Experiences of Microfinance Institutions Serving Very Small to Small Enterprises in Latin America

Very small enterprises (VSEs) in Latin America and the Caribbean (LAC) represent a broad and heterogeneous segment, often underserved by formal financial institutions. They are generally informal and often family businesses. The financial needs of these enterprises are typically overlooked by “downscaling” banks, which find larger and often more formal small and medium enterprises (SMEs) to be a more natural market for their products and services. Microfinance Institutions (MFIs) are starting to move upmarket to serve SMEs, and in particular, VSEs within this segment. However, they use varying definitions, methodologies and products to do so and to date there has been little research or documentation of their experiences. This report highlights the results of a recent study of the existing practices in Latin America of MFIs serving VSEs, where VSEs are considered to be those businesses with financing needs of between US$7,000 and US$30,000. It is a starting point for an institution considering entering the segment, or for one that finds itself having grown into the segment “organically” but with a view to strengthen its position. It includes several checklists for MFIs interested in expanding upmarket into the VSE space, as well as more detailed discussions and examples of the most relevant points.

Bibliographic Details

Main Author:	International Finance Corporation
Format:	Report biblioteca
Language:	English en_US
Published:	Washington, DC 2014-07
Subjects:	ACCESS TO BANK, ACCESS TO BANK LOANS, ACCESS TO CREDIT, ACCESS TO CREDIT BUREAU, ACCESS TO DEBT FINANCING, ACCESS TO FINANCE, ACCESS TO FINANCIAL SERVICES, ACCESS TO FINANCING, ACCESS TO LOANS, ACCESS TO SERVICES, ACCOUNTABILITY, ACQUISITION COSTS, AFFILIATES, ALTERNATIVE FUNDING, ASSET BASE, ASSET DIVERSIFICATION, ATM NETWORK, AUTONOMY, BANK ALTERNATIVES, BANK COMPETITION, BANK GUARANTEES, BANKING MARKET, BANKING SYSTEMS, BANKS, BORROWING, BRANCH, BRANCHES, BUSINESS ACTIVITIES, BUSINESS CREDIT, BUSINESS LOAN, BUSINESS SEGMENT, BUSINESS STRATEGY, BUSINESS UNIT, CAPITAL ALLOCATIONS, CAPITAL LOANS, CASH FLOW, CASH FLOW ANALYSIS, CASH FLOWS, CDS, CHAMBERS OF COMMERCE, CHECKS, COLLATERAL, COLLATERAL REQUIREMENTS, COMPANY, COMPETITIVE MARKETS, CORPORATION, CREDIT ACCESS, CREDIT ANALYSIS, CREDIT BANKS, CREDIT BUREAU, CREDIT BUREAUS, CREDIT CARDS, CREDIT GAP, CREDIT HISTORY, CREDIT LINES, CREDIT NEEDS, CREDIT POLICIES, CREDIT PRODUCT, CREDIT PRODUCTS, CREDIT RISK, CREDIT RISK MANAGEMENT, CREDIT SCORING, CS, CURRENT ACCOUNTS, CUSTOMER PROFITABILITY, CUSTOMER SATISFACTION, CUSTOMER SERVICE, DEBIT CARDS, DEBT, DEPOSIT, DEPOSIT ACCOUNTS, DEPOSIT PRODUCT, DEPOSIT SERVICES, DEPOSIT TAKING INSTITUTIONS, DEPOSITS, DEVELOPING COUNTRIES, DISBURSEMENT, DISBURSEMENTS, DIVERSIFICATION, DIVERSIFIED PORTFOLIO, ECONOMIC GROWTH, EMERGING MARKETS, EMPLOYERS, EMPLOYMENT, ENTREPRENEURSHIP, EQUIPMENT, EXISTING BUSINESS, EXPANSION, FACTORING, FAMILIES, FAMILY BUSINESSES, FINANCIAL COSTS, FINANCIAL CRISIS, FINANCIAL INFORMATION, FINANCIAL INSTITUTION, FINANCIAL MARKETS, FINANCIAL NEEDS, FINANCIAL PRODUCT, FINANCIAL PRODUCTS, FINANCIAL SERVICES, FINANCIAL STATEMENTS, FINANCIAL SYSTEM, FINANCING COSTS, FINANCING NEEDS, FIRM SIZE, FIRMS, FIXED ASSET, FIXED INVESTMENT, FORMAL FINANCIAL INSTITUTIONS, FORMAL FINANCIAL SECTOR, FORMAL INDEBTEDNESS, FUNDING SOURCES, GOOD CREDIT, GROUP LENDING, GUARANTEE FUNDS, GUARANTEE REQUIREMENTS, HUMAN RESOURCES, INFORMAL LOANS, INFORMATION REQUIREMENTS, INSTITUTIONAL CAPACITY, INSTITUTIONAL LOANS, INSURANCE, INTEREST RATE, INTEREST RATE CAPS, INTEREST RATES, INTEREST RATES ON LOANS, INTERNATIONAL FINANCE, INVENTORY, INVESTING, INVESTMENT CAPITAL, INVESTMENT LOANS, INVESTMENT PURPOSES, LACK OF ACCESS, LARGE CITIES, LARGE ENTERPRISES, LEASING, LENDING REQUIREMENTS, LETTERS OF CREDIT, LIABILITY, LIQUIDITY, LIVING STANDARDS, LOAN, LOAN AMOUNT, LOAN AMOUNTS, LOAN ANALYSIS, LOAN APPROVAL, LOAN MATURITY, LOAN OFFICER, LOAN OFFICERS, LOAN PRODUCTS, LOAN SIZE, LOAN SIZES, LOAN STAFF, LOAN TERMS, LOANS FROM FRIENDS, LOCAL GOVERNMENTS, LONG-TERM INVESTMENT, LOW MINIMUM BALANCES, MARKET RISK, MARKET SHARE, MARKET SIZE, MEDIUM ENTERPRISES, MFI, MFIS, MICRO ENTERPRISES, MICRO LOANS, MICROCREDIT, MICROENTERPRISES, MICROFINANCE, MICROFINANCE CLIENTS, MICROFINANCE INSTITUTION, MICROFINANCE INSTITUTIONS, MICROFINANCE LOANS, MICROFINANCE MARKETS, MICROFINANCE SECTOR, MONEY TRANSFERS, MORTGAGE, MORTGAGE LOANS, MORTGAGES, NEW BUSINESS, NEW BUSINESSES, NEW MARKET, OPERATING COSTS, OPERATIONAL COSTS, OUTSTANDING LOANS, OVERDRAFT, OVERDRAFT FACILITIES, PARTNER BANKS, PAYMENTS SERVICES, PEER REVIEW, PERSONAL CREDIT, PERSONAL CREDIT CARDS, PORTFOLIO, PORTFOLIO RISK, PORTFOLIOS, PROFITABILITY, PUBLIC POLICY, PUBLIC RECORDS, RECEIPTS, REGULATORY AUTHORITIES, REGULATORY CONSTRAINTS, REGULATORY FRAMEWORK, REGULATORY POLICIES, RETURNS, RISK MANAGEMENT, RISKY LOANS, RURAL LOANS, SAVINGS, SAVINGS ACCOUNTS, SAVINGS PRODUCTS, SECURITIES, SMALL BUSINESS, SMALL BUSINESS LOANS, SMALL BUSINESSES, SMALL ENTERPRISE, SMALL ENTERPRISES, SME, SME CLIENTS, SME FINANCE, SME FINANCING, SME SECTOR, SUBSIDIARY, SUPPLIERS, SUPPLY CHAIN, SUPPLY CHAINS, TAX, TECHNICAL ASSISTANCE, TRADE FINANCING, TRANSACTION, TRANSACTION COSTS, VILLAGE, WAGES, WIRE TRANSFERS, WORKING CAPITAL,
Online Access:	http://documents.worldbank.org/curated/en/2014/07/24164316/experiences-microfinance-institutions-serving-very-small-small-enterprises-latin-america-based-case-studies-lac https://hdl.handle.net/10986/21715
Tags:	Add Tag No Tags, Be the first to tag this record!