Elements used for risk assessment by microfinancers: the case of the Peasants’ Cooperative Association from Zacapoaxtla, México

Abstract

México has a reduced offer of microfinancing services in rural areas as a result, among others, of the difficulty of microfinance institutions to evaluate with greater certainty the risk of non-payment. This research seeks to contribute to improve the risk assessment tools, delving into the survival strategies of the rural population, and into their organizational forms for decision making as factors that influence loan payments. For this purpose, the diversity of economic activities that are carried out in the domestic group were identified, as well as the way in which they are organized for decision making, and women’s participation in the latter. Then, the relationship between these variables and the incidence in risk for lack of credit payment were analyzed. The research used as study unit the Zacapoaxtla Peasants’ Cooperative Association, located in the state of Puebla, México. The results show that the diversity in economic activities and the organization of the domestic group in terms of women’s participation have a positive influence on the payment of credits attained.