Apoyo y Servicios Financieros para la Microempresa: Lecciones para El Salvador
Creators:González Vega, Claudio
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Publisher:Ohio State University. Department of Agricultural, Environmental, and Development Economics
Series/Report no.:Ohio State University. Department of Agricultural Economics and Rural Sociology. ESO (Economics and Sociology Occasional Paper). No. 2187
This paper derives lessons for EI Salvador, distilled from theory and from experience elsewhere, about the promotion and financing of small and microenterprises. Equity considerations require both to incorporate the poor into growth processes in the long run and alleviating the costs for them of structural adjustment in the short run. While efficient financial services are important (among other things) for the first task, their contribution to the second is very limited. Credit matters only when productive opportunities exist; thus, the target population are the productive poor. Credit, however, cannot create such opportunities. While not all producers demand credit, most demand deposit facilities. When they demand loans, they want more than funds; they are interested in an established relationship with the intermediary. This requires an image of permanency that only viable institutions can provide. Viability is fiscally sound and introduces compatible incentives. To reach the poor, new fmancial technologies and organizational designs must be promoted.