El Salvador seeks to offer low-interest Bitcoin-backed loans to SMEs

2 years ago 134

Latin American country El Salvador is leaving no stone unturned to incorporate Bitcoin into its present-day financial system. The country is now looking to offer low-interest Bitcoin-backed loans to small and micro businesses as it looks to further leverage its use.

While details of the new initiative are yet to be revealed, Mónica Taher, director of technology, economics, and international affairs of the El Salvador government, said in a Facebook Live Audio conversation that El Salvador’s next Bitcoin agenda is offering “bitcoin-denominated loans with lower interest rates than banks.

In an interview with crypto media Cointelegraph, Taher said:

“The Bitcoin small loans will provide access to digital money for the unbanked while helping them create a credit history. El Salvador’s economy will strengthen by empowering its small businesses.”

Comienza la transmisión de #PlanetaCrypto en la Sala de Audio de Facebook YA.

Préstamos en #Bitcoin con menor tasa de interés que lo que los bancos te ofrecen.

Aquí: https://t.co/5H94J1xHzz pic.twitter.com/3PLKbulHcO

— Mónica Taher (@monicataher) January 20, 2022

Paul Steiner, president of CONAMYPE (the national institute for small and micro-businesses) noted that while El Salvador has roughly 1.2 million businesses in the country, many of them remain unbanked. Against this background, the country can reduce the unbanked class by offering low-interest Bitcoin loans.

In addition, loans will be provided via El Salvador’s official Bitcoin wallet, Chivo. As of now, more than 60% of the country’s population uses the Chivo wallet, according to the country’s president Nayib Bukele.

4 million users!

*Total population: 6.5 million (including people under 18 that are still not allowed to use the app).

We have the receipts#BTC https://t.co/y3jvEdOtex