Viabilidad institucional : condicion de exito de los programas de microempresa

It argues that private voluntary organizations with the correct development approach are better suited than government agencies to reach microenterprises. What is needed are financially viable NGO"s. Viability depends, in turn, on the ability to protect the real value of the portfolio from inflation, from default, and from operational losses. Viability depends on quality services and low transaction costs, as well. NGO"s that behave as if they were depositor-dominated, even if they do not mobilize deposits, are more successful. Success is also based on specialization in financial intermediation, flexible interest rate policies, and portfolio diversification. In four programs evaluated (Latin America), the financial viability of the NGO"s was strongly correlated with positive impacts for the beneficiaries. The last unresolved issue is the burden of the foreign exchange risk, in countries where the real exchange rate is being depreciated (i.e., devaluation is faster than domestic inflation). (Author abstract)