Micro-financing and development

This line of research covers the prospective study of the structure and trends of financial markets and their respective regulatory frameworks, for the purpose of promoting development processes with equity through different credit modalities, (micro-credit, micro-leasing, etc.). In other words, the goal is to study the results and real impacts of credit as an instrument for the capitalization and conversion of micro, small and medium businesses, with special attention to those in the hands of the most vulnerable and poorest sectors of the countryside and city (women, youth, peasants and wage workers with little or no land, etc.). It is also aimed at evaluating the effects of credit as a poverty reducing mechanism.

The study of micro-financing and its effects on development includes the analysis and evaluation of concrete experiences in which the offer of financial services has been associated with the complementary offer of non-financial services (training, managerial assistance, technology, etc.) to micro, small and medium businesses, as Nitlapan has been doing in collaboration with the Local Development Fund (FDL), one of its main strategic partners. By systematizing and evaluating these concrete experiences, designed and implemented with the aid of its institutional partners, Nitlapan is promoting their replication by the institutions that promote development.

The line of studies on micro-finances and development is of equal interest for the study of the effects and impacts of credit on environmental protection and conservation. In this direction, the Nitlapan Research Program collaborates with the Business Development Services Program (SDE) in the design and implementation of monitoring and evaluation systems for the environmental services generated by agricultural and forestry producers in the framework of institutional initiatives that combine financial incentives with non-financial ones. The Research Program helps systematize the lessons from such experiences, so they can be converted into useful input for institutional policy formulators and decision-makers.

Specific topics of this line of research are, among others:

• Environmental performance of micro-finance institutions.

• Design of instruments and methodologies to improve the social performance of micro-finance institutions.

• Impacts of the financial and non-financial products on marginalized sectors and on poverty—including the effects on access to land.

• Prospective territorial analysis of potential demands for micro-credit.