Finance

The purpose of this article is to present and discuss some of the financial industry best practices in three emerging economies: Colombia, Ecuador, and Peru. The main thesis is that, notwithstanding the importance of certain specific deficiencies, such as an inadequate regulatory context or the lack of financial education among the population, the main factor that explains the low banking levels in emerging and developing economies, affecting mostly lower-income segments, is the use of inefficient financial service distribution models. In connection with this thesis, we will try to show that traditional financial institutions, both in developing countries and in the advanced economies, have a special social responsibility to help create an efficient financial system that makes saving and borrowing instruments available to the greatest possible number of citizens.