HAWASSA UNIVERSITY, DAYE CAMPUS

DEPARTMENT OF AGRICULTURAL ECONOMICS

PRACTICAL ATTACHMENT ON OMO BANK

TITLE: INTERNSHIP REPORT ON OMO BANK

ATTACHMENT PERIOD: DECEMBER 22_FEBRUARY 1 OF 2016

PROGRAM: BACHELOR OF SCIENCE IN AGRICULTURAL ECONOMICS

PREPARED BY:

WONDU LEMMA.......................... 2536/13

Daye, Ethiopia
 ABSTRACT

The report contains Five parts, part one deal with introduction, includes
back ground of the organization, main function, vision, mission and core activity of
the institution. Part two deals with main programs in the organization, it includes
key function, duties and responsibilities, staff establishment of the department. Part
three deals with main activities of the practical attachment it includes main
objectives for practical attachment,significance of the attachment and SWOT
analysis of the company. The last part deals with conclusion and recommendation.

Generally, this practical attachment report shows my performance, what kinds

of activities performed during the time of practice, the practical attachment report
focus on apply theoretical study in to practical and evaluate self-performance, with
regarding to the mission, vision and values of the organization as well as evaluate
the strength, weakness, opportunity and threat of the branch, current problems with
solution.
 ACKNOWLEDGEMENT

First, I would like to thanks Almighty God who has a base and source of
knowledge and success in completion of this practical attachment. next I
would like to thanks Hawassa University Daye campus and department of
agricultural economics about to give me this opportunity and I would like
exception thanks for my advisor mr.Aklilu A. and a bank advisor Ato Daniel
,for accept my application and give to me there advise and life experience,
also I would like to thanks all employees for share their work experience to
my practical attachment. The branch's managers and all employees to make
a big effort to completion of my practical attachment.
 Chapter one: Introduction

1.1 Historical background of the organization right from its establishment.

Omo micro finance institution is established in 1997 registering with the

national bank of Ethiopia. Since its establishment the institution has been
providing saving and loan services to the low income societies in its
operational areas. During the last two decades, the institution has captured
the need of both social and financial success histories. At the very beginning it
starts with in limited pilot operational areas in four Those are,
It begins with 3.2 million of total capital and deposited net saving birr
26,654 .The total capital asset and deposited net savings rise between at the
mid of one decades reached at about 523 million , total asset 5 billion as of net
saving 2billion correspondingly. Daye omo microfinance established in

Daye omo microfinance,can get its sources of funds from government and non
government.Sidama regional state bureau of enterprise can subsidized its
funds.It can also get it's fund from NGO like RGOS,RUIFB'S.
 1.2. Main functions or core activities of the host organization
Providing services like loan,credit and saving to alleviate poverty's among poor
house holds

Motivating women to engage on saving by charging high interest rate than

men.i .e eight percent rate of interest

Giving fast services for customer-customer satisfaction

Working for giving loan in the form Omo regular fund and youth employment
fund by charging 10%and 20% respectively.

It target economically active poor women and men in both rural and urban
Decrease unemployment by provision of youth fund and Omo regular fund

1.3. Vision, mission statement and core values of the institution.

1.3.1 Mission of OMO micro finance

Every organization has own mission and purpose. As I have observed the
organization have well developed and organized mission .

The following are the mission of OMO BANK

Giving loan to individual, groups,and union of unemployed youth.

Empowerment of underserved individuals and communities by providing them
with access to financial services, resources, and opportunities that promote
economic stability, entrepreneurship, and social development.
Fostering financial inclusion, supporting small businesses, and improving the
livelihoods of our clients through tailored microfinance solutions.

provision of accessible, reliable, and innovative financial services to individuals,

businesses, and communities in order to promote financial inclusion, economic
empowerment, and sustainable development.

committed to building strong relationships with our customers, prioritizing their

needs and aspirations, and contributing positively to the communities.

1.3.2.Vision of the organization

To be a leading provider of financial services to underserved communities.

To empower individuals and small businesses through access to affordable

financial products.

To promote financial inclusion and economic development in the area

To build strong, lasting relationships with our clients based on trust and
transparency.

To continually innovate and adapt thier services to meet the evolving needs of
their clients.

To achieve sustainable growth and financial stability

1.3.3. Core Value of OMO Microfinance

Financial Inclusion: We believe that everyone, regardless of their background

or circumstances, deserves access to financial services and opportunities to
improve their lives.
 Empowerment: It committed to empowering individuals and communities
by providing them with the tools, resources, and support they need to achieve
their financial goals and aspirations.

Integrity: It operate with the highest level of integrity, transparency, and

ethical standards in all our interactions with clients, partners, and stakeholders.

Collaboration: It value collaboration and partnership with other organizations,

institutions, and stakeholders whether it is governmental or non governmental to
improve it's sources of fund and reach more underserved individuals and
communities.

prioritize the needs and interests of clients

Contributing to sustainable development, poverty alleviation, and economic

empowerment.

Honesty: It is honestly act as source of funds for unemployed section of

society
Fairness: fairly serving the unemployed class of society regardless of
gender, religion,race and the like
 Chapter Two

Host Attachment Department/Section in the Organization

2.1. Organizational structures of Omo microfinance

Ther are various departments with respect to this institution.Those are,General
manager, operational management,Human resources department, Auditing
department,Accountant department, customer relation officer,customer service
officer.

2.2. Key functions/ activities of the department.

General manager:

The highest governing body responsible for setting the overall strategic direction
and policies of OMO Microfinance.

It control the overall activities of other departments.

He approved different financial reports for institution.

Supervise the whole operations of the institution

Manage and control the work performances of the workers

Arrange meeting and discuss with workers

Conduct meeting within a month

Operational department:

Performing the daily activities of the institution

filling of different forms like payroll for employees and directly transfer to audit
department

financial department:

Manages the financial aspects of the organization, including budgeting, financial

reporting, and risk management.
Collecting amount of cash from client

Collecting amount of cash income and expenses of the institution

Human resource department:

Controlling all human activities at work place in the institution

Preparing the file of employees

It can also hold the control of employees,their attendance and writing of format
letter to Auditing department.

Audit department:

To check the amount of cash flows in the institution

To give financial activities like, collecting cash, giving cash,and checking the
amount of cash

Customers service officer: this team control the entry and exit of money.
responsible for ledger work.

customer relation officer: It serve for collecting un returned loan at reasonable

time going through kebele. They can replace operational manager for certain time
series.

IT Department: Manages the organization's information technology

infrastructure, including software systems, network security, and data
management.

Messengers

Guard and cleaner

2.2. Staff establishment of the department in terms of the number of employees
and their duties and responsibilities.

2.3. Detailed description of the assignment that the student was handing in the
department.

Chapter three

Evaluation of the attachment period

3.1. Description of the strength, weakness, threats and opportunities of the

organization.
3.1.1. Strength of the institution
1. Strong Social Impact: OMO Microfinance institution has a strong commitment
to financial inclusion and poverty alleviation, providing access to financial services
to underserved and marginalized populations.

2. Extensive Outreach: OMO Microfinance has a wide network of branches or field

offices, allowing it to reach clients in remote and rural areas where traditional
banks may not have a presence.

3. Robust Risk Management: OMO Microfinance has effective risk management

practices in place to mitigate credit, operational, and other risks associated with
its operations, ensuring the sustainability of its business model.

5. Experienced Leadership Team: OMO Microfinance has a team of experienced

leaders with expertise in microfinance, finance, and social impact, guiding the
organization towards its strategic goals.

6. Innovative Products and Services: OMO Microfinance continuously innovates its

products and services to adapt to changing market conditions and meet the
evolving needs of its clients.

7. Strong Partnerships: OMO Microfinance collaborates with local communities,

government agencies, NGOs, and other stakeholders to enhance its impact and
reach more clients in need of financial services.

8. Transparent and Ethical Practices: OMO Microfinance upholds high standards

of transparency, accountability, and ethical conduct in its operations, building
trust with clients and stakeholders.
9. Financial Sustainability: OMO Microfinance has a sound financial management
approach that ensures its long-term sustainability and ability to continue serving
clients in the future.

3.1.2. Weakness of the OMO microfinance institution

1. Limited Capacity: OMO Microfinance may have limited capacity in terms of

human resources, technology infrastructure, or funding, which could hinder its
ability to scale up operations and reach more clients.

2. Vulnerability to Economic Shocks: OMO Microfinance's clients, who are often

low-income individuals or small businesses, may be more vulnerable to economic
downturns, leading to higher default rates and financial instability for the
institution.

3. Regulatory Challenges: OMO Microfinance may face regulatory challenges or

compliance issues in the markets where it operates, which could impact its ability
to expand or introduce new products and services.

4. Competition: OMO Microfinance operates in a competitive market with other

microfinance institutions, banks, and fintech companies offering similar services,
which could pose a challenge in attracting and retaining clients.

5. Limited Product Diversification: OMO Microfinance's product portfolio may be

limited in terms of diversity, which could restrict its ability to meet the varied
financial needs of its clients and adapt to changing market demands.
6. High Operating Costs: OMO Microfinance may incur high operating costs
related to branch networks, staff salaries, technology investments, and risk
management practices, which could impact its profitability and sustainability.

7. Credit Risk: OMO Microfinance's lending activities expose it to credit risk, as

defaults or delinquencies by clients could affect its financial performance and
asset quality.

8. Limited Access to Funding: OMO Microfinance may face challenges in accessing

affordable funding sources, such as loans or grants, which could constrain its
ability to expand operations or offer competitive interest rates to clients.

9. External Factors: OMO Microfinance may be vulnerable to external factors such

as political instability, natural disasters, or regulatory changes, which could
disrupt its operations and financial stability.

3.1.3 Opportunity of OMO microfinance institution

1. Partnerships: OMO Microfinance can explore partnerships with other financial

institutions, fintech companies, NGOs, or government agencies to expand its
reach, share resources, and offer complementary services to clients.

2. Product Diversification: OMO Microfinance can diversify its product portfolio to

include savings accounts, insurance products, financial education programs, or
value-added services, catering to the diverse needs of its clients and increasing
revenue streams.

3. Capacity Building: OMO Microfinance can invest in training and development

programs for its staff, improving their skills and knowledge in areas such as
customer service, risk management, and financial literacy, enhancing overall
operational efficiency.
4. Geographic Expansion: OMO Microfinance has the opportunity to expand its
presence into new regions or countries with underserved populations, leveraging
its existing expertise and network to establish a stronger foothold in new markets.

5. Social Impact: OMO Microfinance can focus on measuring and communicating

its social impact, demonstrating how its services contribute to poverty alleviation,
job creation, and economic empowerment in the communities it serves, attracting
socially conscious investors and donors.

6. Customer Engagement: OMO Microfinance can enhance its customer

engagement strategies through personalized communication, feedback
mechanisms, and client-centric product design, building trust and loyalty among
its client base.

7. Innovation: OMO Microfinance can encourage a culture of innovation within

the organization, fostering creativity and entrepreneurship among its staff to
develop new solutions, processes, or business models that drive growth and
sustainability.

3.1.4.Threats of the institution

1. Competition: OMO Microfinance faces competition from traditional banks,

other microfinance institutions, fintech companies, and informal money lenders,
which may offer similar financial products and services to the same target market,
leading to market saturation and pricing pressures.
2. Economic Instability: OMO Microfinance is vulnerable to economic downturns,
inflation, currency fluctuations, and other macroeconomic factors that may affect
the financial stability of its clients, leading to higher default rates, reduced
demand for loans, and increased credit risk.

3. Regulatory Changes: OMO Microfinance is subject to regulatory changes,

licensing requirements, compliance standards, and reporting obligations imposed
by government authorities, which may increase operational costs, limit flexibility
in product offerings, or lead to legal disputes if not properly managed.

4. Credit Risk: OMO Microfinance faces credit risk from loan defaults,
delinquencies, and non-performing assets, especially in cases where clients face
financial difficulties or external shocks such as natural disasters or health
emergencies, impacting the institution's profitability and liquidity.

5. Technological Disruption: OMO Microfinance may face challenges in adopting

and integrating new technologies, such as cybersecurity threats, data privacy
concerns, or disruptions in digital payment systems, which could compromise the
security of client information and transactions.

6. Funding Constraints: OMO Microfinance relies on external funding sources such

as grants, loans, or deposits to finance its operations and lending activities, facing
risks of funding shortages, interest rate fluctuations, or liquidity constraints that
may impact its ability to meet client demands or expand its services.
7. External Shocks: OMO Microfinance is vulnerable to external shocks such as
political instability, regulatory changes, environmental disasters, or public health
crises like pandemics, which may disrupt its operations, reduce client demand for
financial services, or impact the overall economic environment in which it
operates.

3.2. Description of the benefits I gained from the attachment in terms of practical
knowledge/ Significance of Practical Attachment

Since this practical attachment is the connection between theory in class and real
world it has significant. Some of the significance of this practical attachment;
➢ Help to know and compare the relationship between the theory and real world

➢ To increase my confidence on future work

➢ To identify the problem in the company for necessary solution

➢ Help to apply the theory in class for future expected activities

➢ Help me to how to identify and find solution for problem

➢ Help to teach others the acceptability of theory in class

➢ Increase my confidence for research and etc.…

3.3. Experience gained

When I was done this practical attachment I have got an experience and
knowledge which will help me for my future work environment. Those are,

How the work of each institution has planned, monitored and controlled over
time

I also acquired the work ethics in working environment

How to communicate and solve problems if any among co-worker

Grasped practical knowledge

How to organize and arrange different information from different sources

3.4. Challenges encountered by the student during the attachment period.

Major problems faced me during the attachment

❖ At the beginning time they didn’t give me full freedom to do activities

independently.

❖ Shortage of some extra or additional working materials like chair and

computers for trainers.
❖ Some employees are not interested for sharing their experience.

❖ Their working computers have a secret password.

3.5. How the challenges were solved.

Suggested solution and way forward for Attachment

The problem mentioned above are solved by:-

❖ I was try to adapt new environment and working condition gradually by

studing behavior of department member and sharing experience among them.

❖ The organization should have to buy additional materials like chair and
computers that help for training

❖ The organization should give the opportunity for students to participate in a

given activities freely in order to improve their knowledge and producing self-
confident professionals.

❖ The organization should have to prepare other computer for training in

addition to the working computer.19
Chapter four: Conclusion & Recommendation

First of all, this kind of course ( practical attachment) will give students the
experience they need in the world of work. However, while doing this course,
students need the help of staff and teachers to enable them to do their work
properly and get enough experience.
For example:-
In the university
When students go to school, school administrations should know in advance
when students will come and be prepared and wait.
When students enter and work in offices, it is necessary to allocate enough
time for students to stay in the office so that students can gain sufficient
understanding and knowledge about the office they work in.
 In the same way, when students are working on the facilities, an appropriate
amount of budget will be allocated based on the current situation of the
country.

In the company
In order to make the organization more accessible, by supplementing the
missing man power, providing the necessary resources, material and
extension services to the community at the appropriate time and place.
When students are working in the office, the staff of the office, from the
general manager to the messenger& cleaner, should cooperate as much as
possible so that the students can get the information they need.
Staff under the offices should be at their workplace properly during working
hours and help individuals and organizations that cameos to the institution in
order to get information.
5. References

Some oral information from employees

Information from written documents of organization

Direct information from the supervisor of the organization

From employees of organization

Some from daily activities