Maria José Murillo, responsible for supply chains in the Alliance for Responsible Mining (ARM)

(Second and last blog of the series)

“The opinions expressed in this publication are exclusively from the authors and do not necessarily reflect the point of view of the Alliance for Responsible Mining, its Board of Directors, or its technical team.”

Why do banks deny services to artisanal miners?

The most common reasons that banks deny services to the gold mining sector, are related to the difficulty of carrying out due diligence processes that allow them to perform an accurate risk assessment. Are these reasons really objective when the inability to do proper risk management by the compliance area rests with the evaluated actor?

Thus, it all comes down to a cost/benefit analysis of the commercial relationship with the mining sector: how attractive the stakeholder is versus the risk it represents. It is important to keep in mind that many of the people who perform these analyzes are not experts in mining issues and receive information about the sector from what they see in the media and what they hear from their peers.

This creates prejudices in bank officials that are later deepened by:

  • difficulties in understanding the information that the mine provides;
  • lack of access to reliable and updated information necessary to verify and expand the information provided by the miner;
  • weaknesses in the financial management of the mine.

The controls and mechanisms used to assess the sector’s risks raise the costs and level of effort put into linking and managing a mining client. They also fail to adequately mitigate the risks and do not compensate the benefit perceived by the bank to get involved with the stakeholder.

An attractive client for a bank is a client with good income, with healthy administration and good liquidity or possession of capital and investment assets that can guarantee good financial management, in addition to credibility in all accounting information and suppliers/customers with whom the company interacts.

According to the above, miners that work in small-scale mining can present different gaps with this profile:

  • In the first place, the commercialization of precious metals generates good income but these are already dedicated to expenses in the operation so, as soon as incomes are received, they leave the account, without leaving significant disposable deposits for the bank.
  • The capital goods of miners, such as machinery, equipment, mining rights or reserves, do not constitute attractive guarantees for the bank due to the complexity of their management and responsibilities.
  • Thirdly, as many SMEs have difficulties with financial and accounting management, many of the small-scale mining companies are made up of vocational miners with little training and professionalization in administrative, accounting, and financial matters.
  • Finally, at the supplier level, they operate in contexts in which informality is high and represents difficulties in the correct justification of all their operating costs and expenses and, at the client level, the bank does not know who can be considered as reliable actors. Additionally, the gold supply chain can become long and complex, making it difficult to analyze and evaluate.

Lack of knowledge and barriers

Given this scenario, banks have taken actions detrimental to the development of the mining sector: from sharp policies that exclude any stakeholders related to the mining and marketing of gold, to severely demanding and exhausting practices for those who approach making a request.

The first barrier that a miner must overcome when making a request from a bank is that the clerk handles the transaction. As previously mentioned, once the official knows your economic activity, they can take two actions 1. Directly say that the bank does not work with miners, or 2. Present a list of documents required for customer analysis that reflects the bank’s poor understanding of the mining sector by requesting non-existent, redundant or inconsistent documentation.

However, let’s suppose that the miner manages to present all of the requested documentation — again the bank reacts unfortunately: 1. Extensive response times; the miner must contact the bank again and again in order to receive a response to the request; 2. The bank requests complex additional information to obtain such as data from its buyers abroad, or 3; Verbally denies the request without submitting in writing the objective causes of the decision.

While this is happening, several months may pass before the miner knows if the requested service will be performed, causing serious inconveniences such as difficulties in payroll payment, freezing of commercial relations with potential clients abroad, and delays in their financial commitments.

The lack of official and written responses that present an objective cause are a common factor, which can be solved by submitting petition rights. However, here the miners suffer more negligence from the banks since they sometimes refuse to receive the petition rights. As for the complaints to the Superfinancial, these are infrequent due to the miner’s lack of knowledge about their rights and, if they are made, they usually end supporting the bank’s decision.

It is difficult for banks to understand what entities are legally carrying out activities in the Colombian gold sector. I have seen first-hand mining organizations that fully comply with mining regularization and formalization processes (with international certifications that attest to their good environmental and social practices) be denied service for several months.

Due to the information gaps between the sector’s leading entities (such as DIAN and ANM in Colombia), and the inconsistencies present in the information they have submitted for export, the reliability of the information that the Colombian state provides is considered as low.


  • The finance sector’s worry in relation to the mining sector is legitimate, since it is a complex and high-risk sector. However, the tendency to deny miners’ access to financial services in an almost generalized manner constitutes an unconstitutional practice undermining the development of the sector.
  • The sector’s negative image promoted by mass media makes the success stories and the good practices that implement those that accept the formalization processes invisible.


  • Propose the entry of The Ministry of Mines and Energy as an active member of the intersectoral commission for financial inclusion, created by Decree 2338 in 2015.
  • Articulate an agreement that expresses the formal commitment between the Ministry of Mines and Energy and the Ministry of Finance to work jointly towards forming activities that guarantee the financial inclusion of artisanal and small-scale mining (ASM).
  • Articulation between the Department of Formalization of the Ministry of Mines and Energy and rural financial inclusion initiatives such as USAID’s, SME inclusion initiatives such as the Alliance for Financial Inclusion, or the National Government program administered by Bancoldex, Banca de las Oportunidades.
  • Create sources of information articulated between the National Mining Agency (ANM), DIAN, Comptroller (Contraloría), and other leading entities that have an impact within the mining sector that allow and facilitate due diligence processes.
  • Promote spaces for understanding and training within the financial sector with respect to the mining sector and the commercialization of precious minerals.
  • Work on the financial education of ASM miners in order to support their formalization processes, ensuring protection and education for the financial consumer.
  • Identify two or three banks with a strong rural presence that could work towards ASM banking in an articulate way by designing useful and affordable financial products that meet the needs of the miners in terms of transactions, payments, savings, credit and insurance, provided in a responsible and sustainable way.
  • Strengthen the capacities of the ANM and the MinEnergy so that, together, they can better promote and monitor the mining sector and thus improve the credibility of their processes abroad.
  • Promoting shorter supply chains can help to make the information more transparent and facilitate its control and traceability. Helping miners make direct exports to the international market by including them in export promotion policies would be beneficial.




Maria José Murillo is an International Business Professional from la Universidad del Tolima y Magister in Social Responsibility and Sustainability from la Universidad Externado de Colombia. During her time as a professional, she has focused on topics related with the commercialization, formalization, and exportation of artisanal and small scale mining in different Latin American countries. She has worked with the ASM sector for 4 years.

Currently she is responsible for the Alliance for Responsible Mining’s supply chain and is a member of the Foundation’s Board of Directors.

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