The microfinance sector has been highly successful in serving micro-entrepreneurs, but a significant gap exists for small and medium-sized enterprises (SMEs) that have outgrown small loans and require more sophisticated financial products. These growing businesses are often too large for traditional microfinance but still too small and informal for commercial banks, a phenomenon known as the "missing middle." Without access to appropriate financing, these SMEs—which are a critical driver of job creation and economic growth—are unable to scale, innovate, and contribute to their full potential. Bridging this gap requires a specialized approach, one that builds on the client relationship and operational efficiency of microfinance while adopting the risk management and product sophistication of commercial banking.

This course is designed to equip microfinance professionals with the strategic and operational skills needed to effectively serve the SME segment. You will learn how to transition clients from micro to SME loans, design tailored financial products, and develop a robust risk assessment framework for growing businesses. By exploring the business models, technologies, and non-financial services that support SMEs, you will be prepared to unlock new market opportunities and position your institution as a key partner in the economic development of your clients and communities.

Duration: 5 days

Target Audience:

• Microfinance institution (MFI) managers and executives
• SME lending and credit analysts
• Product managers for financial services
• Business development professionals
• Risk management specialists
• Professionals in charge of field operations
• Financial inclusion practitioners
• Social entrepreneurs and startup founders
• Regulatory and policy advisors

Objectives:

• Master the core concepts of SME-linkage microfinance.
• Understand the unique financial needs of SMEs and the "missing middle" challenge.
• Learn how to transition clients from micro-loans to SME-level products.
• Grasp the complexities of risk assessment for growing businesses.
• Design and implement a portfolio of tailored SME financial products.
• Explore the role of non-financial services in supporting SME growth.
• Understand the technological and operational requirements for SME lending.
• Learn to build a strong relationship with SME clients.
• Analyze successful case studies of MFIs serving the SME segment.
• Develop a strategic roadmap for launching or scaling an SME lending program.

Module 1: The SME-Linkage Rationale

• The "missing middle" and its economic importance
• The difference between a micro-business and an SME
• The challenges MFIs face in serving SMEs
• The strategic business case for SME-linkage
• Case studies of MFIs that have successfully transitioned

Module 2: Client Transition and Profiling

• The criteria for graduating a micro-client to an SME
• The process of identifying and assessing high-potential clients
• Understanding the growth trajectory of a small business
• The importance of a relationship-based approach
• The role of loan officers as business advisors

Module 3: Risk Assessment for SMEs

• The difference between cash flow and character-based lending
• Using financial statements and business plans for analysis
• The importance of site visits and client interviews
• Assessing business risk and market risk
• Tools for risk mitigation in the SME portfolio

Module 4: Designing SME Financial Products

• Loans for working capital, asset acquisition, and expansion
• Designing flexible loan terms and repayment schedules
• The role of collateral and collateral substitutes
• The importance of transparent and competitive pricing
• The potential for non-lending products for SMEs

Module 5: Non-Financial Services for SMEs

• The importance of business development services
• Providing skills training in accounting, marketing, and management
• The role of mentorship and networking opportunities
• Linking SMEs to value chains and markets
• The business case for offering non-financial services

Module 6: Operations and Technology

• The operational requirements for an SME lending department
• The role of a specialized team and loan officer
• Using technology for data analysis and credit scoring
• Automating a part of the loan application process
• Managing a high-value loan portfolio

Module 7: Partnerships and Ecosystems

• The importance of collaborating with banks and other financial institutions
• Partnering with business development service providers
• The role of government and policy support
• Building a network of trust and collaboration
• Leveraging partnerships for client referrals

Module 8: The SME Portfolio

• How to track and analyze the health of an SME portfolio
• Key performance indicators (KPIs) for SME lending
• Managing the risk of over-indebtedness
• Strategies for client retention and cross-selling
• The importance of a robust monitoring and evaluation system

Module 9: The Legal and Regulatory Environment

• Navigating the regulatory framework for SME lending
• The difference between microfinance and commercial banking regulations
• The role of credit bureaus and other data providers
• The importance of consumer protection for SMEs
• The role of policy advocacy

Module 10: The Future of SME-Linkage

• The convergence of fintech and SME finance
• The role of digital platforms and APIs
• The potential of open banking for SME lending
• The long-term impact on job creation and economic growth
• Emerging trends and innovations in the sector

Training Approach

This course will be delivered by our skilled trainers who have vast knowledge and experience as expert professionals in the fields. The course is taught in English and through a mix of theory, practical activities, group discussion and case studies. Course manuals and additional training materials will be provided to the participants upon completion of the training.

Tailor-Made Course

This course can also be tailor-made to meet organization requirement. For further inquiries, please contact us on: Email: info@skillsforafrica.org, training@skillsforafrica.org Tel: +254 702 249 449

Training Venue

The training will be held at our Skills for Africa Training Institute Training Centre. We also offer training for a group at requested location all over the world. The course fee covers the course tuition, training materials, two break refreshments, and buffet lunch.

Visa application, travel expenses, airport transfers, dinners, accommodation, insurance, and other personal expenses are catered by the participant

Certification

Participants will be issued with Skills for Africa Training Institute certificate upon completion of this course.

Airport Pickup and Accommodation

Airport pickup and accommodation is arranged upon request. For booking contact our Training Coordinator through Email: info@skillsforafrica.org, training@skillsforafrica.org Tel: +254 702 249 449

Terms of Payment: Unless otherwise agreed between the two parties’ payment of the course fee should be done 7 working days before commencement of the training.