In the past several years, there has been increasing interest in the use of microcredit as a tool for
improving the lives of the poor. The underlying idea is to support the business enterprises of the
world’s low-income and small-scale entrepreneurs by providing them with access to loans on
reasonable terms. As one of the fastest growing economies in Latin America, Peru has the world’s best
business and policy environment for microfinance. However, little has been done to quantify the
impact of microfinance on profitability and revenues of informal small and medium-sized enterprises.
This paper reports on the findings of a survey conducted in two urban cities in Peru by the World
Bank’s Informal Enterprise Survey (IFS), and reflects on the potential benefits of microfinance as a
source of not only anti-poverty development finance, but also as a key driver of sales.