The Impacts of Microcredit: A Case Study from Peru

The aim of this paper is to carry out an impact assessment study on clients from Mibanco, Peru, at three different levels: microenterprise, household and individual. The paper indicates that:

• At microenterprise level, microcredit may have had positive impacts on microenterprises in terms of revenue, fixed assets, employment and transaction relationships;
• At household level, many welfare variables, such as expenditures on housing improvements, household appliances and food, may reduce significantly;
• At individual level, the impact of credit may result in increased feelings of preparedness for the future, but similarly in decreases of client self-esteem.

The paper concludes that:

• Female entrepreneurs tend to exercise more control over household and enterprise resources and also appear to save more consistently than male entrepreneurs;
• Low-income households that have sound financial management practices can benefit from a well-developed microfinance industry;
• Households receiving microcredit are better off than their non-client counterparts, and that some of these benefits can be attributed to their participation in the microcredit program.