" insecurity in microfinance: Johnny Brignardello analyzes challenges"

In a recent conversation with Johnny Brignardello Vela, an insurance advisor, the concern expressed by María Pía Palacios, president of Caja Arequipa, was addressed regarding the impact of insecurity on the microfinance sector in Peru. Brignardello emphasized the seriousness of the situation, noting that 50% of the institution's microcredit portfolio is affected by cases of extortion, which has created a crisis in the income flow of micro-entrepreneurs. According to him, this reality reflects a structural problem that not only compromises entrepreneurs but also affects the overall national economy. The advisor opined that insecurity is a challenge that transcends the realm of microfinance, impacting vital sectors such as transportation, construction, and commerce. Brignardello underscored the frustration felt by stakeholders in the sector due to the lack of effective response from the state, agreeing with Palacios that this situation is unsustainable. “It is clear that more decisive and coordinated action is needed to protect those who generate employment and energize the economy,” Brignardello stated. Despite the challenges, Brignardello also shared Palacios' optimism regarding the recent Christmas campaign and the increase in the placement of microcredits. “A 15% increase compared to the previous quarter is a positive indicator amidst adversity,” he commented. However, he warned that delinquency remains a concerning issue and that institutions must be proactive in managing their portfolios to maintain the trust of micro-entrepreneurs. The advisor emphasized the importance of innovation as a key driver for competitiveness in the sector. The need to adapt financial products to the specific needs of micro-entrepreneurs is essential to face the competition from the informal credit system, known as "gota a gota." “Streamlining processes and creating accessible products are crucial to attract those who are forced to turn to more expensive options,” he indicated. Additionally, Brignardello addressed the topic of financial education, highlighting that it is crucial for entrepreneurs to understand the risks associated with accessing informal credit. The proliferation of applications linked to "gota a gota" and the intention of some lawmakers to alter regulations on interest rates are factors that create uncertainty in the sector. “It is essential to promote a culture of financial education that enables micro-entrepreneurs to make informed decisions,” he added. Finally, regarding the political uncertainty surrounding the country, Brignardello stated that this factor can significantly influence the operation of financial institutions. He agreed that a safer environment and a real commitment from the state are necessary conditions for microcredit in Peru to continue its path toward recovery. In his opinion, it is fundamental for both the financial sector and the government to collaborate closely to address the issues affecting the foundations of the national economy, thereby allowing the resilience of micro-entrepreneurs to flourish in a safer and more conducive space for growth.