Group lending in Ecuador: situational analysis in Credit Unions
Abstract
The objective of this article is to analyze the relevance of credit products offered by Ecuadorian Credit Unions of segment 1, with emphasis on the importance of group lending technologies for lenders and borrowers. The text analyzes the relationship of group lending with the Popular and Solidarity Economy, as well as the potential benefits that its implementation would have in the operations of cooperatives and also in the social and economic sphere of the borrowers. The bibliographic review on experiences of Ecuadorian group lending determines the little interest of the National Financial System (NFS) in providing solidarity group credits; In fact, only 4% of segment 1 savings and credit cooperatives currently offer this type of loans to their members. The conclusions of the research are aimed at contrasting the benefits of group lending technologies as a way to minimize problems of adverse selection, versus the regulatory and economic reality of the NFS, as well as understanding that, although financial inclusion processes are necessary in Ecuador, there is apparently no majority interest in segment 1 cooperatives to address this problem through the development and implementation of alternative credit technologies.
Received: 24 April 2024
Accepted: 15 June 2024
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