PRASAC MFI was a former credit component of PRASAC’s project funded by the European Union and implemented by three ministries of the Royal Government of Cambodia.​​ The project started in 1995 to rehabilitate and support agricultural sector in six provinces around Phnom Penh i.e. Kampong Cham, Kampong Chhnang, Kampong Speu, Takeo, Prey Veng, and Svay Rieng. PRASAC’s project finished in December 2003.

To ensure the access to financial services to rural communities and micro-enterprises, PRASAC’s Project Steering Committee made a strategic decision to transform its credit component into a licensed MFI. In March 2002, the transformation was started by creating PRASAC Credit Association as a credit operator registered with the National Bank of Cambodia (NBC).

In 2003, a trust fund called Cambodia Rural Development Foundation (CRDF) and PRASAC Staff Company were established to facilitate the transformation. With two initial shareholders, PRASAC MFI Ltd was established by registering with the Ministry of Commerce as a private limited liability company in August 2004 and got its license from the NBC in November 2004 to legally provide financial services to rural communities and micro-enterprises.

To finalize its transformation, PRASAC started to identify and negotiate with investors since 2005 in order to replace the temporary shareholders i.e. CRDF. In 2007, PRASAC completed its transformation by replacing CRDF with five new shareholders namely BIO (Belgian Investment Company for Developing Countries), DGC (Dragon Capital Group), FMO (The Netherlands Development Finance Company), LOLC (Lanka ORIX LEASING Company Ltd), and Oikocredit. Particularly, PRASAC received a permanent license from NBC in December 2007.

PRASAC engaged primarily in the provision of micro-finance services to the rural population of Cambodia through its headquarters in Phnom Penh and various provincial and district offices in Cambodia. The amended Memorandum and Articles of Association for the changes in shareholders were certified by the Ministry of Commerce and the National Bank of Cambodia on 14 October 2008 and 6 November 2008 respectively.

In order to meet requirements and serve as a platform for future growth and diversification, PRASAC launched Oracle FLEXCUBE Universal Banking as its Core Banking System to ease banking transactions, to build a competitive advantage, help us to better serve targeted customers across Cambodia and effectively manage the information system. On 27 August 2010, PRASAC obtained a Microfinance Deposit Taking Institution (“MDI”) license for the Head Office to conduct deposit taking business from the National Bank of Cambodia.

With  license to conduct micro finance business permanently and MDI to operate in Cambodia, PRASAC is now focusing on strengthening its operations and processes to take on a larger role in the country's financial development by providing financial services to rural communities and microenterprises.