• What is microfinance?
“Microfinance” is often defined as financial services for poor and low-income clients. In practice, the term is often used more narrowly to refer to loans and other services from providers that identify themselves as “microfinance institutions” (MFIs). These institutions commonly tend to use new methods developed over the last 30 years to deliver very small loans to unsalaried borrowers, taking little or no collateral. These methods include group lending and liability, pre-loan savings requirements, gradually increasing loan sizes, and an implicit guarantee of ready access to future loans if present loans are repaid fully and promptly.

More broadly, microfinance refers to a movement that envisions a world in which low-income households have permanent access to a range of high quality financial services to finance their income-producing activities, build assets, stabilize consumption, and protect against risks. These services are not limited to credit, but include savings, insurance, and money transfers.
  • What are the financial services of PEACE MFI?
PEACE MFI provides Savings and Loans services.  
PEACE MFI mobilizes four types of savings:
  • voluntary savings, 
  • regular savings,
  • Mandatory savings, and 
  • Institutional savings.
Voluntary saving can be withdrawn any time. Clients are required to regularly save with PEACE usually once a month but they have full right to decide on the amount of these regular deposits. Regular savings are not withdrawn as clients are required to remain regular savers so that they can permanently access services from the company. Mandatory savings represent a 10% upfront contribution from their own resources as collateral. Institutional saving is the savings of community based institutions. 

PEACE MFI provides two major categories of loans: agricultural loans and non-agricultural loans. Non-agricultural loans are provided for clients engaged in petty trade, local beverage production, artesian, hairdressing and barber, transport services using carts, etc. Agricultural loans are provided for goat and sheep rearing, purchase of oxen, fattening, purchase of select seed, fertilizers, dairy cow, etc. 

  • Is there any non-financial service that PEACE MFI provides?
PEACE MFI provides non-financial services such as Business Training, Marketing Advice and Consultation.

  • Does PEACE pay interest on saving deposits?
Yes. PEACE MFI pays 5% interest on all types of savings.
  • How do savings services help poor people? 
PEACE MFI is a saving-led institution. It gives prior emphasis for saving mobilization. Saving can help clients in the sense that they can withdraw it when a need for cash arises at the time of emergency. 
  • What is the target group of PEACE MFI?
The target clients of PEACE MFI in general are the productive poor who are willing, capable and ready to engage in productive economic activities. The target population can be categorized as follows:
    • The active poor, particularly women, who are willing to organize themselves into groups that will demonstrate a commitment and joint accountability for full repayment of loans.  
    • Those micro entrepreneurs who own business that would not be harmful to social and moral values of the community and environment.
    • Those individuals who are already engaged in micro or small enterprises that are production/service oriented and are feasible activities. Individuals could be those clients of the MFI who have been borrowing as group members but have now outgrown the group lending system and wish to borrow larger amounts of loan individually by providing alternative collateral.
    • Those cooperatives who are organized around agriculture or other business sectors and who have legal status.
    • The general public who are usually considered to have high potential for mobilizing voluntary saving deposits.
  • Where are the operational areas of PEACE MFI
PEACE MFI operates both in urban and rural Ethiopia. It provides services through a network of 16 branches in Amhara (five branches), Oromia (nine Branches) and South Nations, Nationalities and people (two Branches). 
  • How can I access PEACE financial services?  
Potential clients who are eligible to access services from PEACE MFI:
  1. are members of a formally established solidarity group.
  2. have no outstanding loans from other MFIs as evidenced from information obtained from other MFIs.
  3. own businesses that have been operating for at least 6 months.                                                   
  4. demonstrate willingness and commitment to co-guarantee other members’ loans.
  5. are willing to regularly save.
  6. do not have record of misconduct and misbehavior such as theft, robbery, embezzlement, fraud, etc. as evidenced by letter of support from their Kebele,
  7. are Permanent residents within operation area of PEACE MFI and have stable family situations or connection as verified by letter of support from their Kebele.
  8. are not involved in the production, distribution and sales of charcoal, gambling, money lending, and the like that are considered ineligible business for PEACE. 
On the other hand, existing clients, who have been in group lending system for a long period of time and graduated for larger loan size, who are willing and able to pledge assets evidenced by original certificate of ownership or any legal evidence of ownership, can access the financial services of PEACE MFI. 

  • Can cooperatives access financial services of PEACE MFI?

YES. Existing cooperatives and saving and credit groups and community based organizations (CBOs) organized by Agri Service Ethiopia or other organizations who have good portfolio performance and proved to be in coherence with PEACE eligibility criterion can access PEACE services by entering into agreement with the Institution  without reorganizing  themselves into group. 
  • Is there age limitation to access the financial services of PEACE MFI? 
The age a potential client needs to be within a range of 18 to 55 years.  However, an exception could be for the upper limit for an individual who is proved to be healthy, productive and capable to actively engage in productive business. 
  • What is the interest rate of PEACE MFI lending? 
    • Annual interest rate of 15% will be charged on flat interest rate calculation method for non-agricultural loan in both group and individual lending.
    • Annual Interest rate of 18% will be charged on flat interest rate calculation method for agricultural loan in both group and individual lending.


Partners & Linked Organizations

Agriservice Ethiopia


Women's World Banking


Microfinance Information Exchange

Planet Rating 

Micro Finance African Institution Network (MAIN)


Association of Ethiopia Microfinance Institution



PEACE Achievements

PEACE has achieved a competitive position in the Ethiopia MF sector through a focus strategy that targets rural low income women.  It has experienced significant growth during the past years and the market still has a high level of unmet demand.