One Million Colombians Entered the Formal Financial System for the First Time in 2016

Through one means of another, nearly one million Colombians entered the formal financial system for the first time in 2016, according to the Colombian financial industry authority.

The exact number of previously “unbanked” Colombians who in 2016 established some form of ties to the sector was 999,187 people, an increase of 5.6% over the total who joined the system in 2015.

In all, per figures released this month by the Financial Superintendent of Colombia (Superfinanciera), 25.7 million adults in the country now have used at least one financial product. Of those who were added to that total last year, more than half were women and more than 70% were between the ages of 18 and 40.

Photo: The Colombian financial industry continues to include more and more people each year, with an additional 999,187 joining in 2016 to bring the total number of adults who have used at least one financial product to 25.7 million. (Credit: Jared Wade) 

At the end of 2016, the financial inclusion barometer, a metric detailed in the 2016 financial inclusion report issued jointly by Superfinanciera and the governmental Banca de las Oportunidades, stood at 77.3%, measuring the percentage of adults in the country who are involved in the Colombian financial industry. This is up from 75.4% in 2015.

Raising this number has been the objective of an ongoing campaign by public and private stakeholders alike in Colombia, where officials see improvement in this figure as a sign of both overall development and maturity for the sector.

By a vast majority, the number-one way that first-timers entered the Colombian financial industry in 2016 was by opening a savings account. Overall, 773,000 adults opened a savings account last year, which represented 77.4% of the first-time entrants.

In all, there were 1.4 million new savings accounts opened in Colombia during 2016 (including those opened by people who already had a connection to the financial sector).

While not as popular among first-timers as savings accounts, some Colombians entered the system by receiving credit. However, consumer loans, which includes credit cards, are the mostly widely used financial product overall in Colombia among all people, according to the Superfinanciera report.

At the close of 2016, some 16.4 million adults (49.4% of the adult population) carried some sort of consumer credit. Microcredit is one sub-section on the rise. Roughly three million Colombians had a current microcredit open at of the end of December.

Banco de Bogotá, the nation’s second largest bank, is one of the companies that has been leading the financial inclusion campaign. The Bogotá-based institution has been promoting financial inclusion throughout the year by driving a bus throughout the country to educate people in rural areas about its different financial products and promote everything from simple savings accounts to insurance to loans.

“Our main purpose is to bring the bank’s entire operation to the country’s rural areas, which still do not enjoy the benefits and opportunities of the financial system,” said Óscar Enrique Guzmán Guzmán, manager of financial inclusion at Banco de Bogotá. “We want to bring our services closer to farmers, coffee growers, micro-entrepreneurs, housewives, and self-employed workers to contribute to the progress of Colombians.”

The business sector is also increasing its activity in the Colombian financial industry. An additional 31,420 businesses and organizations used a financial product for the first tine in 2016, bringing the total number of enterprises with a financial product to 751,851.

The financial products with the highest penetration among the companies monitored in the Superfinanciera report correspond to current accounts (374,978 companies), savings accounts (246,212 companies) and commercial credit (22,108 companies).