Productive credit under adequate conditions generates a lasting positive impact to the extent that it is an important factor in creating value and boosting the economy; and in low-income, urban and rural sectors, it contributes to reducing poverty.
The definition of Popular Economy that the Government has adopted covers all the economic activities of people who to date are excluded from access to formal credit, either due to their high level of risk and high operating costs that processing credit means for financial institutions of low amount; Likewise, due to the lack of suitable guarantees, the process to access it and the lack of financial education that allows them to know the credit conditions, the available guarantees, the access channels and the form of payment of the same that adjust to the income streams of the businesses they develop.
In the first wave of banking, called opportunity banking, it was aimed at improving the population’s access to financial products, particularly a savings account or a debit card, and expanding access channels such as banking agents, banking virtual and mobile banking; likewise, microcredit was promoted as a strategy to reduce gout due to its exorbitant rates and unorthodox collection methods. However, progress in this field still has ample room to grow given that of the 90% of those who have a financial product, only 30% have accessed credit. Perhaps, the microcredit interest rate, very close to the usury rate, in almost all financial entities supervised and not supervised by the Superfinanciera, constitutes an access barrier because at that rate few businesses can generate surpluses.
Placing a million credits to the sectors of the popular economy in the next 4 years constitutes a challenge, which requires developing policies, strategies, clear and well-synchronized support instruments, and financial products designed according to the activity they carry out so that the supreme objective of the Program has the expected impact. Not only is it to meet the placement goal, but it also has an impact on the quality of life of those who access it.
Effective institutional coordination is also required from the Ministry of Finance to guarantee that the entities participating in the Government in the first place, and then the private institutions, develop agile and transparent procedures that facilitate access for the Program’s target population. It is a priority that entities such as Bancóldex, Finagro, Banco Agrario and guarantee funds (FNG and FAG) have physical and human resources, distribution channels, technology and support for potential clients, both for urban and rural and agricultural activities. to ensure the success of the Program.
Jesus Antonio Vargas Orozco
Business Consultant
Jesusvargas.orozco@gmail.com
2023-05-11 02:53:38
#Credit #popular #economy
