Microfinanzas Puerto Rico gets federal certification
Microfinanzas Puerto Rico President Annette Montoto said Wednesday that the microfinancing firm has been reorganizing its structure as of late — striking new strategic partnerships and reinforcing its services — to more effective cater to its entrepreneurs client base.
“The microfinance to which we belong, in addition to providing entities with procedures, technology, etc., allows us to share experiences, best practices and strategies to continue to deliver good products and services tempered to the needs of our customers,” said Montoto. “Contrary to pawn shops or financial companies, Microfinanzas Puerto Rico is based on productive finances, meaning that loans are evaluated and are exclusively linked to productive activities.”
Microfinanzas Puerto Rico is a company that describes itself as a financial expert on microcredit methodologies, offering its customers financial tools to support their businesses and personal finances. The company’s loans range from $500 to $15,000, depending on the applicant’s repayment capacity and needs to grow their productive business. Loans are granted for defined productive activities, such as the purchase of certain equipment or inventory.
This week, Microfinanzas Puerto Rico became the first social enterprise on the island to be certified as a Community Development Financial Institution, after meeting all of the standards and requirements set by the U.S. Treasury Department to provide loans and credit to low-income communities.
“In Puerto Rico there are only six nonprofit organizations that have this certification. Microfinanzas Puerto Rico has become the seventh and the first social enterprise organization dedicated exclusively to microfinance to obtain this certification, which had not been granted on the island since 2009,” Montoto said.
The CDFI Fund was created in 1994 for the purpose of promoting economic revitalization and community development through investment in and assistance to community development financial institutions, according to the program’s website.
As part of the CDFI network, Microfinanzas Puerto Rico can establish strategic alliances and agreements with traditional banking and other types of financial institutions, Montoto explained.
“This certification promotes, among other things, that banks work with certified microfinance institutions, such as us, to direct funds and efforts in low-income communities since they are usually considered and well regarded by federal regulators,” she noted.
The CDFI certification is one of several actions the local entity has pursued to strengthen its core, she said. Recently, the local staff received training from Banco de Ahorro y Crédito ADOPEM in the Dominican Republic. ADOPEM and Microfinanzas de Puerto Rico are part of the BBVA Microfinance Foundation, which has network of eight microfinance institutions in seven countries in Latin America, currently supporting 1.5 million people, representing a social impact more than 6.4 million people.