The encyclopedia · Finance & Accounting · Strategic decision · 1990–1998
Mibanco turned Peru's ACP microcredit NGO into a full-service bank
Peru's ACP microcredit program became Mibanco in 1998, the country's first full-service microfinance bank — research found outreach to the poor improved.
Mibanco · Acción Comunitaria del Perú (ACP)
The solution
Acción Comunitaria del Perú (ACP) started as an NGO working on community development and built a microcredit program that grew rapidly from 1990 to 1998. The growth forced a strategic question: which legal form should the operation take next?
The team planned the transformation and evaluated options such as a Financiera and an EDPYME (small-enterprise development entity), then formed Mibanco in 1998 — Peru's first full-service microfinance bank — through a structural, financial and operational transformation.
As a bank, Mibanco diversified its sources of funds, increased its reliance on deposits, and tapped capital markets through a bond issue in 2002. The 2001 case study found the clientele entering after transformation were poorer than before, with higher transaction costs from more paperwork but loan terms better suited to the poor.
Both studies conclude that commercialization does not necessarily lead to mission drift: the transformation facilitated outreach to the poor and ensured long-term sustainability, and ADB offered the case as a source of lessons for Asian microfinance institutions.
Why it worked
- Deposits gave a stable, low-cost funding base that grants could not match.
- Capital-market access through the 2002 bond issue added long-term money.
- A regulated bank charter built credibility with savers and investors.
- The lending methodology carried over, keeping products aimed at poorer clients.
What can be applied
When an NGO outgrows its legal form, converting to a regulated bank unlocks deposits and bond finance — and commercialization need not dilute the mission if the lending methodology carries over.
Aftermath
By 2003, ADB researcher Nimal Fernando was publishing Mibanco as a case of profitable microfinance outreach, with lessons aimed at Asian institutions that focus on rural clients. The documented findings — outreach to the poor facilitated, long-term sustainability ensured, and no mission drift — became part of the evidence base that commercialization could strengthen, rather than undermine, a social lender.
Sources
- The Transformation of Accion Communitaria del Peru (ACP) to Mibanco
- Mibanco, Peru: Profitable Microfinance Outreach, with Lessons for Asia
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