Commercial Bank and MFI Linkages: Tools for Assisting MFIs in Partnering with Commercial Banks

A servicing arrangement is a complex transaction that can reflect multiple business terms and objectives. The purpose of this Guide is to highlight some of the most common negotiation and documentation issues that MFIs are likely to encounter when entering into a service agreement with a commercial bank. This Guide offers general guidance for MFIs that are preparing to negotiate service agreements with potential Partner Banks. It also includes a sample form of a term sheet for a service agreement, a checklist of questions for MFIs contemplating funding partnerships/servicing arrangements with commercial banks, and a discussion of why and how to engage legal counsel.