As per Alcoforado (201), PICSO titles have been legally recognized in Brazil as of nearly ten years ago.
Barone and Sader (2008) state that the growth of microcredit with result from a reorganization of the microfinance sector, given that a need exists for an institution that would coordinate the policies applied to the varying entities operating in the PICSO sector, as well as others, that would also be capable of interacting with the realm of public policy.
This result demonstrates that the PICSO had the highest placement among the sample in terms of those indicators.
The PICSO Garantioeste displayed a zero value in the ROA and Debt indicators.
PICSOs in particular aim to promote innovation that other companies do not enact (GIDRON, 2010).
With this in mind, the following question, which guides the research here present, emerges: How do credit PICSOs in Southern Brazil perform in the economic and financial sense, and how do they rank against each other?
The choice to analyze not-for-profit organizations, namely, (PICSOs) was based in the need to identify economic and financial performance in order to attain a perspective on their economic efficiency.
The law expands on the categorization of legal entities that are privately owned, not driven by the generation of profit in this case, PICSOs. The first paragraph of Article 1 stipulates that legal entities are deemed nonprofits when they do not distribute incidental gains or profits earned in the varying operations to their members, associates, council members, directors, employees or donors, in as much as these arise from the application of their efforts toward the benefit of society on the whole (BRASIL, 1999).
(2012), PICSOs are considered legal entities of private ownership, without profit as a goal, established on February 27, 1996 by employees of a financial organization that voluntarily participated in activities promoting social wellbeing.
Herlin and Pazirandeh (201) state that PICSOs are seen as a complex matter, as on the one hand, they are not-for-profiting nature and must compete to attract donations and resources, while on the other hand, they require a great deal of outside help.
The majority of PICSOs display administrative problems, a lack of resources and a smaller clientele, inadequate for the maintenance of financial stability.
Additionally, the strategies employed to encourage the growth of PICSOs merit attention, for growing the client base stands to maintain a low rate of bankruptcy.