The second study on the social impact of microfinance on the development of rural communities

Patria Credit IFN Drives Rural Communities Development: New Study Confirms High Social Impact of Microfinance in Romania

• Microfinance drives business growth (49% profit increase, 96% investments) and improves household well-being (99% home ownership, growing savings and education investment).
• Women play a key role in 88% of businesses, despite representing only 24% of clients.
• Half of clients rely exclusively on Patria Credit IFN, with 28% unbanked, proving strong outreach to vulnerable groups.
• Patria Credit IFN scored 32 out of 36 points in social impact performance – a “high overall” rating.

Infographic Social Impact Study 

Social Impact Assessment Evaluation

A new nationwide study financed by the Council of Europe Development Bank (CEB) reveals that Patria Credit IFN, the oldest non-banking financial institution dedicated to financing farmers and small businesses in Romania,  is a cornerstone of Romania’s rural development, with its microfinance activities driving both economic progress and social inclusion in underserved communities.

The study utilized a robust mixed-methods research design, combining quantitative surveys with in-depth qualitative interviews to capture a holistic view of the social impact. Data collection occurred from January 29, 2025, to April 1, 2025. Primary quantitative data was gathered from a national sample of 500 Patria Credit IFN clients, constructed with a 5% margin of error. The study compared 400 long-term clients (over 24 months with Patria Credit) to 100 new clients (first loan within the past two years). Qualitative data was collected through in-depth interviews with clients (39 in-depth interviews), loan officers (7 in-depth interviews), and local community stakeholders (e.g., mayors, agricultural agents) (10 in-depth interviews) across seven representative communities: Moțăței – Dolj County, Drăgășani – Vâlcea County, Băleni – Dâmbovița County, Glodeanu Sărat – Buzău County, Corbasca and Pâncești – Bacău County, and selected areas in Sălaj, Maramureș and Satu Mare Counties.

These communities complement the three locations included in the initial impact study conducted in 2022—two rural areas (Scărișoara in Olt County and Matca in Galați County) and one small urban area (Târgu Frumos in Iași County). By expanding the geographic coverage and combining the findings from both studies, the research enables a broader and more robust assessment of Patria Credit IFN’s lending activities at the national level. Also, through the new study, the social impact assessment toolkit developed in 2022 has been revised and improved.

By refining the microfinance social impact assessment toolkit derived from the 2022 study and applying it to Patria Credit IFN, the microfinance institution obtained a score of 32 out of 36 points, classifying the institution as “high performing” (Patria Credit social impact assessment evaluation)

The main findings of the study show the following:

Financial Inclusion: 50% of clients rely exclusively on Patria Credit IFN for financing. 28% of clients are unbanked, highlighting the institution’s outreach beyond the formal banking system. Loans are mainly directed to agriculture: 72% for equipment, as well as land, livestock, and construction.     Patria Credit score: 10 points out of 12

Business Development: 49% of clients reported profit growth, while 96% invested in business assets in the past three years. Newer clients earn on average RON 10,162/month, compared to RON 6,172/month for mature clients, showing dynamism among younger businesses. 85% of clients see high costs and taxes as their main barrier to further growth.   Patria Credit score: 6 points out of 6

Household Well-Being: Nearly all clients (99%) own their homes, equipped with modern goods and, increasingly, renewable energy solutions. 39% of new clients have savings, compared to 28% of mature clients, reflecting stronger financial security among younger households. Investment in education is rising, especially among new clients who prioritize higher education for their children.     Patria Credit score: 9 points out of 9

Community Development: Women, though only 24% are business owners in the clients base, are involved in 88% of businesses, underscoring their pivotal role in management and family enterprise. Patria Credit IFN loans support local solidarity and economic resilience, providing a favorable framework for development, even in areas where job creation is still at its beginning (10% of beneficiaries have permanent employees).   Patria Credit score: 7 points out of 9

 

“This study confirms what we see every day in the field: access to finance transforms lives and communities,” said Raluca Andreica, CEO of Patria Credit IFN. “Our clients are building stronger businesses, sending their children to higher education, and shaping a more resilient rural Romania. At Patria Credit, we are proud to expand opportunities where they are needed most.”

“Supporting institutions that combine financial sustainability with measurable social impact is at the heart of CEB’s mandate,” added Tanja Faller, Director, Technical Assessment and Monitoring Directorate, Council of Europe Development Bank. “Patria Credit IFN is proving to be a catalyst for inclusive growth, directly advancing European priorities on social economy and rural development.”

By complementing the 2022 research with new data from an expanded geographic sample, the study provides one of the most comprehensive evaluations of microfinance impact to date in Romania. It shows how microfinance strengthens economic activity, improves quality of life, and empowers women and youth, while also highlighting challenges such as limited job creation and adoption of modern technologies.

The study was realized under the guidance and coordination of Claudia Petrescu, scientific researcher at the Research Institute for Quality of Life, Romanian Academy and Dr. Roxana Florența Săvescu, Associate Professor at Lucian Blaga University of Sibiu.