An Open Source platform for Micro Finance

Pierre PEZZIARDI, PresidentVincent BIOT, Chief Operating Officer

History

2005 : An IT Consulting Company and an NGO meet

2006-2008 : OCTOPUS incubated in OCTOCreation of the « Linux de la Micro Finance »

2009 : Creation of Octopus Micro Finance as a private company

Market

• 3 Billion persons in the world with no access to financial services

• 10 000 Micro Finance Institutions (MFI), +30% per year• 90% of them use a rudimentary Management Information System

that impedes their efficiency : manual, unsecured, obsolete, not flexible

• Failure of classical business models of IT in this context• Packaged software, license fees, fool’s bargains eluding risks and change,

and technical complexity requiring specialists

What is the problem ?

• Though small organizations, MFIs need to gather many expertises• Customer management, delinquency management• Financial products marketing and management• Profitability and Social Impact management• Risk management• Accounting and Regulatory Compliance• … and IT - a mirror of all those expertises - not managed by 90% of them

• Some succeed, some don’t, or won’t• High risks situations : fast growth, credit risk, operational risks,

operational costs increase, unknown social impact, low access to donors• Connecting micro-finance expertises through IT is a valuable help

• That MFIs need now!

Our goal

• Increase financial services affordability for the poorest

• By creating autonomy among Octopus users

• With a world wide community of practitioners in Agile and Lean techniques

• More than Open Source product, a continuous improvement process, connecting MFIs and IT specialists

costs

Why Open Source ?

value

Procurement-led : the user is a customer(1960-2000)

t

value

costs

Adoption-led : the user becomes a customer(2000+)

t

Test alone Deploy with an expert

Innovate with another expert

RFP, MIS in-a-box

maintenance, new licenses

Benefits

• Freedom• MFIs buy what they need, when they need it, and from whom they want

• Community• It’s easy to step into the community and contribute : one translation, one

paragraph in the documentation, one new feature, one piece of code, one end-user support …

• Continuous Improvement• The software improves with its community• Octopus specialists are also skilled in “soft techniques” : focus on the

value of IT (lean management) and change management

Our positioning

Tiers 1(banks)

Tiers 2 : profitable MFIs

Tiers 3 : small MFIs20% ofourrevenues

80% of oursocial impact

80% of our revenuesand energy

20% of our

social impact

Business model

SaaSServices & Consulting

A hosted service that totally manages MFIs’ MIS

Customers, loans, savings, accounting, reporting

Training

Setup

Coaching

Specific developments

Funding : MFI

(fee as a % of revenues if profitable)

Funding : MFI , Institutional

Social impact : some of our users

Oxus (Afghanistan) MUNCSMED (Fiji) African Gate Support (Ghana) Informatici Senza Frontiere (Madagascar)

AIRDIE (France) Oxus(Kyrgyzstan)

Bardar (Kyrgyzstan) Pik and Cie (Kyrgyzstan) Sambahav (India) MSS (India) IIMC (India)

Oxus (Tajikistan) ABM Credit (Kazakhzstan) Baï jurt (Kyrgyzstan) GFI (Cameroun) …

WWW.OCTOPUSNETWORK.ORG

© Octopus Microfinance 2009