The BBVA Microfinance Foundation’s institution in Peru serves more than half a million entrepreneurs nationwide
To accelerate processes and offer better services to clients, Financiera Confianza leverages technology, enabling it to reach remote areas where people are more vulnerable due to their lack of access to many services, including financial products. According to the BBVA Microfinance Foundation’s Social Performance Report presented this morning in Lima, 26% of the over 210,000 borrowers that it serves live in rural areas.
“Technology is vital to reach these places, where poverty is concentrated. In fact, 68% of rural clients who were poor they took out their first loan, crossed the poverty threshold in the third year of working with our institution”, assured the head of Impact Measurement & Strategic Development at the Foundation, Stephanie G. Van Gool.
The general manager of Financiera Confianza, Luis Germán Linares also described how “the technology-based tools we’re developing enable us to be more efficient, have wider outreach and give faster service to more people. We try to take the branch office to the clients’ homes or their places of work. That way, we have more time allotted for financial education, which complements our mission in remote areas.”
The financial advisors at Financiera Confianza take mobile devices with them when they visit the entrepreneurs’ businesses. Using an app designed by the Foundation, they can respond to their clients’ needs so that the latter won’t have to spend time and money to make a trip to a branch office. The app also lets the advisors perform credit scoring and geolocalization for the businesses without internet connection; information is stored and will synch with the advisors’ portfolio data once they go online.
According to Carolina Trivelli, former minister for Social Inclusion & Development in Peru, poverty in the country is largely concentrated in the countryside, and financial inclusion plays a decisive role in reducing it. “The challenge is for 75% of the population to get a bank account by 2025,” she stated during the event.
The secretary for Gobierno Digital (Digital Governance) for Peru, Marushka Chocobar, explained that since digitalization is a process that can impact everyone, the government is working actively with the private sector to improve digital inclusion.
In the panel entitled “Technology and Microfinance to create opportunities for rural development”, moderated by Sandra Jaúregui, Financiera Confianza’s general manager for Economic Studies; participants included Carolina Trivelli, former minister for Development and Social Inclusion; Marushka Chocobar, secretary for Gobierno Digital (Digital Governance) for Peru and Financiera Confianza’s general manager, Luis Germán Linares
The closing of the event was led by the deputy head of International Relations & Communication, Óscar Basso. He declared that “digital transformation and technology, along with an understanding of clients, make it possible to offer products that are designed to meet the needs of vulnerable groups.” He then highlighted the Foundation’s committed effort to continue developing a model based on support and advice, as well as its methodology for social measurement.
Financiera Confianza is the only microfinance institution in Peru with nationwide coverage
“We already serve over half a million people throughout the country, with both credit and savings products, and we provide technical advice to help them progress over time. As the Social Performance Report describes, the entrepreneurs’ assets are growing close to 30% each year. That means they are accumulating wealth and can reinvest it in their business to keep on growing,” explained Stephanie G. Van Gool.