Why Latin America Requires Different Credit Models
Access to credit for small and medium-sized enterprises in Latin America remains structurally constrained. This is often attributed to elevated risk, macroeconomic volatility, or weak documentation standards. However, these explanations overlook a more fundamental issue.The region’s economic structure differs materially from that of highly formalized economies where most contemporary credit models were originally designed. Informality, uneven bureau depth, liquidity volatility, and accelerating digital payment adoption create a distinct operating environment. When underwriting frameworks built for mature, fully formalized markets are applied without structural adaptation, they tend to misinterpret ambiguity as risk.
February 27, 2026
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