Banco Solidario, S.A. (BancoSol) is a microfinance institution that provides credit to microenterprises throughout Bolivia, increasing employment opportunities and facilitating the growth of small businesses and income in this sector. The bank has progressed from 1992 when it only offered solidarity credit to micro businessmen and since 2002 has offered seven different loan products. Since its inception, BancoSol has served more than one million customers and financed loans worth nearly $1.1 billion.
BancoSol offers financial services to microentrepreneurs with the goal of promoting growth in operations, self-sufficiency and savings. Products include:
- Sol Individual – loans for micro entrepreneurs who are established in their businesses.
- Solidario – loans to microentrepreneurs, in groups of three or four people, who share the responsibility for servicing the loan.
- Sol Vivienda – mortgage loan funds up to 80% of the commercial value of the home.
- Sol Efectivo – a consumer loan that targets wage earners that work for companies with a proven track record. The credit can be assigned to working capital, investments, and other personal consumer needs.
- Sol Vehiculo – loans to finance automobiles for personal use and vehicles for public transportation.
- Solicita – a commercial loan for experienced microentrepreneurs with a clean credit history, increased working capital and investment capital.
- Sol de Oro – loans backed by gold jewelry to meet
emergency liquidity needs.
BancoSol also offers Bank Guarantees, Personal Insurance, Savings Accounts, Debit Cards VISA Electron, Time Deposits, National and International Drafts, International Remittances, Utility Payments, and Tax Payments.
Investments by individuals, as well as institutions such as the Calvert Foundation, provide the lending capital to BancoSol.
Entrepreneurs with a small capital base but dynamic adjustment capabilities make up BancoSol’s core clientele. BancoSol mostly serves people in major urban areas of Bolivia, specifically La Paz, El Alto, Santa Cruz, Cochabamba, Oruro, and Chuquisaca. Sixty-nine percent of BancoSol clients are from major urban areas, 21% are from minor urban areas, and 10% are from rural regions. Half are Latino and half are indigenous.
Fifty-six percent of BancoSol’s clients are women and 95% of the borrowers have household income at or below 80% of area median income. Most are young, predominantly 35-40 years old, with low levels of education.
Despite its small loan size, BancoSol has proven to be one of the soundest banks in the country, consistently placing at the top in key indices of asset quality, solvency, and risk.
- Served more than one million clients since 1992
- Provided and financed over loans worth more than $1 billion since 1992
- Provided 12,021 housing project loans worth $39,577,760 through June 2005.
By financing microbusinesses and housing projects, BancoSol has helped create more employment opportunities and given impoverished households a chance to change their lives.
Elvira Mamami uses embroidery to support her daughters. Though she embroiders daily, it was hard to get ahead without any capital. Luckily, she heard about BancoSol. Although she had no collateral, the bank made Elvira a loan of $300. The investment paid off and Elvira repaid the entire loan on time. Now that Elvira has seen how one loan increased her revenue, she plans to request $600 to invest in a modern sewing machine to improve efficiency. Full Story