Measuring the Impact of Microfinance: The Case of Financiera Calpia, El Salvador
This paper contributes to the debate on the impact of microfinance institutions (MFIs) through a case study of the clients of Financiera Calpia (FC), one of the most successful MFIs in Latin America. It seeks to answer the following questions:
- What is the specific socio-economic profile of rural borrowers of FC when compared to non-client rural households and urban clients of Calpia?
- How competitive is Calpia's credit technology in El Salvador?
- What has been the impact on the standard of living of clients?
The main findings of the empirical investigations are:
- Client profiles in rural and urban contexts differ sharply;
- There is significant correlation between the characteristics of the credit technology and the client profiles;
- Strategies adopted by clients for risk management differ in rural and urban areas;
- Self-employment in micro enterprises is more important for members of the upper quintiles of the income distribution;
- Credit technology is highly competitive;
- Repayment behavior differs between rural and urban clients; agricultural cycles cause much prolonged arrears in the rural environment.