Peru’s Private Sector Credit Surge: A Sign of Economic Rebound?
Peru’s private sector credit experienced a significant boost in 2025, growing by 6.5% year-on-year, reaching 436.7 billion soles (approximately $117 billion USD). This marks the strongest growth since 2020, signaling a sustained recovery in access to credit alongside increasing macroeconomic stability, according to the Central Reserve Bank of Peru (BCRP).
Driving Forces Behind the Growth
The expansion wasn’t limited to one sector. Both personal loans and corporate financing contributed to the overall increase. Personal credit rose by 6.9% year-on-year, while loans to businesses grew by 6.2%. Interestingly, when factoring out the impact of the Reactiva Peru program (a government-backed loan initiative), corporate credit growth actually reached 7%, indicating a genuine increase in demand for productive investment.
Pro Tip: Businesses looking to expand should proactively explore financing options now, as lenders appear more willing to extend credit in the current environment.
The Role of Currency and Monthly Trends
Looking at the finer details, credit in Peruvian soles increased by 5% year-on-year, while credit in US dollars saw a more substantial jump of 12.2%. This suggests a growing preference for dollar-denominated loans, particularly for businesses involved in foreign trade and larger-scale investments.
In December 2025 alone, total credit expanded by 0.6%, largely driven by corporate financing. The trend of increasing dollar-denominated loans continued, with a 1.8% monthly expansion compared to the 0.3% growth in local currency credit. This aligns with a broader pattern observed throughout the second half of 2025.
What’s Fueling the Optimism?
Several factors are contributing to this positive trend. Controlled inflation and optimistic business expectations are key. Peru has managed to keep inflation in check, creating a more predictable economic environment. This, coupled with a gradual improvement in economic activity and a strengthening formal employment sector, is boosting business confidence and encouraging investment.
Did you know? Peru’s economic growth is closely tied to its commodity exports, particularly minerals. Stable commodity prices play a crucial role in maintaining economic stability and fostering credit growth.
Implications for SMEs
The growth in private sector credit is particularly encouraging for Small and Medium Enterprises (SMEs). SMEs often face greater challenges accessing financing than larger corporations. The increased availability of credit can empower them to invest in expansion, innovation, and job creation. Recent data shows that SMEs were leading the advance in tax collection in 2025, further demonstrating their growing economic importance.
A recent study by the World Bank highlighted that improved access to finance for SMEs in Latin America could boost GDP growth by as much as 3%.
Future Outlook: What to Expect
Experts predict that this positive momentum will continue, albeit at a potentially moderated pace. The BCRP is expected to maintain a cautious monetary policy to prevent inflationary pressures. However, continued improvements in the global economic outlook and stable commodity prices will likely support further credit growth in Peru.
The increasing demand for dollar-denominated loans could also lead to greater financial innovation, with banks developing more sophisticated hedging products to help businesses manage currency risk.
FAQ: Peru’s Credit Growth
Q: What is Reactiva Peru?
A: Reactiva Peru was a government-backed loan program designed to provide emergency financing to businesses during the COVID-19 pandemic.
Q: Why is credit growth in US dollars higher than in Peruvian soles?
A: Businesses involved in international trade and large-scale investments often prefer to borrow in US dollars to match their revenue streams and manage currency risk.
Q: What factors could derail this credit growth?
A: A global economic slowdown, a sharp decline in commodity prices, or a resurgence of inflation could all negatively impact credit growth.
Q: Where can I find more information about the BCRP’s reports?
A: You can find detailed reports and data on the BCRP’s official website: https://www.bcrp.gob.pe/
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