According to a survey conducted by the Multilateral Investment Fund (MIF), an investment fund administered by the Inter-American Development Bank (IDB), loan portfolios of microfinance institutions (MFIs) in Latin America and the Caribbean rose by 13 percent in 2009.
The increase is lower than in 2008, when MFIs’ portfolios grew by 18 percent. According to the survey, there are currently over 700 MFIs operating in Latin America and the Caribbean serving 10.5 million customers.
Mexico was found to have the largest market for microfinance with 2.3 million customers, followed by Peru with 1.9 million and Colombia with 1.4 million. In terms of loan portfolio, Peru ranks first with the equivalent of USD 3.2 million in outstanding microloans, followed by Ecuador with USD 1.7 million and Colombia with USD 1.4 billion.
The average loan size in the region was USD 1,178 in 2009 and the annual average interest on microloans was 28.6 percent on an annual basis.
Additionally, the survey found that penetration of the microfinance industry in the region varies significantly from country to country. Estimated levels of penetration for countries such as Nicaragua, Bolivia, El Salvador and Ecuador exceed 30 percent while in countries such as Venezuela, Argentina, Uruguay and Brazil it is less than 5 percent.
By Witt Gatchell
About Multilateral Investment Fund (MIF):
The Multilateral Investment Fund (MIF) was founded in 1993 by the Inter-American Development Bank (IDB) to promote broad-based economic growth through private sector development, particularly microenterprises and small businesses. The fund partners with small businesses via grants and investment. MIF reports having approved more than 1000 projects, mainly grants, with over 800 civil society, private sector and government partners since its founding. The fund has recently started decentralizing its operations, giving IDB country offices more autonomy to distribute “mini-loans,” with the idea that a greater amount of smaller projects will reach more people. The MIF has 38 donating member countries from Latin America, the Caribbean, North America, Europe and Asia. The United States and Japan, each having contributed USD 500 million, play leading roles in the organization.
Sources and Additional Information:
[1] IDB News Release: “Microfinance lending in Latin America and the Caribbean rose 13 percent in 2009”: http://www.iadb.org/news-releases/2010-10/english/microfinance-lending-i…
[2] Survey (In Spanish): “Microfinanzas en América Latina y el Caribe: El sector en cifras”: http://idbdocs.iadb.org/wsdocs/getdocument.aspx?docnum=35385530
MicroCapital’s Microfinance Universe profile: Multilateral Investment Fund (MIF):
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Mul…
Browse the MicroCapital Universe and add your entry to the wiki at: https://www.microcapital.org/microfinanceuniverse/
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