WORKSHOP REPORT
PROMOTING RURAL SAVINGS Financial inclusion is one of the main measures that governments and cooperation agencies are promoting as an effective tool for overcoming the poverty that still persists, especially in rural areas of Latin America and the Caribbean, in spite of the high rates of economic growth these countries have experienced in the last decade. Against this background, CORDAID Investments has supported different types of organizations and institutions taking forward activities and projects focused on the financial inclusion of rural people living in poverty.
the same time avoiding raising operating costs to levels that place the institution’s profitability at risk. ~~ Activate exclusion checklists to avoid financing activities that are harmful or damaging to the environment. It is worth mentioning that good progress has been made in this area, as most of the institutions have already taken action and introduced checklists of environmentally harmful activities that they will not finance.
CORDAID Investments has partnered with FOROLACFR to organize a series of workshops to enable these institutions and organizations to share knowledge and disseminate and improve their practices. The first of these workshops, called “Innovative Experiences in Promoting Rural Finance,” was held in the city of San José in Costa Rica on 10 October 2011. It focused on credit-related experiences and was divided into three panels: Adapting Technological Innovations to Provide Rural and Agricultural Credit; Financial Inclusion through the Expansion and Penetration of Appropriate Financial Products and Services for Rural Areas; and Green Products and Rural Finance in the face of Climate Change and GM Crops1.
~~ Regulatory frameworks suited to the characteristics of the rural sector. One of the concerns expressed by several institutions is that most countries in the region do not yet have an appropriate regulatory framework that would facilitate consolidation and promote the development of financial products suited to the rural sector.
Following the presentations and discussions, the workshop concluded by identifying several challenges faced by the institutions and organizations in their work to include the rural poor. Here are some of the challenges identified:
~~ Promote responsible saving. Savings are an important means to achieve the consolidation of microfinance institutions that find it difficult to obtain funds from international cooperation agencies.
~~ Expand the portfolio of products: Rural producers require a wide range of financial products designed specifically to meet the needs of clients. Institutions therefore have the challenge of creating financial products while at 1. The workshop report is available in English and Spanish on the FOROLACFR website: www.forolacfr.org
~~ Promote financial education as a means to support a better use of financial resources. Financial inclusion should be accompanied by financial education to avoid the problems of misuse of funds or over-indebtedness.
~~ The linking role of networks. Networks have great potential to promote rural finance, both because of the economies of scale they can facilitate for product development and because of the lobbying they can engage in with the public sector to promote more favourable policies
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or regulatory frameworks for rural finance. ~~ Maintain and expand sources of funding. The development of inclusive financial products requires significant amounts of funds. This means it is not only necessary to maintain current sources of funding but also to seek to engage governments and private enterprise in promoting rural finance. To follow up on the Costa Rica workshop and the challenges listed above, CORDAID Investments and FOROLACFR organized an Experience-Sharing Workshop for CORDAID partners on “Promoting Rural Savings in Latin America,” which was held in Panama City on 4 June 2013. The workshop was divided into six sessions. The first was a presentation of the conclusions and challenges identified in the Costa Rica workshop. This was followed by the keynote address given by Olivier Pierard, entitled “Rural Savings and Access Problems in Latin America.”2 Next, Panel I discussed Experien2. Olivier Pierard is an agricultural engineer of Belgian nationality, who
ces of Mobilizing Savings in Regulated Institutions, with presentations of the experiences of the CREDINKA Rural Savings Bank in Cusco and the Mexican Association of Social Sector Credit Unions (Asociación Mexicana de Uniones de Crédito del Sector Social AMUCSS) in Mexico3. The topic discussed in Panel II was Promoting Rural Savings in Cooperatives, looking at the cases of the COMIXMUL Cooperative in Honduras and the Private Financial Development Organization (PFDO) PILARH. Next, Panel III discussed Strategies for Promoting Savings in Non-Regulated Institutions, looking at the cases of CRECER in Bolivia and PRISMA in Peru. The final session of the workshop discussed the main conclusions and challenges faced by the institutions and cooperation agencies in promoting savings in Latin America. currently lives in Mexico. He has more than 20 years of experience in rural microfinance, and rural savings in particular. He has worked in several countries in Latin America and Africa, and is the author of numerous publications on the subject of rural finance. 3. AMUCSS is not a CORDAID partner but it was invited to attend the workshop because of its work on mobilizing rural savings in Mexico.
1. K eynote Address Rural Savings and Access Problems in Latin America In his keynote address, Olivier Pierard first explained that savings are a relatively recent topic in microfinance, which emerged in the 1980s with innovative credit technologies in NGOs that were not authorized to hold savings. The aim was to help the poor by offering credit. This situation has been changing, however. Based on the Grameen experience, institutions realised that the poor are able to save. Cooperatives also learned how to operate microfinance, and they are now an important player in the sector. Nevertheless, it is still necessary to move ahead with rural savings. Pierard also addressed different conceptual aspects of savings. In classical economic theory, saving was linked to income and consumption, and this led to the conclusion that the poor do not save. More recent theoretical developments, however, maintain that saving is linked
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to factors such as the seasonal nature of income, the distribution of available cash, and the management of risks. These factors are critical for the poor, and hence it may be said that the poor do not have the luxury of not saving, or that they are “too poor to survive without savings.” Pierard pointed out that in general terms there are two forms of savings: cash savings and in-kind savings. In rural areas in-kind savings predominate, mainly because people do not have access to cash savings facilities or, if they do have access, it is very costly. Nevertheless, when they are given the opportunity people prefer to keep cash savings in financial institutions. One point to highlight from the presentation, and which later became an important issue in the discus-
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sion, was whether or not a key feature of saving is that it must be voluntary. In Pierard’s opinion, saving must be voluntary, otherwise it cannot be considered saving. When saving is obligatory and a loan is made conditio-
nal on it, savings can turn into a cost that people have to cover in order to obtain the loan.
Factors that act as constraints A series of factors that hinder financial institutions from attracting savings in rural areas were identified. These include: legal arrangements and the legal framework, supervision requirements and the regulation of financial intermediation, lack of knowledge of savings methodologies, an institutional approach that focuses on credit, and the availability of sources of funding that are cheaper than micro-savings. On the demand side, the main factors limiting access to savings are the high transaction costs rural people incur. These range from the commission charged by banks and the cost of opening an account to the time and cost involved in travelling to bank branches to make deposits. Another important factor hampering access to savings are bank opening hours, which are often incompatible with farmers’ working days. Language
barriers and unhelpful treatment by staff may also act as constraints on saving. Two strategies can be identified in attracting savings. One is where institutions give priority to attracting savings as a source of capital. The other is where savings are seen as a way to provide financial services to certain groups of people who need to save. In the course of the discussion it became clear that although these approaches are not necessarily mutually exclusive, with the savings-as-service approach the amounts that tend to be deposited are usually not very large, especially in the early stages. In other words, it is very difficult to sustain a funding strategy based on micro-savings, although micro-savings may turn out to be much more stable and safe for institutions than large savings deposits..
Factors that favour success The speaker went on to mention the factors that determine successful savings products. These include offering unrestricted and quick deposit and withdrawal services. Security, convenience, friendly service, yields and potential access to credit are other aspects valued by customers. Financial education is another very important factor because it shows people the advantages of saving money, speeding up processes that would take much longer in the absence of financial education. In addition, institutions should diversify their client base in order to build up a sustainable and profitable portfolio of savers. Institutions should have rural and urban, poor and non-poor clients. There is a wide range of savings products that are popular with clients. The most important are: on-demand savings accounts, where the savings are immediately available, there are no transaction charges and clients can use ATMs; savings accounts for schoolchildren, which involve schools and offer prizes; planned savings accounts, with savings plans drawn up in advance with
clients to generate capital over a certain length of time; retirement savings accounts, which are similar to the planned ones but involve making deposits over a longer period of time with the aim of generating capital or a monthly income for retirement. Institutional factors also have an influence on the ability to attract savings. Institutions that are more embedded in the communities where they operate are more successful in attracting savings. This is because trust is an essential factor in saving, and deeper roots mean greater trust. By way of a conclusion, Pierard pointed out the need to strengthen savings services in order to reach rural people more effectively. The aspects that need to be worked on further include the design of innovative products aimed at vulnerable rural groups, and reducing transaction costs by serving different client communities (cross-subsidies). Technology should play a very important role both in innovation and in reducing transaction costs.
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In Pierard’s view, microfinance institutions face the challenge of meeting the demand for financial services for the poor, including the demand for savings facilities. To take on this challenge successfully, institutions
will have to adopt the latest technologies, reduce their costs and forge alliances with other institutions to broaden the range of services offered.
Comments The presentation raised several important issues regarding the promotion of rural savings. One of them was regulation. During the discussion it was mentioned that in many countries in the region regulation still does not promote the holding of rural savings by microfinance institutions. Regulation is necessary to mobilize savings, as it reduces the probability of fraud and creates trust, but current regulatory arrangements were designed with banks in mind, and they are still not interested in rural savings. Another point discussed was voluntary saving. It was mentioned that some programmes that have compulsory saving components, such as community banks, have turned out to be beneficial, because they produced learning that was helpful in mobilizing voluntary savings. Participants also debated whether the penalties that planned savings accounts carry could mean that they have compulsory elements, but most agreed that planned saving is voluntary and the penalties are
established beforehand in the contract. With regard to the question of savings as services for the community or savings as a source of capital, participants agreed that these two approaches to savings do not have to be mutually exclusive and can be complementary. It is not healthy for institutions to rely solely on large savers, because if they withdraw it can cause serious liquidity and stability problems for the institution. It is more advisable for institutions to have a diversified portfolio of savers, including small savers who may not be profitable individually but when taken together make institutions more stable. It was also pointed out that institutions need to know what financial services people require in order to be able to design savings products that are suitable for rural people. Only then will they be able to take advantage of the latest technologies and design products that can reach rural people at the lowest possible cost.
2. P anel I Experiences of Mobilizing Savings in Regulated Institutions Two experiences of mobilizing savings in regulated institutions were presented in this panel: the CREDINKA Rural Savings Bank in Peru and AMUCSS in Mexico.
CREDINKA Rural Savings Bank The CREDINKA Rural Savings Bank is based in the department of Cusco in the highlands of Peru. It is a regulated financial institution under the supervision of the Banking, Insurance and Pension Funds Superintendency (SBS). Founded in 1994, it currently operates in nine of the 24 regions of Peru.
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CREDINKA’s presentation focused on its experience of literacy and including rural women in the financial system through savings. In 2002 CREDINKA signed an agreement with the Cusco-Puno Corridor Project which lasted until 20084. The aim of the agreement was 4. The Cusco-Puno Corridor Project was a development project implemented by IFAD and the government of Peru in the communities along the main road between the cities of Cusco and Puno
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to promote the opening of planned savings accounts by women from rural communities in the area covered by the project5.
incentive6. CREDINKA is also promoting planned savings accounts on its own initiative in the high Andean regions of Cusco and Arequipa.
The project undertook to provide financial education to the women and offer them cash incentives to open an account and keep it going. CREDINKA agreed to set a preferential rate for the accounts, provide a life insurance policy to the account holders and train the women leaders who were selected to promote the project. As a result of the agreement, 5,500 planned savings accounts worth 5 million soles (US$1.85 million) were opened.
Because the women savers needed to invest in their productive activities, CREDINKA designed a productive credit product called CREDI WARMI. The results to 30 April 2013 show that 57% of all savers withdrew their savings, and 10% of these opened fixed term accounts, while 43% are still actively using their accounts. It should be mentioned that 28% of the women savers from the Cusco-Puno Corridor Project have obtained loans, but the equivalent figure is only 2.9% in the case of the Southern Highlands II project. Finally, although no systematic research has been carried out, the women’s testimonies indicate that the project has contributed to the empowerment of women.
CREDINKA is continuing to promote planned savings accounts, and has signed agreements with the Southern Highlands Development Projects I and II for the financial education component, but without the cash 5. The Cusco-Puno Corridor Project signed a similar agreement with the Los Andes Rural Savings Bank in the Puno region.
6. The Southern Highlands Development Project is a project implemented by the government of Peru and IFAD in 120 highland districts in the departments of Tacna, Cusco, Puno, Moquegua and Arequipa. The project has two phases: Southern Highlands I and Southern Highlands II.
AMUCSS AMUCSS is an organization with more than 20 years of experience in setting up, operating and supervising financial institutions and integration organizations in rural areas7. The presentation by AMUCSS began with a description of the situation in rural financial markets in Mexico. There is a low coverage of financial services, particularly savings, in rural areas, and two thirds of municipalities have no financial services. 43.7% of the people who save do so in the informal sector and only 14.7% have accounts in savings banks. Furthermore, 407 MFIs are not officially authorized to operate. The institutional model in Mexico does not work in rural areas, which are not served either by banks or by cooperatives. Only 6% of rural municipalities have access to any kind of facility, including ATMs, and financial services are concentrated in just 16% of municipalities. The challenge is to bring banking to more than 104,000 localities. AMUCSS does reach poor areas, through 90 institutions. According to an assessment carried out by AMUCSS, regulation is one of the factors making it difficult to expand the coverage of financial services in rural areas. Savings are a very important service for the rural poor, as it enables them to reduce their vulnerability, generate assets and cope with unexpected events. The seaso-
nal nature of their income means that at some times of the year even the poorest families have a cash surplus, which they may save or spend in inefficient ways. The institutions that do operate in poor rural areas have several weaknesses, including the absence of reliable information systems, deficient internal control mechanisms, weak accounting systems, poorly trained staff, governance problems, shortcomings in credit procedures and a limited range of financial products. Rural families also face a series of obstacles preventing them from saving, such as high transport costs, the need for cash, yields that are low in comparison with opportunity costs, the non-existence of a culture of precaution that would encourage saving, and distrust due to fraud and irregularities. In response to the problems affecting rural savings in Mexico, AMUCSS proposes developing networks as an effective way to promote rural savings. Networks have the advantage of generating economies of scale that reduce the costs of services. They also make it easier to capitalize institutions, thus making them stronger, reduce risk by enabling a wider geographical spread, facilitate the standardization of processes, and make access to the latest technology cheaper.
7. Ver www.amucss.org.mx
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Comments One of the interesting points emerging from CREDINKA’s experience is the importance of partnerships between public and private actors in the promotion of rural financial services, particularly with regard to savings. Indeed, the experience of the partnership between a government project and a private institution, where each of the parties played a defined role, demonstrates its potential for promoting rural financial services. The role of the public sector was also discussed from the point of view of regulation. It was clear from the discussion that regulation can be a positive factor in mobilizing savings, especially in a setting where institutions are weak and the public is distrustful, as in the case of Mexico. Nevertheless, regulation can sometimes act as an obstacle as well, if it leads to very high costs and biases in the provision of financial services
by giving priority to profitability alone. The challenge is how to arrive at a regulatory arrangement that promotes the spread of banking to poor – especially rural – areas and at the same time creates trust by reducing the asymmetries in access to information. The discussion confirmed that networks can play an extremely important role in promoting savings. Networks not only have an impact by generating the economies of scale that make it possible to reduce costs, improve the management of risks and facilitate the adoption of new technologies. They are also a powerful way to lobby the government or regulators and persuade them to design laws and regulations better suited to the promotion of financial services in rural areas.
3. P anel II Promoting Rural Savings in Cooperatives The experiences of the Mixed Cooperative “Women United” Ltd, COMIXMUL, in Honduras and the PILARH Private Financial Development Organization (PFDO) were presented in this panel.
COMIXMUL La (COMIXMUL) es una cooperativa de ahorro y crédito dCOMIXMUL is a savings and credit cooperative for women in marginal urban and rural areas of Honduras. It was founded in 1986 with 12 women members and currently has more than 27,000 members and a portfolio worth about 700 million lempiras (US$35 million). 80% of the women members live in poverty and 33% in extreme poverty. Most of them work in the informal economy, many as street vendors. COMIXMUL offers a variety of savings and credit products. The savings products include deposits, fixed-term deposits, withdrawable savings, fixed-term savings, savings accounts for children and savings for Christmas. In other words, it has a relatively wide range of savings products, bearing in mind that this is
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a relatively small organization. Taken as a whole, these products have a balance of about US$1.5 million, with average savings of 53 dollars per woman member. One of the important characteristics of the cooperative, which is highly valued by its members, is that it provides a set of non-financial services, kept separate from the financial side. Among these, the health services are particularly highly valued by members. The main constraints identified by COMIXMUL which make it difficult to mobilize savings from its members are: the distance from the women’s communities, risky productive activities, the fact that the women have to spend more time on household chores, and gender inequalities.
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PILARH OPDF PILARH works in five departments in the west of Honduras, three of which are the poorest in the country, in settings which are 95% rural and where the economy revolves mainly around coffee and retail trade. One of PILARH’s main reasons for becoming a formal institution was in order to be able to attract savings. Its product development strategy has been based on getting to know the client, diversifying products, adapting services, installing suitable IT systems, having good monitoring and control systems, and employing the most suitable staff. Based on these strategies, it has developed four savings products aimed at specific client niches and tailored to the clients’ life cycle. These products are: the baby savings account for pregnant women, which enables them to cover the costs of their baby’s first five years of life; the schoolchildren’s account, for the children of the
women members between the ages of 6 and 12 who are enrolled in school; the education account, for the children of the women members between the ages of 13 and 17 who are enrolled in school; and the “credi joven” savings account for young people, aimed at young entrepreneurs aged 18 to 30. In addition to these accounts, PILARH offers another two conventional savings products: the withdrawable savings account and the fixed-term savings account. PILARH has so far managed to mobilize a total of nearly US$2.5 million, but 97.6% of this amount is held in the conventional savings accounts. The main constraints hampering the attraction of savings are: restrictions of a legal nature (high reserve requirements), unattractive savings alternatives, the cyclical nature of income, subsistence-level income, high transaction costs and crime.
Comments These two experiences show the importance of institutional origins in the decision to attract savings. Both COMIXMUL and PILARH are institutions with roots in the community, where the vision of providing services to clients is fundamental, but always maintaining financial discipline. This is why both have thought about clients’ needs when designing a series of savings services. Nevertheless, as the case of PILARH shows, traditional products are still the ones that mobilize the most savings. These experiences also show that the
constraints hampering saving arise both from the high transaction costs caused by the long distances between communities and agency branches, and from the regulations imposing high reserve requirements that make products more expensive. Other comments focused on the non-financial services provided. Although they are highly valued by clients, they have costs that must be covered in order to avoid placing the institution’s viability at risk..
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4. P anel III Strategies for Promoting Savings in Non-Regulated Institutions Strategies for attracting savings in non-regulated institutions were presented in panel III, looking at the cases of CRECER in Bolivia and PRISMA in Peru.
CRECER CRECER is a Bolivian non-profit civil society association founded in 1985, which currently operates in nine departments. It has a portfolio valued at US$126 million, assets worth US$147 million and US$128 million in liabilities. It has 131,180 clients, 52% of whom are in rural areas and 84% of whom are women. CRECER offers financial and non-financial services. As part of its financial services it offers credit and savings under the community banking methodology. For the last four years it has also offered individual credit, and this product now accounts for 50% of its portfolio. The non-financial development services it offers are in health, education and training. The non-financial services are offered as part of the community banking methodology. In CRECER, savings are seen as a means to combat poverty, and poverty is seen as the lack of opportunities to access money, natural resources, education and services. Three types of savings are held in the community banks: starting savings, mid-term savings, and voluntary savings. Starting savings are savings deposited when a community bank starts up and are seen
as an expression of the woman member’s willingness to remain in the group. Mid-term savings are a savings scheme planned with the community bank’s management. For the first cycle, they are equivalent to 10% of the external account credit. In subsequent cycles, this rises to 20%. Voluntary savings are savings that have the objective of capitalization. The amount is capped at the value of the external account credit and the interest rate is the same as for the external account. Savings currently amount to a total of US$20 million. The savings are held in a single account for each CRECER branch and are deposited in a financial institution, but each community bank manages its own funds through the CRECER system. This system reduces the transaction costs for the women members because they do not have to travel to the financial institution. It also reduces the risks involved in transporting the money. CRECER has the objective of being able to attract savings outside the community banking arrangement. It has already carried out the relevant studies for this and hopes to obtain the licence for it by mid-2014.
PRISMA
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PRISMA Microfinance is an NGO specializing in microcredit, founded in 1994, which has taken the decision to turn itself into a savings and credit cooperative so that it can attract deposits from the public. Its vision is to become a leading microfinance institution and turn community banking into a leading product within the cooperative.
these objectives that it began the procedure to turn itself into a Rural Savings and Credit Bank two years ago, but Peru’s SBS decided not to award it a licence to operate as this type of institution. It was allowed to be licenced as an EDPYME8, instead, but this institutional arrangement would not legally allow it to hold savings. This was why it decided to become a cooperative.
It should be mentioned that PRISMA has been seeking to register as a formal institution and be authorized to hold savings for more than two years now. It was with
8. EDPYME are financial institutions supervised by the SBS in Peru that are not authorized to hold savings, only to provide credit. They were created in 1994 to make it easier for NGOs to become regulated financial institutions.
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As an NGO, PRISMA has promoted the mobilization of savings through its community banking products. Savings come from two sources: obligatory savings, which are 2% of the credit amount, and voluntary savings which are freely decided. 50% of the savings deposited are kept in an internal account and are available for loans at any time in the cycle, on the condition that the monthly interest rate does not exceed 10%. The other 50% is deposited in a financial institution; now that the cooperative has been set up, it will be deposited there. In the cooperative the plan is to start to attract savings with fixed-term deposits (following the community
bank cycles). After two years, demand deposits will be implemented. Control of the internal account in the cooperative will be carried out in the savings book, which will keep a record of the credits and interest belonging to the members of the community banks. Interest will be paid out equitably in proportion to the savings of each member of the community bank at the end of the cycle. Every member of the cooperative has to make a contribution of two soles per month. They are charged in advance for this contribution, meaning that they pay 24 soles at the start.
Comments On the one hand, the presentations show the advantages non-regulated institutions have in attracting savings through a single product – community banking – which enables poor clients to save, but on the other hand they also show the limitations that the legal structure of non-regulated institutions places on their ability to attract savings. The institutions themselves are aware of this, so much so that both of them are trying to overcome these constraints by entering the field of regulation. The community banking model creates incentives for mobilizing savings, mainly through voluntary saving.
However, as the experience of CRECER and PRISMA makes clear, it is necessary to put controls in place to prevent this account from distorting the sense of belonging to the community bank. This is why both institutions have placed limits on the interest rate and amounts. Likewise, the community banking model is highly compatible with the development of non-financial services, but the question remains as to whether this synergy between financial and non-financial services can be maintained in a regulated environment.
5. Conclusions and Challenges A consensus emerging from the presentations and discussions is that savings are a very important financial service that is highly valued by people in rural areas. Savings are important both for clients and for institutions. On the client side, savings are perhaps one of the most powerful ways to escape poverty, as they enable rural people to cope with risks, adverse climate events and the seasonality of income without decapitalizing them. Likewise, having savings is essential in order to acquire physical assets and human capital, and this is perhaps the main variable enabling people to rise out of poverty permanently. As a rule, saving should be voluntary, although arrangements such as community banks that include obligatory saving components may be important from
the financial education and learning point of view. The large-scale mobilization of savings in rural areas should be based on what local people want. From the institutions’ point of view, savings allow them to access a source of capital that is more stable and often more economic than getting into debt with public institutions, international cooperation agencies or multilateral banks. In addition, savings can generate incentives for improving governance and institutional management. Although rural savings may be small and even more costly than savings from large clients or urban savings, they can still be profitable for institutions by enabling them to have a diversified portfolio, thus reducing their
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risks and bringing greater stability to their liabilities structure. Therefore, although it is important for a financial product to be profitable, what is most important is that the savings portfolio as a whole is profitable. In other words, one savings product may be more profitable than another, but this does not mean that the institution should concentrate all savings in that product, which could be very risky for the institution. Another important point concerns the role that regulation plays in promoting savings. The workshop confirmed the recognition that regulation is important, as it makes it possible to attract savings on a large scale and creates trust, which is a key element in mobilizing savings. Nevertheless, regulation leads to costs and constraints: one of the most important costs is the reserve requirement, which in some countries is as high as 30%. Furthermore, in some countries regulation does not cover group savings, preventing or making it difficult to incorporate the savings held by community banks in some regulatory arrangements. Also on this point, it is worth mentioning that regulations differ from one country to the next. One conclusion arising from this discussion is the need to carry out a study to analyse the regulations in the region’s countries and assess the degree to which they favour or hamper the mobilization of savings in rural areas. Another related aspect is the importance of networks in mobilizing savings. Networks can have an impact
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on the mobilization of savings in various ways. One of them is by lobbying regulatory bodies or members of parliament to push for laws and regulations that are more favourable for mobilizing rural savings. Another way in which networks are valuable concerns the development or adaptation of technologies that reduce transaction costs. For a single institution with a small number of clients, technology development may be very expensive, but for a network of institutions whose total number of clients is large, it would be feasible to invest in this type of technological development. In the same way, networks enable the development of a larger number of products. Continuing with the subject of innovations, these have usually been seen from the technological point of view. However, innovation can apply to other areas that are relevant for mobilizing savings. It is therefore necessary to examine innovations in organizational and governance arrangements as well as the processes used for rural savings. Public-private partnerships appear to be a promising initiative in the area of rural finance that should be explored and developed further. Peru’s experience with such partnerships seems very promising and it would be a good idea to look at whether it would be feasible to replicate it in other countries. It is worth pointing out that these partnerships should not be limited to the public sector alone, and the possibility of including private sector actors should also be examined.