At a height of 14,000 ft, up in the Andes, lies a thriving economy — La Paz, the capital of Bolivia. During a recent visit, I stopped by El Alto, a neighboring city that hosts the country’s largest outdoor market. El Alto sits at an even higher elevation than La Paz. To reach it, I took Mi Teleferico, the aerial cable car system that serves as affordable public transport for the state’s 2.7 million residents.
From a public infrastructure perspective, Mi Teleferico is a monumental achievement. In 2014, upon completion, the system was the longest aerial cable car system in the world. Bolivia is also the first country to use a cable car system as the backbone of a mass-transit system. For its innovation in addressing a growing public transportation crisis, Mi Teleferico won a Latam Smart City Award in 2018.
While Bolivia is driving innovation in public transport and sustainability, it has lagged in other areas — particularly financial services. Significant regulation has made innovation difficult, especially in serving Bolivia’s informal small businesses sector, which employs over half of the population. The country also has the lowest GDP per capita in Latin America, and it’s the second-lowest in South America on the Human Development Index. In this environment, small businesses can’t access the tools they need to grow.
Serving Bolivia’s small businesses
Banco Solidario S.A (BancoSol), the first regulated commercial bank in the world dedicated to serving micro and small entrepreneurs, is headquartered in La Paz. The bank serves more than 1.5 million clients nationwide. Most of these clients operate in the informal economy, and nearly half are women. Accion has been supporting BancoSol, as a shareholder and advisor, since its original transformation into a commercially driven microfinance bank.