Many of the flaws of the bank system in Argentina trace from weaknesses in the
development banks owned by provincial governments. An important part of reform has
been their privatization. The provincial banks had a mission to serve rural areas, to
promote agriculture, to lend to those rejected by private banks, and to serve remote
towns. Rural microfinance has a similar mission except it aims not to lend to bad risks
but rather to decrease the cost to judge and to manage risk. Here, I address the concern
that privatization will strand the rural poor without financial services.