The Non-Traditional Financial Sector in Nicaragua: A Response to Rural Credit Market Exclusion.

The article focuses on the non-traditional financial sector and the rural credit market exclusion in Nicaragua. After 1990, the early and sharp contraction of state credit in Nicaragua along the lines required by structural adjustment and stabilization reforms left the majority of rural producers, small and medium-scale farmers, without access to producer credit. A non-traditional financial sector (NTFS) that operated through non-governmental organizations (NGOs) and consisting of several forms of credit unions and co-operatives expanded alongside the private commercial banking sector after 1990. It is reported that NTFS institutions had overcome early problems in credit delivery and recovery by tightening operational procedures in most cases.