Microfinance in Latin America and the Caribbean: How Large is the Market?

This paper provides a snapshot of access to financial services in Latin America and the Caribbean (LAC). The report analyzes the past information collected from MFIs and then presents access to financial services information based on a current household survey. The paper explores the magnitude of financial services penetration in the region and tries to answer the following questions:

• What types of institutions are offering microfinance services?
• What is the size of microfinance sector in each of LAC countries?
• What is the potential demand for microfinance?

The report seeks to answer these questions by using data collected from MFIs in 23 countries and analyzing household surveys from 12 countries. The paper further discusses data based on type and size of institutions offering microfinance services in the region. The parameters on which it compares data are:

• Number of institutions;
• Portfolio;
• Number of borrowers;
• Average loan size.

The paper offers a framework to improve measurement of access to financial services in the region. It states that meticulous measurement will help stakeholders understand the limits and potential of microfinance as it has evolved in LAC. It concludes by comparing results from two the sets of data (survey) and analyzes the accessibility of financial services by low-income households.