Simone Group

Micro Loan Program

In this era of low interest rates, financial institutions may find that they are struggling with an under-performing loan book.

Because the profitability of the loan book is based on interest rate spread – and that margin has been eroded – the pressure is on to find new sources of income.

Responses to this situation can include:

  1. Intensify loan marketing and sales efforts – mindful that the competition will be doing the same
  2. Look to syndicated deals, to take a slice of larger deals already happening in the market – mindful that risk profile, account complexity, competitive influences, and closure cycles all increase
  3. Look for greater returns from the non-loan side of the business – things like insurance, services, investments, and other income.
  4. Cultivate a new loan product-market.


Building a micro-loan portfolio sets an FI apart in competitive markets, by closing the revenue gap, and bringing new, low-risk businesses into the system.


Here’s how it works:

Here’s the modelling:

Is your loan book is down?

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