Surveying Microfinance Clients in GuatemalaMichael Fryar

FINCA Client Assessment Research Fellow, Brown Fellow at Centre College

FINCA’s Mission:(1) To provide financial services to the world’s lowest-income entrepreneurs (2) so they can create jobs, build assets, and improve their standard of living

What is microfinance?

Financial services, such as loans, insurance and savings, provided to

those excluded from the formal financial system.

How “micro” is a microloan?FINCA Guatemala’s median loan size

is USD 400.

Who is a microentrepreneur?

Client Assessment Research:

Evaluate if FINCA is reaching its mission by (1) determining poverty levels and (2) examining the connection between FINCA’s services and client business indicators.

FINCA Guatemala

The research was completed with the help of five locally hired surveyors whom I trained to follow international best practice. Between June 13th and August 2nd, we visited all 29 of FINCA Guatemala’s branches and attempted to reach 600 randomly chosen clients. All interviews were conducted in person and most often took place in the client’s home. In total, we interviewed 443 clients.

Client Demographics

Business IndicatorsA large majority (70%) of clients had only one business. The most popular business was retail (50%) followed by food service (20%). While fewer than 20% of clients with group loans had employees almost 40% of clients with individual loans had at least one part-time employee.

Household Expenditures

Poverty

Catarina Yolanda makes traditional beaded belts.

The average FINCA client interviewed was a 38-year-old female living with a family of five and had worked with FINCA for a little more than one year. More than a third of clients had no school-aged children and nearly 75% of those with school-aged children had only one or two children. Roughly one third of interviewed clients were indigenous.

Livni Gomez weaves traditional blouses and sells baked goods.

government, 66% of clients are poor, 12% higher than the national average. Furthermore, 20% of clients are unable to meet basic calorie requirements. Clients who have been with FINCA more than two years are more likely to be non-poor.

The largest part of a client’s monthly budget goes towards food. Although women reported spending more on food than men, women did not spend significantly more on health or education.

ConclusionFINCA Guatemala’s clients are not only low-income but poorer than average. Clients who had worked with FINCA for more than two years were 9% more likely to have at least one employee and 7% more likely to spend more than $4.00 per person per day than newer clients. When asked to choose one word to summarize their experience with FINCA (see right), 99% of clients reported a positive experience.

Map of Guatemala with FINCA branches and the number of clients from each

branch that were interviewed.

Guatemala City Detail

According to the poverty lines established by the World Bank, 16% of clients live in poverty, with rural and indigenous clients being the poorest. Using the poverty line established by the Guatemalan