Guest Blogger Sergio Guzmán currently works for the Center for Financial Inclusion at ACCION International from Bogota, Colombia. He graduated from the George Washington University with majors in History and International Affairs.

A Spanish version of the following post can also be found in NextBillion en Español.

By Sergio Guzmán

Nearly 2,000 people convened at the International Symposium on Microfinance as a Tool for Peacebuilding last week in Cali, Colombia, to discuss how microcredit could be used to rebuild the social and economic fabric in post conflict areas of the country.  When it comes to financial services many of the rural municipalities in Colombia are either completely lacking (67 municipalities) or have only the most rudimentary services.  

The country's ongoing political, social and economic conflict, which has lasted over 45 years, has severely damaged the country's social tissue and broken trust between people. This makes it hard for any endeavor, microfinance included, to be successful.

Sponsored by the Alvaralice Foundation, the symposium highlighted various state projects, public-private partnerships, and private projects working on many of these issues, funded by domestic and foreign sources. A myriad of NGOs and regulated financial institutions like WWB Colombia, Finamérica, Banco Caja Social and Bancamía provide financial services to the poor.  From the director of a small NGO in conflict ridden Barrancabermeja to a Miami based NGO called Give to Colombia that channels funding for projects in Colombia from US-based companies who invest there, participants analyzed what it takes to succeed in tough conflicted areas.  International participants brought in experiences as diverse as Kosovo, Palestine, Sierra Leone and Cambodia, all with a message that microfinance can be an effective tool, because as conflict dies down people are eager to restart their lives and need financial services to help them do so.

Sometimes the connection between microfinance and peacebuilding is more implicit than explicit. Many speakers pointed out that microfinance creates economic stability which paves the way for social advancement, upward mobility and cohesion; however there are many more elements to be thrown into the mix to achieve that objective. One key is to accompany financial services with education, training and other forms of support through programs like ACCION's Diálogo de Gestiones. Guillermina Hernandez, the director of a community kitchen in a poverty and conflict-affected area said, "being part of a Microfinance Organization or Cooperative provides people with more than just financial means to better themselves, but gives them trust to become part of something in a place where people are constantly in danger, and empowers them to follow their dreams."

According to the panelists and conference-goers, Colombia needs to work on improving its regulatory framework to make it more supportive of microfinance, making it easier for international support to enter the country, promoting competition in the microfinance sector and ensuring that client protection standards are built in to the sector.

There is still a lot of work to be done. The conference provided an opportunity to reflect about the role of government, non-governmental organizations and private sector players in the construction of a peaceful society, something we all have a role and a stake in.