PRODUCTS AND SERVICES
This offer is extended according to the level of progress in each country, with credit cards for business supplies, lengthening of loan repayment periods, and instruments such as financial leasing (El Salvador, Colombia), or commercial paper (Chile, where it is referred to by its Spanish name - factoring). An interesting experience that is forthcoming in several countries, such as Peru, is the introduction of financing arrangements based on production or value chains, normally in the agricultural sector. Besides providing a specific finance product for producers, this system has the added value of driving banking penetration amongst those microenterprises that are far removed from financial institutions for reasons of either geographical remoteness or because they are not part of the financial institution’s target business segment.
Regarding the capping of the price of credit, Latin America’s experience shows that any limitation turns against the actual microenterprises, by reducing the presence of lenders as they do not consider it viable to assume the credit risk with the microenterprises, or by affecting the transparency of their operations, as it conceals the true price of the credit by including those additional costs under other headings.
Concerning the attraction of funds from the public, the products are the usual ones for sight accounts, fixed-term savings and term deposits. It should be noted, following what has been said in the section Institutions, that there is a growing number of them capable of and interested in attracting funds from the public, with the ramifications that this has by introducing financial flows into the system and driving banking penetration.
