Bringing Microfinance Services to the Poor : Crediamigo in Brazil
Among policymakers and economists, there is a widely held perception that microenterprises1 face severe financing shortages that limit their growth opportunities. Resolving the problems of access to finance as well as the high cost of financing has...
| Main Authors: | , , |
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| Language: | English |
| Published: |
World Bank, Washington, DC
2012
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2002/08/2512036/bringing-microfinance-services-poor-crediamigo-brazil http://hdl.handle.net/10986/10405 |
| Summary: | Among policymakers and economists, there
is a widely held perception that microenterprises1 face
severe financing shortages that limit their growth
opportunities. Resolving the problems of access to finance
as well as the high cost of financing has become the main
objective of many government programs. With a view to
increasing access to credit for microenterprises in the
Northeast Region of Brazil, the World Bank has supported
Banco do Nordeste's CrediAmigo microfinance program
since 1997. This note describes how Banco do Nordeste
initiated CrediAmigo as part of its restructuring strategy
and how the program has expanded to become the largest
microfinance provider in Brazil. To date, many lessons have
emerged, both from CrediAmigo and the World Bank project
that supports the program. Brazilian private banks and
non-bank financial institutions offer a variety of credit
products targeted to micro and small enterprises. These
products typically carry very high interest rates and
require collateral. Banking networks also leave many areas,
particularly poor and remote regions in the Northeast and
North of Brazil, underserved. About 57 percent of all
municipalities in these regions have no access to a bank
branch, compared to a national average of around 30 percent.
Although in many other Latin American countries,
microfinance institutions have been able to partially fill
the gap left by larger institutions, in Brazil, only a small
fraction of the potential demand for microfinance appears to
be satisfied by the current supply. |
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