Access to credit: key to the survival of SMEs in Peru 2024

In the context of a Peru still facing economic challenges in 2024, access to credit has become a matter of vital importance for micro and small enterprises (mypes). According to a study by the Peruvian Institute of Economics (IPE), the situation is concerning: by mid-2023, 8% of urban households nationwide admitted to having resorted to informal credit in the past year. This figure rises significantly in the eastern region of the country, where one in five households has taken out a loan from informal lenders or pawn shops during the same period. The reason behind this trend is clear: many entrepreneurs, especially those without a credit history or those with negative reports on Infocorp, are forced to seek alternative sources of financing. Informal loans are often used to pay off debts, invest in businesses, or cover basic needs, highlighting the fragility of the financial situation for many entrepreneurs in the country. However, in light of this scenario, the formal financial sector is beginning to open its doors to these entrepreneurs. Juan Diego Cañamero, manager of Prestaclub, highlights the growing financial inclusion in Peru as a positive sign. "We believe in the power of entrepreneurship to drive economic growth and innovation," he states, emphasizing that more and more institutions are designing accessible financial products aimed at providing relief to those who have traditionally been ignored by banking entities. One of the most convenient alternatives for accessing loans without a solid credit history is through loans backed by mortgage guarantees. Entrepreneurs can apply for loans ranging from S/ 10,000 to S/ 1 million, using properties such as houses, apartments, land, or commercial premises located in Lima or Callao, as long as they are properly registered in Public Registries. This modality presents an immediate solution for those in need of financing to operate or expand their businesses. The process is relatively straightforward: interested parties only need to present their valid National Identity Document (DNI) and, in some cases, 18K, 21K, and 24K gold jewelry as additional collateral. This flexibility in requirements can be crucial for many entrepreneurs who, instead of resorting to informal credit, can opt for a more formal and secure option. It is important to mention that, in addition to the ease of access to credit, Juan Diego Cañamero emphasizes the importance of legal and financial advice that accompanies these loans. Entrepreneurs who access these loans will receive the necessary support to make informed financial decisions, contributing to more responsible management of their resources. The growth of fintech companies in the region has also created a more favorable environment for innovation in the financial sector. However, it is essential that these advancements are accompanied by appropriate regulation. Some sector players have expressed the need to establish a regulatory framework that protects entrepreneurs without stifling the necessary innovation for the sector's development. The ability of financial institutions to adapt to the needs of entrepreneurs is key in this process. As more financing alternatives become available, it is essential that entrepreneurs are informed about their options and can choose the one that best suits their circumstances. In conclusion, the path towards financial inclusion for micro and small enterprises in Peru seems to be unlocking new opportunities. Although challenges persist, the opening of new financing avenues, along with timely advice, can make a difference for many entrepreneurs seeking to move forward in a complicated economic environment. The hope is that more actors in the financial system recognize and support the potential of entrepreneurs, thereby contributing to the country's economic growth.