feb. 11, 2014
Por Ryan Tang
Despite efforts from microfinance practitioners and donors to develop microfinance in the Caribbean, uptake of formal microcredit has lagged behind expectations in some cases. Meanwhile, anecdotal evidence indicates that many microentrepreneurs continue to use informal financing alternatives, such as rotating savings and credit associations (ROSCAs), moneylenders, and supplier credit. This raises important questions about the potential for microfinance in the Caribbean. Why do some microentrepreneurs still turn to informal mechanisms instead of formal microcredit to finance their business? What characteristics of financing are most important to Caribbean microentrepreneurs?