Competition in the micro lending and small-and medium-sized enterprise (SME) financing sectors in Peru is stiffening because of a boom among niche non-bank financial institutions such as municipal and rural credit unions, financial holding Credicorp CFO Walter Bayly said during a conference call.
"Regulations are not an issue with non-bank financial institutions. They are competing well and have gained ground in certain niche markets because of specialisation and that means that banks need to do more to compete," Bayly said.
The banking regulator SBS recently said it is considering granting credit unions more flexibility when seeking financing. The proposed law would allow municipal credit unions and rural savings and loans the opportunity to issue bonds and other debt instruments to raise funds at a lower cost.
