Credo Bank

Back to Atlas

Credo Bank is a prominent financial institution in Georgia, known for supporting micro, small, and medium-sized enterprises (MSMEs) with accessible financial services to underserved populations.
What are the main aims and objectives?

Credo Bank primarily aims to support the economic development of Georgia by focusing on micro, small, and medium-sized enterprises (MSMEs). Its objectives include providing accessible financial services to underserved populations, particularly in rural areas, to stimulate local economies. The bank is committed to empowering women entrepreneurs, enhancing financial inclusion, and fostering sustainable business practices. By leveraging its extensive branch network and digital infrastructure, Credo Bank seeks to offer tailored financial solutions that meet the diverse needs of its customers. Additionally, the bank is driven by its vision "to enable the poor to increase household incomes and reduce their vulnerability, enabling them to build a meaningful, sustainable, and self-determined livelihood.”

How does the program work?

Credo Bank provides a variety of SME loan products tailored to meet the specific needs of its customers. Typically, the average loan amount is 1,519 Georgian Lari (approximately US$586), with an average loan term of two years. These loan products are designed to be flexible, offering adjustable interest rates, grace periods, and terms. This flexibility is intended to effectively serve customers who are hard-to-reach or have traditionally been unbanked.

Credo Bank employs a comprehensive approach to assess potential clients' creditworthiness. This process involves utilizing credit bureau services for formal credit checks, while also engaging with local village councils to gather additional insights. Simultaneously, it incorporates robust monitoring systems into its operational model. This information gathering includes obtaining a Client Protection Certificate, reviewing the client's financial history (when available), and evaluating business performance indicators. By compiling this data, loan officers are better equipped to monitor their clients' financial well-being and prevent situations of over-indebtedness while including applicants who are unable to offer traditional forms of collateral. 

Credo Bank goes beyond traditional financial services by offering educational initiatives to enhance their clients' financial literacy. This approach is rooted in the bank's belief that improving customers' understanding of financial matters will yield long-term benefits. Clients with a solid grasp of their financial situation are more likely to maintain good standing with the bank and potentially become loyal, repeat customers. To this end, Credo Bank takes care to thoroughly inform each client about their range of products and services, explaining how these offerings can be tailored to meet individual financial needs and circumstances.

What is the overall cost?

Credo Bank has a loan portfolio worth $205 million and recorded a net income of $9 million in 2017. 

How was it implemented?

the management of Vision Fund, a California-based microfinance corporation. In 2014, ownership of the bank was transferred to a consortium of social impact investors, including Access Holding and funds managed or advised by ResponsAbility Investment and Triodos Investment.

A significant milestone in Credo Bank's history occurred in March 2017 when it transitioned from its status as an MFI to become a fully licensed bank. Currently, Credo Bank serves over 230,000 active customers through a network of 67 service centers spread across Georgia. Credo Bank primarily caters for three major sectors in Georgia including agriculture, tourism and urban retail. Around 30% of the bank’s clients are youth entrepreneurs under the age of 35. 

What impact has been measured?

As of 2020, Credo Bank’s activities had reportedly contributed more than 13,000 jobs per year and supported the increase of incomes for clients and their families with 45,760 children impacted overall. The bank currently has 206,000 active customers. 

What lessons can be learned?

Credo Bank credits much of its success to its strong social mission. This firm grounding in a social mission drives Credo Bank to pursue its dual objectives of creating impact and generating profit. The bank's focus on its clients' financial well-being motivates it to offer personalized financial services.

Through this approach, Credo Bank has successfully established itself as a brand with significant social impact, earning the trust of clients who believe in the bank's commitment to support them. The bank has strategically developed a robust marketing team to ensure clients are well-informed about new products and processes.

As a result of these efforts, Credo Bank has achieved widespread recognition throughout the country, including in remote areas, solidifying its reputation as a socially responsible financial institution.

Notes + Additional Context

This case study draws from the Unlocking Finance for Youth Entrepreneurs report by World Bank. See here for more information on this program and other finance policies aimed at young entrepreneurs.

CURATED BY

Tom Hancock

Research Associate
Global Entrepreneurship Network
United Kingdom