2008 Microscope on the Microfinance Business Environment in Latin America and the Caribbean

Analyzing the microfinance business environment

This report evaluates the strengths and weaknesses of the microfinance business environment in Latin America and the Caribbean (LAC).

The report presents an overview of the microfinance environment in 20 countries from the LAC. It states that:

  • Microfinance business environment improved in Colombia, Guatemala, Nicaragua, Peru, Argentina and Ecuador and worsened in Paraguay, Bolivia, Chile, Uruguay, and the Dominican Republic;
  • Regulatory environment for microfinance business changed in LAC countries;
  • Microfinance business environment is diverse in LAC countries;
  • Microfinance is expanding continuously in LAC region;
  • Country size and wealth are not associated with quality of microfinance environment;
  • Country scores are associated with level of microfinance penetration and demand in each country.

The report presents a scoring model that divides the assessment of the business environment into microfinance regulatory framework, investment climate and institutional development. It demonstrates that microfinance can thrive in countries with difficult general business conditions.

About this Publication

By Economist Intelligence Unit