Project Experience

Guatemala

Feasibility Study for Upgrading: Feasibility Study for the Institutional Transformation Process of a Microfinance NGO, 2010

One of the largest microfinance providers in Guatemala is considering converting from an NGO into a regulated or unregulated financial entity, with the possibility of obtaining a banking license in the medium term.

LFS was engaged by IFC to prepare a study to determine the feasibility of the transformation of the NGO into a financial entity (regulated or unregulated) in the Guatemalan context. Given that no microfinance regulation exists in Guatemela yet, the study recommends the transformation of the NGO into a commercial bank with a focus on microfinance within the next 5 years. If the planned microfinance regulation should enter into force in the next few years, the transformation into a specialized microfinance institution could also be an option for the NGO.

In a second step, LFS elaborated a transformation plan with details on the necessary resources and processes for the transformation of the NGO into a commercial bank.