MSC (MicroSave Consulting) is a boutique consulting firm which “pushes the world towards meaningful financial, social, and economic inclusion.” We spoke to Nairobi-based Associate Partner Anup Singh about the company’s remarkable journey from start-up to global operation.
MiN: MSC recently celebrated its 20th birthday - how has the organisation evolved in that time?
Anup: When we started in 1998, microfinance was almost exclusively about micro-credit, but we realised that without micro-savings, it is a one-legged race for the poor to benefit from financial inclusion. Our proposition was very simple: if you listen to the market, you will grow by responding to people’s real needs.
In 2006 we moved to India and expanded into micro-housing, microinsurance, energy and environment, and water and sanitation. Since 2013 we have focused on digital financial and social inclusion programmes including rural employment, pensions, food, fertiliser and fuel subsidies. Now we’re rolling out these programmes in Indonesia and sub-Saharan Africa. We have recently rebranded to reflect our evolution from financial inclusion to social, economic and financial inclusion.
MiN: What does the future hold?
Anup: Our work focuses on social, economic and financial inclusion to enable low- and moderate-income people access to high-quality, affordable, customer-centric financial services and other support they need. For the next five years, our focus will be on enabling access to digital identity, bulk social payments and new payment systems, linking financial services to people’s real economic, health, environment, education and agriculture needs, bridging the digital divide, and creating inclusive programmes for marginalised groups such as women, youth, refugees and the uneducated.
We have always worked with low- and moderate-income people. It’s clear that the future is digital, so we’re focusing on creating the right blend of interventions to enable social, financial and economic inclusion of such segments.
MiN: How does MSC operate?
Anup: MSC provides technical assistance, research and training consultancy. We have 11 offices around the world with 190 staff - representing 40 different nationalities - running projects in more 50 developing countries in Africa and Asia. We always keep an eye out for opportunities to use the digital ecosystem to address the needs of the mass market and the low-income market.
MiN: How does MSC support inclusive insurance?
Anup: We bring the clients’ voices to the table. We work with a large number of insurers to scale up and design their existing microinsurance products and services - not just credit life but health and weather-based index insurance. For example, we helped an insurance partner in the Philippines design insurance for climate resilient agriculture.
We undertake microinsurance landscaping studies, looking at business models and distribution channels, and we come up with insights and recommendations. We ask: what are the current products, services and processes? What are the bottlenecks? What do people really want? What are the gaps and the risks? How could distribution channels be improved? One example: following our recommendations a microinsurer in East Africa turned a product which was losing US$70-80k a year into one which was making a profit of US$110-130k the next year.
MiN: Last year, you participated in a panel session on financing constraints organised by the MiN during European Microfinance Week. What did you learn?
Anup: We tend to think that financing is the constraint, but it isn’t - the binding constraint is really keeping the clients at the centre of design and getting the right distribution model.
There is a clear business case for inclusive insurance but how do we leverage technology to reach scale? Also, internal buy-in is really important because inclusive insurance is not like any other regular insurance. Management and board must be patient in order to capitalise on the full potential.
MiN: MSC has been a MiN member for a while, but you yourself are new to the Network. What are your impressions so far?
Anup: It’s very important for me to be part of this special inclusive insurance community and it’s really exciting to exchange ideas, share projects, access the latest reports and speak at events.
I think it’s a great opportunity for proactive cooperation with each other: reviewing concept notes, providing feedback on reports, learning and sharing more. Allowing people to access each other’s networks and constructively critiquing each other’s work. Together we can find the right synergies to create the right kind of solutions for the people who need it most.
MiN: How do you assess the current inclusive insurance market?
Anup: We have to move away from subsidies to financial sustainability. For example in India, there is a massive state scheme to provide bank accounts for the first time to around 500 million people. The government invited insurers to provide very low cost accessible insurance to go with the accounts and around 200 million people have taken it up. It is very low cost but not subsidised. That’s the sort of scale we want. We also need more investment in tech and data collection and analytics. If we have the right data we can create the right products. But regulators also need to be more up to speed on technology.
MiN: What have you learnt in your time with MSC?
Anup: Firstly, understanding the client is key to creating the right products, processes and channels, which in turn helps you scale up. Secondly, digital technology can create better, more efficient and more profitable businesses - but it must be used responsibly. Finally, it’s essential to keep tabs on the evolution and progress of the market and technology.