of such boxes difficult. The management has effectively tapped the spread of telephony in rural India to overcome this challenge.