Teaching entrepreneurship: Venezuela’s BOD backs micro-business funding

More than 20,000 micro-business owners have graduated from Banco Occidental de Descuento's entrepreneurship schools this year, says bank president Victor Vargas

August 24, 2015

Victor Vargas is one of Venezuela’s top entrepreneurs: president of BOD and numerous other Latin American banks, he is leading the charge in supporting micro-businesses in the country. He describes the micro-business landscape in Venezuela, how Venezuelan banks do things differently, and how he hopes his children inherit his values.

World Finance: Victor Vargas is one of Venezuela’s top entrepreneurs: president of BoD and numerous other Latin American banks, he is leading the charge in supporting micro-businesses in the country. He joins me now.

Victor, what are you doing to help micro-entrepreneurs to start up their businesses in Venezuela?

Victor Vargas: Probably one of my important concerns in my life is my country.

Venezuela probably needs now more than ever our help. I mean the people, normally: they do business in the street. You know? They put up a small sign, and maybe sell some kind of merchandise.

These people are victims of the people that give financial possibility to do their business. We try to work with them. We have now five different schools in Venezuela. And if you are these kinds of people, and you have interest in trying to be a small entrepreneur, a micro entrepreneur: you can go to these schools, you can study for three months, and you can graduate yourself into an entrepreneur. Because when you finish your course with success, immediately the bank will give you credit in order to start your business.

And this year we have had 20,000 people graduated from these schools. And our goal is to double this figure for 2016.

You know, for me, this is my project. I love this project, I love these people – because you see the reactions of the people when they look back and say, ‘I was there, less than six months ago! I now have my small business!’ And when I talk to everyone about this, I say, ‘This is not for now; this is for the rest of your life. Probably, this business will be there for your kids, and you’re doing something for your family.’

This is very important: the value of this project is amazing for us.

World Finance: Tell me about BoD – how did you grow the bank?

Victor Vargas: BoD started something like 58 years in Zulia state. Our goal at that time was to try to grow the bank into the top five banks in the country. That was a success: now we are number four, number three. And we are very happy with our success.

Today, BoD has around six million different customers. And of these six million customers, 4.8 million are doing transactions every day.

World Finance: How did you attract such a strong customer base? How do you set BoD apart from your competitors?

Victor Vargas: All the banks are very good banks. If you have a bank and you say, ‘My bank is better than your bank!’ – that’s not true.

All the banks have exactly the same services. Our goal in this is to do things differently. And we speak directly the client.

In Venezuela, people like to speak with their banker. They feel they’re part of the family. They speak like, ‘I want to speak with my assessor! Give me some kind of advice in order to use my money.’ They can call and say ‘What happened with me,’ or, ‘Can you see me this afternoon? I would like to speak with you.’

Now, we have four thousand people in service of our customers. They’re executives. And normally they attend directly: person to person with people. And you can speak with them through the web, you can speak through WhatsApp, or Blackberry, or something like that.

Our goal is: you call, you have an answer. You can all the time speak with your financial assessor. That’s what works in Venezuela.

World Finance: As well as your commitment to supporting Venezuelan business owners, you’ve invested heavily in culture and the arts – why is this so important to you?

Victor Vargas: The opportunities in Venezuela to develop culture and education are few. It’s not like Spain or the US. The level in Venezuela in this area is not the best level you can do. You know, I mean, probably, in my condition, if you have the possibility with 4,000 direct employees in Venezuela: you need to do something for these people.

We operate the most important culture centre in Venezuela: in Spanish it’s the Centro Cultural BoD. It’s very active in culture, in different kinds of areas; in the arts, theatre and music.

Our expectation is to be ready in 2017 with four different cultural centres in Venezuela. And we would be very proud of that, you know? It’s important, it’s necessary, and it’s our commitment. For me it’s compromise with my country and my people.

World Finance: Your country is clearly extremely important to you, but I also know your family is a large part of your life. Are you trying to pass on these same values of helping others to your children?

This is a very smart question. You know… probably? My expectations would be that my kids do exactly what I’m doing right now! But you never know! I have two young kids, from my second marriage. We try to give to our kids a very good education, a clear concept about family – that’s important for us, because everything is coming from the family. If you have a very good formation in your family, you’re going to be a very good citizen in your country, you know?

World Finance: Victor, thank you.

Victor Vargas: Thank you so much.