In Mexico, the financing gap for formal small and medium-sized enterprises (SMEs) is estimated to be $163.9bn, more than six times the supply of credit for the segment. As of September 2021, credit to SMEs made up only 9.4% of total private sector credit in the country, with large enterprises’ share amounting to 43%, according to central bank data.
“Historically, there has been a lack of desire from the banks to go after clients that are perceived to be higher-risk, combined with the lack of the tools to properly service them,” explains David Poritz, co-CEO of Covalto, a Mexican digital banking and services platform.
