(A partnership between UKaid Sakchyam and Laxmi Laghubitta Bittiya Sanstha Ltd )


The Microfinance sector in Nepal is striving towards digitization of operations. More and more institutions are switching to the digital platform to ensure efficient organizational functioning and better services to the clients. Availability of digital banking opens doors for a wide range of products and convenient modes of service. Similarly, Laxmi Laghubitta Bittiya Sanstha Limited, a microfinance with 67 branches in 52 districts has been aiming to digitize its operation. However, the Core Banking System (CBS) being used by Laxmi Laghubitta had its limitations, especially in third-party solutions such an ATM, POS, mobile banking etc. Replacing the current system with a CBS capable of digital banking facilities seemed the best way forward for the institution.


The major obstacle that made the move towards digital banking difficult for Laxmi Laghubitta is that the current CBS doesn’t support alternative delivery channels. So, the organization was not able to offer services such as mobile/tablet banking, paperless record keeping and SMS alerts among others. The expansion of the branches also called for an upgrade of the system that could support the additional workload. There were major shortcomings in reporting system as there were inconsistencies among the different reports generated by the software. Another issue was the inability of the CBS in use to support other auxiliary software needed for efficient MIS. Due to these inadequacies of the CBS, the organization even had to limit its plan for new product launches and implementation of additional services.

Sakchyam Intervention

The past partnerships of Sakchyam with other MFIs have proven that the adoption of technology helps micro finances achieve organizational efficiency and expand its outreach in a more self-sustainable manner. Under this partnership with Sakchyam, Laxmi Laghubitta will transfer their services and operations to a digital platform with the help of an advanced CBS. After the integration of the new software system, Laxmi Laghubitta will be switching to digital devices for services such as field operation for loan and saving collection and withdrawal, customer registration, loan application process etc. Tablet banking will be introduced in phases; in the first phase, it will be introduced in 10 branches belonging to different geographical areas and transaction volumes.

Likely Impact

The integration of this CBS will cut down the service delivery cost and time for Laxmi Laghubitta and will in turn help augment the efficiency and productivity of its staff. Digitization of the operation will also save the customers’ time and money in availing the services. More than 80,000 Customers of will benefit from new and improved service.

Other impacts:

— The robust CBS will enhance avenues for added services through convenient delivery channels offering a greater value proposition to the clients.

— The digitisation of clients’ data will facilitate in better design and implementation of targeted products and services in the future.