What are the Historical Developments and Current Growth Metrics of the Microfinance Market?
The microfinance market has seen considerable growth due to a variety of factors.
• The microfinance market has grown rapidly in recent years. It will increase from $215.51 billion in 2024 to $240.49 billion in 2025, reflecting a CAGR of 11.6%.
The market expansion can be attributed to the increased use of digital technology, commercialization and sustainability, a focus on responsive lending, greater access to loan facilities, and the rise of online lending platforms.
What is the Forecasted Market Size and CAGR for the Microfinance Market?
The microfinance market is expected to maintain its strong growth trajectory in upcoming years.
• The microfinance market is expected to grow rapidly, reaching $368.02 billion by 2029 at a CAGR of 11.2%.
This growth is due to evolving regulatory frameworks, the focus on environmental sustainability, rising demand for microfinance loans, and increased financial inclusion. Major trends include cloud computing integration, biometrics and digital identity adoption, microinsurance, embedded payments, and standardizing digital operations.
What Key Factors and Trends Are Driving The Growth Microfinance Market?
The increasing number of small and medium-sized enterprises (SMEs) is expected to drive the growth of the microfinance market. SMEs, which are characterized by their small scale in revenue, assets, and employees, are on the rise due to growing entrepreneurial activity, advances in technology, and supportive government policies. Microfinance provides these enterprises with small loans and financial services to aid in business expansion and risk management. A report by Startups.co.uk in February 2024 showed a 19.5% increase in new SMEs, which grew to 39,966 businesses in 2023, further driving the microfinance market.
What Are The Market Segments In The Microfinance Market?
The microfinance market covered in this report is segmented –
1) By Service Type: Group And Individual Micro Credit, Leasing, Micro Investment Funds, Insurance, Savings And Checking Accounts, Other Service Types
2) By Providers: Banks, Micro Finance Institutions (MFI), NBFC (Non-Banking Financial Institutions), Other Provider
3) By Purpose: Agriculture, Manufacturing Or Production, Trade And Services, Household, Other Purposes
4) By End-Users: Small Enterprises, Micro Enterprises, Solo Entrepreneurs Or Self-Employed
Subsegments:
1) By Group And Individual Micro Credit: Group Lending Programs Or Individual Micro Loans
2) By Leasing: Equipment Leasing Or Vehicle Leasing Or Real Estate Leasing
3) By Micro Investment Funds: Equity Funds Or Debt Funds Or Hybrid Funds
4) By Insurance: Micro Life Insurance Or Micro Health Insurance Or Micro Property Insurance
5) By Savings And Checking Accounts: Micro Savings Accounts Or Micro Checking Accounts
6) By Other Service Types: Remittance Services Or Payment Solutions Or Financial Literacy Programs
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Which Emerging Market Trends Are Altering The Microfinance Industry?
In an effort to foster financial inclusion for underrepresented communities, key players in the microfinance sector are concentrating on the creation of innovative solutions via digital platforms, promoted by technological advancements. Essentially, these digital platforms are online systems which allow users to engage, interact, and trade services, goods, or information, making business transactions, communication, and content sharing easier. For instance, The Reserve Bank of India (RBI), the central bank of the country, launched a public tech platform known as Frictionless Credit in August 2023. The platform is aimed at boosting credit accessibility for micro, small and medium enterprises (MSMEs) in order to simplify credit delivery through financial institutions and promote financial inclusion.
Who Are the Key Players In The Microfinance Market?
Major companies operating in the microfinance market are:
• Bank Rakyat Indonesia (BRI)
• Oliver Wyman Group
• Bandhan Bank Limited
• LendingClub Corporation
• ASA International Group PLC
• Accion International
• Annapurna Finance Private Limited
• PRASAC Microfinance Institution Ltd.
• Prosper Marketplace Inc
• Madura Microfinance Ltd.
• Compartamos Banco
• Pro Mujer International
• Oikocredit International
• Ujjivan Financial Services
• Fundación Génesis Empresarial (FGE)
• Kiva Microfunds
• Gojo & Company Inc.
• FINCA International
• Fonkoze Financial Services S.A.
• Cashpor Micro Credit
• Opportunity International
• BSS Microfinance Limited
• Asirvad Microfinance Limited
What Are The Regional Insights Into The Microfinance Market?
Asia-Pacific was the largest region in the microfinance market in 2024, and is expected to be the fastest-growing region in the forecast period. The regions covered in the microfinance market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa.
