A Proposed Credit Risk Assessment for People at the Bottom of the Social Pyramid in Cali, Colombia

Juan David Rivera Acevedo, Lina Martínez

Abstract


The informal economy accounts for half of the economic activity in Colombia. Street vending is a major part of the informal sector. In the context of a rapid urbanization due to internal conflicts, low skilled workers find a last resort for income generation as street vendors. Even though studies have revealed that street vendors can have high profits, they usually remain poor. A primary reason is their continuous indebtedness outside the regulated financial market. This paper proposes a comprehensive questionnaire survey on the socioeconomic profile of street vendors. This tool can be used to assess the individual credit risk and incentivize the financial inclusion of the poor. It can also be used for evaluation processes by the government or impact investors.


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DOI: https://doi.org/10.5539/res.v10n3p41

Copyright (c) 2018 Juan David Rivera Acevedo, Lina Martínez

License URL: http://creativecommons.org/licenses/by/4.0

Review of European Studies   ISSN 1918-7173 (Print)   ISSN 1918-7181 (Online)

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