In a country where microentrepreneurs represent a quarter of the labor force, the BBVA Microfinance Foundation promotes the economic and social development of more than 120,000 vulnerable entrepreneurs. According to a study by BBVA Research, Reality of Microfinance in Chile, enterprising is a key factor to create opportunities in areas where formal employment is scarce.
Through its two entities in the country, Fondo Esperanza and Emprende Microfinanzas, BBVAMF facilitates the financial inclusion of thousands of people who search for an opportunity to have their own businesses. According to Pablo Coloma, managing director of Emprende, during the presentation of the Foundation’s report at the BBVA Chile headquarters, “the country urgently requires more and better financial inclusion for self-employed persons and microentrepreneurs”. That is why, the Foundation’s entities offer not only products such as credits and insurance, they also provide financial training and education.
“The country urgently requires more and better financial inclusion for self-employed persons and microentrepreneurs”
“To be affiliated with Fondo Esperanza gives us the opportunity to build up our businesses thanks to our training. They take into consideration our enterprise and ability to work, more than our wealth”, declared Miriam, one of the Chilean woman entrepreneurs served by the BBVAMF. By means of the School for Entrepreneurs and economic support, Fondo Esperanza contributes to the success of more than 110,000 entrepreneurs it serves, 83% of them women. Stephanie García Van Gool, director of BBVAMF’s Impact Assessment, noted that, “although they run small businesses, Fondo Esperanza’s entrepreneurs achieve high growth rates in sales (43% annually) and surpluses (54% annually), all under the context of an economic slowdown”.
Emprende Microfinanzas, the Foundation’s other entity, also delivers the same support to its entrepreneurs. Out of over 10,000 people it serves, half of them possess primary education at best and 33% live in rural areas. Despite of this and according to the BBVAMF’s 2016 Social Performance Report, almost 10% of them have generated at least one additional job position.
Reality of Microfinance in Chile, a study by BBVA Research
Out of the almost two million microentrepreneurs in Chile, 700,000 are women, as reflected by a study of BBVA Research. The analysis was conducted on the occasion of the presentation of BBVAMF’s annual report, to understand the reality of the people served by the Foundation in the country. Entitled Reality of Microfinance in Chile, BBVA’s research arm sustains that almost 70% of the entrepreneurs are above 45 years old and less than half finished secondary schooling.
The women, who head nearly 50% of low-income households set up businesses to generate income and be able to combine their day jobs with domestic chores and/or childcare. They constitute the majority of the Chilean enterpreneurs whose microenterprising activities are run in their homes, and their businesses usually present low productivity. 66% of them generate monthly incomes of around 550 USD.