Factors imposing conditions to the development and growth of cooperative savings and loan societies in Mexico

Abstract

The Savings and Loan Cooperative Societies (SOCAP) have been a response to the problem of financial inclusion in the country for more than 65 years, as they have tried to break the circles of poverty that have arisen over several generations in Mexico. Despite this, these companies have not met the expectations of the partners, government authorities or national and international organizations. This is because the evolution of the sector has not created the economic and technical conditions to grow and consolidate as true financial institutions. These types of companies, in many cases, have been affected by legal, organizational and performance factors, which have limited their consolidation and forced them to operate at the basic level, without being regulated by the National Banking and Securities Commission, putting members’ deposits at risk and creating problems of fraud and possible bankruptcies