Original Partner Description

The Rural Credit and Savings Bank of Señor de Luren began its operations on May 23, 1994 in the city of Ica in southern Peru, with the mission of promoting the development of the agricultural sector through lending. In 2003, they began diversifying into other economic sectors, introducing new lending products such as microenterprise, consumer and home loans. They have recently experienced significant growth and by the end of 2008 had a network of over 45,000 borrowers, a loan portfolio valued at approximately $108 million USD, and 32 offices throughout the country. Caja Luren provides three major products to its clients:

• Microcredit
• Micro savings
• Micro insurance

Ever since the infrastructure in Ica was largely destroyed and the economy deeply weakened by a devastating earthquake in 2007, Caja Luren has found itself uniquely positioned to serve an area of great economic need as residents seek to rebuild their lives, homes and economic livelihoods. After the earthquake hit, Caja Luren provided 6-month grace periods to a large portion of their affected portfolio. Virtually all of these restructured clients have repaid their loans on time and appear to be on their way to full recovery.

As part of an effort to reduce institutional operating expenses, Caja Luren began a partnership with Peru’s National Bank to share offices with the bank. This helped expand access to some of the more inaccessible regions of Peru by significantly lowering the operational cost of working in these rural areas. This partnership has grown to the point where more than half of Caja Luren’s 32 offices throughout the country are now shared under this agreement.

Caja Luren is a regulated institution and reports monthly to the Peruvian Superintendent of Banks (SBS). They adhere to SBS standards for financial reporting and receive auditors from the SBS annually. They have also developed a well-established internal risk management function that includes a risk management department and an internal audit department with detailed process and procedural manuals.

Caja Luren is using Kiva funding to expand its lending operations to support new microentrepreneur clients and residents whose homes were destroyed in the devastating earthquake in 2007. They will focus primarily on providing capital to encourage business growth and housing repair and construction in the rural areas within the Ica province. In order to bolster the prosperity of the businesses and livelihoods of these clients, all Kiva borrowers will be receiving a lower fixed interest rate than other Caja Luren borrowers.

Learn more:
• Join the Amigos de Caja Rural Señor de Luren lending team
• Read about Caja Rural Señor de Luren on the Kiva Fellows blog