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Microcredit: Role of Entrepreneurial Ventures in Development of Cabo Verde

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Abstract

Microcredit provides small loans to the most deprived populations for whom credit is difficult to obtain from the traditional banking system. These microcredits have no collateral backing and work on the basis of a small group-based borrowing mechanism. The funds are often used for financing productive and educational purposes related to entrepreneurial activities and self-employment. For this reason, microcredit is pointed out as a valuable tool in the economic, social and cultural development of poor countries.

The study analysed the application of the microcredit programs in Cabo Verde and their implications for poverty reduction, income generation, self-employment and equality of gender promotion. The results showed that microcredit is an important financial instrument for poverty alleviation and the improvement of family income in Cabo Verde. The majority of the projects were based on women initiatives and oriented to the creation of micro and small businesses that provide self-employment and jobs for poor people, allowing families to have access to income sources that otherwise they would not have. The revenues generated gave individuals the opportunities to acquire goods and services that improve their quality of life and wellbeing. This is particularly important in Cabo Verde since the welfare state is practically non-existent there.

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Correspondence to Susana Bernardino .

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Bernardino, S., Freitas Santos, J., Vicente, Z. (2018). Microcredit: Role of Entrepreneurial Ventures in Development of Cabo Verde. In: Carvalho, L., Rego, C., Lucas, M., Sánchez-Hernández, M., Noronha, A. (eds) Entrepreneurship and Structural Change in Dynamic Territories. Studies on Entrepreneurship, Structural Change and Industrial Dynamics. Springer, Cham. https://doi.org/10.1007/978-3-319-76400-9_13

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