The Scenario of Microfinance in Latin America Against the International Financial Crisis
This article discusses the current situation and performance of the microfinance sector in Latin America in the backdrop of the international financial crisis. The article also describes the development of Latin America’s microfinance industry.
Latin America has excellent conditions for microfinance growth. Microfinance in the region is diverse despite the multiplicity of institutions. The current situation of the microfinance sector demonstrates that institutions should maintain or gain better participation in the financial market if they do not want to be replaced by other financial institutions. Credit promotion occupies a prominent position. The article recommends that countries in the region should:
- Reform rules that make the supply of financial services to the poor difficult or expensive;
- Formalize and concentrate government and private sector efforts based on development projects with viable and sustainable strategies for economic growth and poverty reduction;
- Strengthen their public policies in favor of MFIs and extend their economic base in the long term;
- Find more ways for the development of the microfinance sector and more systems and procedures to expand credit supply.