The Passport Series on Peru continues this post, with a look into the Microfinance Sector in Peru. Check out the Peru Country Profile we posted last week.
Peru is home to a thriving and interesting Microfinance sector. The industry began, formally, in the 1970's. Political turmoil and economic crisis were strong in Peru during the 1980 and 1990's. In response, women became more involved in income generating activities to cover gaps in their families incomes - thus the spread of microfinance. Continued periods of instability for the country have only made the microfinance sector stronger.
In 2010, Peru was named the best climate in the world for microfinance in the Economist Intelligence Unit’s Global Microscope on the Microfinance Business Environment. Kiva is partnered with 7 MFIs in Peru: Microfinanzas Prisma, FINCA Peru, Manuela Ramos / CrediMUJER, EDAPROSPO, Asociación Arariwa, Edpyme Alternativa, and Caja Rural Señor de Luren. Most of the loans made on Kiva are used for Retail, Services, Food Sales, or Agriculture. But in a country as diverse and thriving as Peru, the myriad of businesses reflects this.
There are currently 65 reporting MFI's on TheMix.org with $5.5 billion in loan portfolios. There are 3.1 million active borrowers with an average loan size of $1305 per borrower. The Mix also keeps detailed information on the sector, and recently released a report on Microfinance in Peru. (note: this report is in Spanish!)
Next time you make a Kiva loan, think about lending to a Peruvian entrepreneur!
Photo Credit: Neda Amid-Hozour
Photo Credit: Neda Amid-Hozour 