MICROCREDIT AND SME CREDIT: FINANCIAL MARKET SITUATION AND ITS EFFECT ON EMPLOYMENT

Abstract

The objective of this article is to analyze the financial market situation in Bolivia, placing special emphasis on Microcredit and SME Credit, understanding that in recent years they have experienced sustained growth and have become a pillar of national economic development, particularly due to the incorporation of banking institutions into the competition to attract clients from these sectors and because they have become a sector that contributes to job creation.The aim is to show how, through the provision of financial services, various economic sectors classified as informal can be subject to social and economic inclusion and, through this dynamic, improve their poverty situation.

Financial services for the Micro, Small, and Medium enterprise sectors have multiplied; the financing offer is varied; and innovative methodologies specifically adapted to these sectors have been developed, which has revolutionized and increased the loan portfolio of these sectors. The Microcredit and SME loan portfolio increased by 37,64% between 2006 and 2012. Since 2012, growth has been sustained at an average of 11,25% per year. Growth expectations for the coming years are even greater given the looming economic and financial crisis.