The role of credit cooperatives supporting empty Spain through social capital

Abstract

The banking sector has been suffering huge transformations due to fall down of the number of credit institutions and the business’ concentration. The credit cooperatives have achieved to keep them self rather isolated of the financial turmoil thanks to the prudence investment polies and their territorial and proximity vocation with the environment. These traits, together with the cooperative character, are the main strengths of credit cooperatives. On the other hand, the growing inattention of banking sector towards territories in demographic decline, has led to the financial exclusion of their neighbors. In this context, the objective of this work is to present the credit cooperatives’ importance in Spain, deepen in provinces with lower population density. To achieve this goal, we have done a study that reveals the strong relationship between credit cooperatives and regional development. At the expense of their lowest profitability, credit cooperatives come forward to serve the needs of their environment, linking with it and integrating into its associative network, which accentuates their role in the fight against financial exclusion by means of social capital formation.