The financial sector in India has seen tremendous growth due to the introduction of microfinance software. Automated loan software is strengthening the economic landscape of developing countries like India. Thousands of people in rural and urban areas depend on credit institutions like banks, NBFCs and MFIs for loans and other financial assistance. More and more people want to access finance and managing these loan applications can be a daunting task for banks and NBFCs.
Microfinance software helps the lending firms to manage the applications smoothly without any errors or uncertainty.
In this blog post, we will talk about A Complete Guide to Microfinance Software for MFIs, NBFC-MFIs & Rural Lending Institutions, and will discuss the benefits, uses, and more to have a complete idea about the Microfinance software.
Key facts about the Microfinance Software
- Choosing microfinance software can reduce the loan processing time by up to 80%. Financial IT.
- Jaguar Software India, an AI-based microloan software, can reduce decision-making time by 20–60% and lower fraud risk through predictive models.
- Yellow Software notes that microfinance software “reduces operational costs with paperless digital processes.
What exactly is Microfinance Software?
Microfinance software is a software that is used in the financial industry to manage operations digitally and smoothly, furthermore, it is used by lending institutions like banks, NBFCs, and MFIs to lend loans to borrowers and manage their loan lifecycle. The whole process is managed digitally and automatically, and no involvement of paper is required.
Key Features of Microfinance Software
The main key features of Microfinance software are
1) Paperless Onboarding
There is no involvement of the paper. All the customers’ details can be taken digitally through the applications. You can capture personal details, KYC, signature, documents, and more. This ensures the aster onboarding process.
2) Smart Loan Intake
The full information and background check are done through the microfinance software. The system automatically handles everything from loan requests to approvals and disbursements, reducing errors and speeding up the loan process.
3) Digital KYC & e-KYC
The system completes KYC digitally by verifying Aadhaar, PAN, and face detection documents in no time. This is faster and more secure, and builds trust with the customer.
4) Loan Management Systems
The system automatically calculates interest rates, schedules installments, sends EMI reminders, lets customers check their applications, and helps monitor NPAs. This helps the lenders and NBFCs to maintain a healthy loan process without any issues.
5) Cashless Collection from the Borrowers
Lending institutions can take the cashless money from the borrowers; moreover, it allows the UPI and QR payments, receipts, and more. It makes it easy for the lending firms to collect money without the burden of cash and managing a large amount.
6) Risk and Compliance Monitoring
Microfinance software includes credit checks, repayment behavior analysis, a PAR dashboard, and RBI-compliant reporting, helping institutions maintain operational discipline.
We have mentioned a few of the many features of the microfinance software that help the lending institutions and customers to easily manage the application, have complete tracking of their loans, and have a complete understanding of what they are using.
Benefits of using a Microfinance Software for MFIs, NBFCs-MFIs, and rural lenders.
Key benefits are as follows
| Benefits for the MFIs, NBFCs, and other lending firms | Explanation |
| Fast Loan Processing | Loans are approved in minutes rather than in days. This improves customer satisfaction and helps lending firms grow. |
| Error reduction | Microfinance software automates processes and eliminates errors in calculations, documentation, and data entry. It reduces fraud and manual errors. |
| Effectively managed portfolio | Loan applications are monitored automatically. This helps to detect the irregular payments, risky borrowers, and NPAs. |
| Transparency | From loan approval to disbursement, everything is transparent; moreover, trust is built between lender and borrower. |
| Operational cost | The software reduces operational costs by removing the need for papers, field visits, overhiring, and maintaining physical records. |
| Compliance with RBI Guidelines | Automatic monitoring makes it certain that regulators’ standards are observed by the institutions: RBI regulations, NPA norms, and KYC/AML standards. |
| Scalability | You can manage as many applications as you need to manage. You do not require any physical workforce. |
| Analytics | It provides business insights that improve the decision-making for the lending firms. |
Why is there a need for microfinance software for the MFIs, NBFC-MFIs?
Traditional lending processes require multiple steps that depend on human involvement. In the traditional processes, you perform manual data entry, cash-based collections, physical verifications, and decision-making. These methods are not only very slow but also prone to making mistakes, particularly in the case of institutions that serve large numbers of clients.
On the other hand, microfinance software takes away these challenges of manual intervention by humans. It helps by providing.
- Speedy processing
- Greater accuracy
- Improved risk control
- Data management in one place
- Complete digital visibility
It makes it easy to scale smoothly as your loan portfolio grows from a few hundred to even a few thousand clients.
Quote: Cost-Saving Impact of Microfinance Software
Digital microfinance systems can cut operational costs by up to 50% and reduce collection expenses by nearly 80%, making lending faster and more efficient.
In conclusion
Microfinance software has become an essential part of the financial industry. To expand the operations and provide faster loan approvals, disbursal, more MFIs, NBFCs are adopting the microfinance software, furthermore, it has immensely helped the lenders and borrowers and is now an integral part of the financial ecosystem.
If you are looking to get the microfinance software, you can get it from Jaguar Software India. The company provides microfinance software solutions to lending firms and has served the industry for many years, helping lenders get customized software for their business needs.
To get in touch with Jagaur Software India, we have mentioned the details below, moreover, you can feel free to contact the company and get the right information from our experts.
Contact details
Company Name – Jaguar Software India
Phone No – +919666107000
Address – 18-19, Rajinder Nagar, Police Lines Road, Jalandhar, India
Email – info@jaguarsoftwareindia.com
Website – https://jaguarsoftwareindia.com/
Frequently asked questions
Which company provides the Microfinance software in India?
Jaguar Software India provides the highest quality, customized microfinance software solutions to lenders like NBFCs, MFIs, Banks, and fintech institutions.
How much will it cost to get the Mcrofinance software from Jaguar Software India?
Many factors influence the cost of microfinance software. Our experts at Jaguar Software India understand your business needs and then guide you accordingly about the cost of the microfinance software. Our prices are reasonable, and our quality is unmatched.
What is the difference between MFIs and NBFCs?
MFIs focus mainly on the rural population, and NBFCs focus on both rural and urban. Jaguar Software India provides the microfinance software for both institutions.
Who uses Microfinance software?
Microfinance institutions, banks, NBFCs, lending firms, NGOs, personal loan providers, and others use it.
Which company provides the best Microfinance software in India?
The company that provides the best Microfinance software in india is Jaguar Software India.
How can Microfinance software help rural lending firms?
The software increases transparency, speeds up approvals, supports offline and remote access, prevents fraud, and enables cashless transactions, furthermore, making lending easier in far-off villages.
Will Microfinance institutions be able to scale faster with the Microfinance software?
Yes, the system easily manages more and more applications. You do not require additional staff to manage the application.
Can you integrate the microfinance software with the payment gateways?
You can integrate it with payment gateways, banks, NBFCs, and other software essential to the loan management cycle.
What is the highest benefit of using microfinance software for the NBCs, MFIs?
It will be faster onboarding of the borrowers, quicker loan approvals, transparency, and easier tracking and monitoring of the applications.
Can small or medium-sized lending firms use the Microfinance software?
Yes, medium and small-sized firms or MFIs can use the microfinance software to run their operations. Jaguar Software India provides the Microfinance software for small, medium, and larg firms and NBFCs.
