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Crediamigo: partnering with Vivacred?

Frédéric Lavoie (HEC Montréal, Montreal, Canada)
Emmanuel Raufflet (HEC Montréal, Montreal, Canada)

Publication date: 17 October 2012

Abstract

Subject area

The case is suitable for undergraduate and MBA courses: strategic management, social entrepreneurship.

Study level/applicability

Masters, Bachelors.

Case overview

In Fortaleza, January 2008, an urban microfinance manager and the planning committee of Crediamigo, Brazil's largest microfinance institution need to devise an entry strategy to Rio de Janeiro's microfinance market. A part of the Banco do Nordeste, and a regional development bank for ten years, Crediamigo has 400,000 clients in the Northeast of Brazil. Its objective is to double its clients base for 2011; Rio de Janeiro's market was the next priority. Crediamigo has two options. The first consists of partnering with VivaCred, a small experienced microcredit non-governmental organization (NGO) which operates in Rio de Janeiro's slums. VivaCred was a microfinance NGO with relatively low organizational capabilities and with a low performance in terms of loan repayment. Its lending methodologies were different from Crediamigo's experience. The second option was to set up a new branch of Crediamigo in Rio and to shape it in Crediamigo's image. The committee was aware that this, “far away from home”, would be a costly and slow venture.

Expected learning outcomes

After using this case, students will: have been exposed to the strategic, managerial and operational challenges of microfinance expansion in an emerging country; understand better the market entry strategy (acquisition/integration of an organization vs green field) in such a context; have discussed the conditions related to the replication of microcredit methodologies (individual, group and village lending methodologies) in their contexts of operations.

Supplementary materials

Teaching notes are available for educators only. Please contact your library to gain login details or email support@emeraldinsight.com to request teaching notes.

Keywords

Acknowledgements

The authors would like to acknowledge the support of Crediamigo staff and management. The version submitted here was read and revised by Crediamigo. The case was revised by Banco do Nordeste.

The opinions presented in this case may not reflect the Bank's institutional position.

Citation

Lavoie, F. and Raufflet, E. (2012), "Crediamigo: partnering with Vivacred?", , Vol. 2 No. 8. https://doi.org/10.1108/20450621211317618

Publisher

:

Emerald Group Publishing Limited

Copyright © 2012, Emerald Group Publishing Limited

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