Microfinance Market Size & Growth Analysis to 2030

The global microfinance market size was estimated to be around USD 185 billion in 2022 and is expected to grow at a compound annual growth rate (CAGR) of around 12% during the forecast period of 2023 to 2030. The market growth is mainly driven by the increasing demand for microfinance services from low-income households and small businesses in emerging economies.

Moreover, the rising adoption of technology-enabled microfinance solutions and the growing emphasis on financial inclusion by governments and financial institutions are also contributing to market growth. The market is expected to witness significant growth opportunities in regions such as Asia-Pacific, Latin America, and Africa, where there is a large unbanked population and increasing awareness of microfinance services.

There are several driving factors for the growth of the microfinance market. One of the main factors is the increasing demand for financial services in developing countries, where many people lack access to traditional banking services. Microfinance institutions (MFIs) provide access to credit, savings, insurance, and other financial products and services to these underserved populations.

Additionally, the rise of digital technology has made it easier for MFIs to reach more customers in remote areas and offer more convenient and affordable financial services. Another driving factor is the growing interest from investors and donors in supporting microfinance as a means of promoting financial inclusion and poverty alleviation. Government policies and regulations that support the development of microfinance institutions also play a role in driving the growth of the microfinance market.

Market Snapshot:

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Market Insights:

The global microfinance market is bifurcated into provider, end-user, and geography. On the basis of provider, the market is further segmented into banks, microfinance institutes, non-banking financial institutions, and others. MFIs are considered the dominant category of microfinance providers, as they are specialized institutions that offer financial services, including credit, savings, insurance, and payment services, to low-income individuals and small businesses that lack access to traditional banking services. MFIs operate with a social mission to alleviate poverty and promote financial inclusion. Other types of microfinance providers, such as banks and credit unions, may also offer microfinance services, but they may not have the same level of specialization and social mission as MFIs. NBFCs also play a significant role in microfinance, particularly in developing countries, by providing financial and non-financial services to underserved communities.

Commercial Banks: Commercial banks have also entered the microfinance market in recent years, driven by the potential for profitable returns from microfinance loans.

Microfinance Institutions (MFIs): MFIs are specialized financial institutions that provide financial services to micro-entrepreneurs, including microcredit, micro-savings, micro-insurance, and money transfer services.

NBFC (Non-Banking Financial Institutions): NBFC stands for Non-Banking Financial Company. It is a financial institution that provides banking services without holding a banking license. NBFCs are regulated by the Reserve Bank of India (RBI) and provide a range of financial services such as loans and advances, asset financing, credit facilities, and investment activities. However, they are not allowed to accept demand deposits or issue cheques to their customers. NBFCs play an important role in providing credit to small and medium-sized enterprises (SMEs), as well as to individuals who do not have access to traditional banking services.

The global microfinance market report explores the critical analysis of the industry using key parameters. The report covers investment strategies, the need for investment in the industry, and several benefits for investors. Significantly, this report sets out major changes in the global technical regulations for the market, as well as how economic and non-economic constraints are helping the market to grow. Furthermore, the report analyzes the historic and forecasted market size at the global, regional, and country-level. The report also provides a comprehensive analysis of key investment proposals, competitor positions, porter’s five force analysis, SWOT analysis, pestel analysis, value chain analysis, etc.

The microfinance market research report presents the analysis of each segment from 2020 to 2030 considering 2022 as the base year for the research. The compounded annual growth rate (CAGR) for each respective segment is calculated for the forecast period from 2023 to 2030.

Historical & Forecast Period

• 2020-21 – Historical Year
• 2022 – Base Year
• 2023-2030 – Forecast Period

Market Segmentation:

By Provider:

• Banks
• Micro Finance Institute (MFI)
• NBFC (Non-Banking Financial Institutions)
• Others

By End-User:

• Small Enterprises
• Micro Enterprises
• Solo Entrepreneurs or Self-Employed

By Region:

• North America
• Europe
• Asia Pacific
• Latin America
• Middle East & Africa

Geographic Coverage:

Geographically, the microfinance market report comprises dedicated sections centering on the regional market revenue and trends. The microfinance market has been segmented on the basis of geographic regions into North America, Europe, Asia Pacific, Latin America, and the Middle East & Africa. The microfinance market has been extensively analyzed on the basis of various regional factors such as demographics, gross domestic product (GDP), inflation rate, acceptance, and others. Microfinance market estimates have also been provided for the historical years 2020 & 2021 along with forecasts for the period from 2023 – 2030.

Competitive Assessment:

Some of the prominent market players operating in the global microfinance market are Grameen Bank, SKS Microfinance, Bandhan Financial Services, Compartamos Banco, and BlueOrchard Finance. Companies are exploring markets through expansion, new investment, the introduction of new services, and collaboration as their preferred strategies.

COVID-19 Relief Measures: Many microfinance institutions have offered COVID-19 relief measures to their clients, such as loan repayment moratoriums and loan restructuring, to help them cope with the economic impact of the pandemic.

Digitalization: The microfinance industry is increasingly adopting digital technologies, such as mobile banking and digital payments, to improve efficiency and reach more clients in remote areas.

Partnerships: Microfinance institutions are partnering with other organizations, such as fintechs and social enterprises, to expand their reach and offer new products and services to their clients.

Impact Investing: Impact investors are increasingly interested in the microfinance sector, as it offers opportunities for social and financial returns.

Green Microfinance: Microfinance institutions are also focusing on promoting environmental sustainability by offering loans and other financial services for eco-friendly projects and businesses.

Key Companies:

• Grameen Bank
• SKS Microfinance
• Bandhan Financial Services
• Compartamos Banco
• BlueOrchard Finance
• ASA International
• Opportunity International
• FINCA International
• MicroEnsure
• Accion International

Key Questions Answered by Microfinance Market Report

• Global microfinance market forecasts from 2023-2030
• Regional market forecasts from 2023-2030 covering Asia-Pacific, North America, Europe, Middle East & Africa, and Latin America
• Country-level forecasts from 2023-2030 covering 15 major countries from the regions as mentioned above
• Microfinance submarket forecasts from 2023-2030 covering the market by provider, end-user, and geography
• Various industry models such as SWOT analysis, Value Chain Analysis about the market
• Analysis of the key factors driving and restraining the growth of the global, regional, and country-level microfinance markets from 2023-2030
• Competitive Landscape and market positioning of the top 10 players operating in the market