Tanzania Association of Micro finance Limited (TAMFI) organized a three days risk management training for micro finance institutions.
The training started yesterday the 15th of June, 2016 and will come to close on Friday 17th June, 2016.
Yesterday while opening the training, TAMFI CEO Winnie Terry said that it’s their expectations that the trainees will get the right skills and knowledge on risk management for the better future of micro finance industry and local economies.
Facilitator Dr Delphine D. Magere of Bank of Tanzania (BoT) said the objectives of the training were to help understand importance and value of Risk Management to Micro finance Institutions (MFIs), Help senior managers & directors of MFIs design a comprehensive approach to Risk Management, Describe key risks MFIs face and a comprehensive approach for managing them and guide MFIs on best practices in effective Risk Management.
She broadly took the trainees through risk management topic helping them identify six specific guidelines for the following major risks in the micro finance institutes.
- Credit risk
- Liquidity risk
- Market risk
- Operational risk
- Strategic risk
- Compliance risk
She also allowed the trainees to freely interact by giving a group assignment. Each group contained 5-6 participants and was supposed to present their answer.
Bank of Tanzania facilitator Peter J Mmari explaining about Operational type of risk in MFI’s said that people in institutions bring about fraud, employee theft, insider deals and robbery due to lack of knowledge ,adequate skills, training and development. He further defined it as risk of loss resulting from failed people, internal processes and systems.
The training is ongoing and its TAMFI’s hope that it will bring a positive impact on the MFI’s.
Risk is a situation involving exposure to the chance of loss, probability or a threat of damage or any other negative occurrence that is caused by either external or internal vulnerability. The probability that an actual return on investment will be lower, or the possibility of an adverse event occurring and its potential for negative implications to Micro finance Institutions (MFIs).