Grameen Foundation

Summary The objective of this project is to assess and diagnose Contactar’s current situation and needs in terms of Risk Management and implement a plan for establishing an integral system of risk management, which will be followed by a series of volunteer projects for actual implementation. The volunteer will need to have proficiency in Spanish language and a comprehensive knowledge and experience in risk management and its areas: loan risk, operational risk, market risk, laundering risk, environmental risk, etc. Background Contactar is a microfinance institution that serves urban and especially rural areas, through both individual and group microfinance methodologies (solidarity groups, associations and community savings and loans). In addition to the loans, Contactar provides micro-insurance, financial education, and health promotion in the community. Contactar's mission is “to give financial access to urban and especially rural micro entrepreneurs and farmers, contributing to reduce poverty and improve their living conditions”. Since 2007, Contactar has grown by 40% and increased its coverage to 22 branches in two departments of Colombia (Nariño and Putumayo), which are mainly rural. It currently has a work force of 134 collaborators. The portfolio has grown by 35% and the number of clients by 57% represented mainly by micro-companies and small producers with low incomes. As of December 2010, Contactar’s portfolio amounted over $26 million reaching 31.840 beneficiaries; for 2011, the portfolio is expected to grow by 60% and the number of clients by 61%. Challenge Currently, Contactar follows informal procedures to manage and mitigate risks, which are neither systematized nor documented. Additionally, not all risks are taken into consideration. Due to its increasing growth and outreach, it has become crucial to implement an integral system of risk management within Contactar. The first step for this implementation will be a needs assessment. Contactar has identified several risks that need to be explored. However, it will be highly beneficial to bring in a professional in risk management to help Contactar make an assessment in order to obtain a more comprehensive understanding of the needs in terms of establishing a comprehensive risk management unit. So far, risk management activities have been housed under the Internal Control Area. After the completion of this project, Contactar will implement a Risk Management Area and assign a Risk Management Coordinator to work closely with the volunteers on the follow-on projects. Project Description and Objectives The volunteer will make an assessment and diagnosis of the current risks, how they are being mitigated and identify the next steps to implement an integral risk management system. The volunteer will be expected to: • Complete all pre-readings provided by the risk management coordinator; • Visit Contactar offices in order to meet and interview with Contactar Executive Team; • Get an understanding of how Contactar currently mitigates risks; • Develop a comprehensive plan for next steps to implement an integral system of risk management. Volunteer Deliverables and Timeline Deliverables: • Report containing the assessment, analysis, identification of needs and an action plan in terms of risk management; • Development of activities with a timeline for the implementation of a system of risk management. • Presentation of the report to Contactar’s senior management. Timeline: • Deliverables have to be submitted by the end of the 4 weeks, detailed below. Volunteer Requirements Contactar seeks one (1) volunteer with strong knowledge and experience in integral risk management. The volunteer must be fluent in Spanish and English.