Rural Microfinance in Colombia and Financialization Process: A Case Study

Abstract

The deregulated growth of microfmance represents a threat to the sustainability and fulfillment of its mission. This paper aims to analyze the development of rural microfmance in Colombia, going beyond the study of financial inclusion. With this purpose, a qualitative research method is applied together with the review of financial indexes related to the offer of microcredits to the Colombian rural sector. In addition to the national study, Survey on The use of microfinance products and services in rural areas 2018 was carried out and analyzed for deepening in the local and regional perception of microfinance services in seven municipalities belonging to the categories 4, 5 and 6 of Boyacá and Santander states. Throughout this analysis, it is evidenced that rural microfinance is not per se a solution for poverty, but it is consolidated as an instrument through which the productive initiatives of the Colombian countryside could be viable and sustainable, which is why they serve as a complementary tool of rural development policies.