Strengthening of popular finances in Azuay and Cañar

Give alternative financial services to a rural population without access to commercial bank credit to promote local development, capturing their remittances and small savings.

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Azuay
EC Ecuador
Web http://www.eclac.cl/dds/InnovacionSocial/e/proyectos/ec/finanzas/
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Concept

About the project Edit

Location: provinces of Azuay and Cañar, Ecuador

Organisation: Fondo Ecuatoriano Populorum Progressio (FEPP)

The overall objective is to promote a strategy of local development in a context of high international migration through consolidation of a popular finance in rural communities
and marginal urban areas of the Ecuadorian provinces of Azuay and Canar, from the creation, support and partnership of Local Financial Structures (EFL).

In what ways is this project unique and creative? Edit

The social innovation of this project is the creation of a model in which sectors of the population excluded from conventional financial systems organize themselves to save small amounts of money and invest for their own benefit.

With these equity loans, they begin serving the needs of contributors-partners. When you pay the loan and interest, other partner benefits and so on.

Club members are trained and then manage the system. Self-sustaining is necessary to create or improve their business and achieve revenue that improve the quality of life.

What is the social value of this project? Edit

The lessons learned from this project are that communities have the ability to organize and be trained to be responsible for their financial system. The development of the local social capital, through a process of community organization based on trust, can overcome major barriers, such as lack of access to credit.

In addition, the training of participants leads to increase of savings, better use of resources and it incorporates women into community life.

What is the potential of this project to expand and develop? Edit

The impact: 21 Local Financial Structures (EFL) have been established, operating efficiently, with more than 30,000 members and associates, of whom 55% are women.

Today they offer financial products and services to rural and marginal urban areas. There are savings from promoting local capital and remittances. There has been a direct transfer of remittances, with the consequent reduction of costs, interest on loans return to the community and fund the operation of these structures.

What was the triggering factor of this project? Edit

What is the business model of this project? Edit


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