microcredit

IPA/ˈmaɪ.krəʊˌkred.ɪt/
KK[mˈaɪkrˌokrˈɛdɪt]IPA/ˈmaɪ.kroʊˌkred.ɪt/

microcredit — noun

1. small amounts of money that organisations lend to people with low incomes, often

1.nounB2
Definition

small amounts of money that organisations lend to people with low incomes, often to help them start or expand a small business.

Example

The non-profit offers microcredit to women in rural communities who want to open small shops.

collocation: offer microcredit

A microcredit of two hundred dollars helped Diego buy tools and start his repair shop.

collocation: a microcredit of [amount]

Common collocations
  • offer microcredit
  • provide microcredit
  • receive microcredit
  • use microcredit
  • microcredit programme
  • microcredit loan
Synonyms
  • microloan

    refers to the specific sum of money lent, whereas microcredit describes the broader lending scheme

  • microfinance

    a wider term that includes savings accounts, insurance, and financial training alongside lending

Usage Note

Typically uncountable. Often used in discussions of international development and poverty-reduction programmes.

Common Mistakes

She used a microcredit to buy a new television.
She used a microcredit to start a small bakery.
Microcredit is meant for business or income-generating activities, not for ordinary consumer purchases.

Word family

Synonym discussion

Sense: noun/1

Microcredit, microloan, and microfinance are closely related but differ in scope. Microcredit is the practice of lending small sums to people who lack access to traditional banking. A microloan is the specific amount of money given to one borrower — it is the concrete tool within the microcredit system. Microfinance is the broadest term, covering not only credit and loans but also savings accounts, insurance, and financial literacy training. For example, a woman might receive a microloan of $150 through a microcredit programme run by a microfinance institution that also teaches her how to budget.

microcredit ↗microloan ↗microfinance ↗

Common collocations

Nouns

Phrases

  • access to microcredit
  • microcredit for women
  • microcredit in developing countries

Etymology

GreekLatinEnglish

The word was coined in the 1970s from the prefix micro- (from Greek mikros, 'small') and credit (from Latin creditum, 'a loan, something entrusted to another'). The concept was popularised by economist Muhammad Yunus and the Grameen Bank in Bangladesh, who showed that lending very small amounts could lift people out of poverty.