microfinance

IPA/ˈmaɪkrəʊfaɪnæns/
IPA/ˈmaɪkrəʊfaɪnæns/

microfinance — noun

1. the practice of giving very small loans, savings accounts, or other money servic

1.nounC1
Definition

the practice of giving very small loans, savings accounts, or other money services to low-income individuals and tiny businesses that cannot borrow from regular banks.

Example

Adisa runs a microfinance group that lends small sums to weavers in northern Ghana.

microfinance + noun (group / programme / institution)

The charity uses microfinance to help women in rural Bangladesh start their own tailoring shops.

use microfinance to + verb

Common collocations
  • microfinance institution
  • microfinance programme
  • microfinance loan
  • access to microfinance
  • rural microfinance
Synonyms
  • microcredit

    narrower — specifically the small-loan part of microfinance, without savings or insurance services

  • microlending

    near-synonym focused on the lending activity itself, often used interchangeably in news writing

Grammar Patterns

microfinance for [borrowers]

microfinance to [borrowers]

Usage Note

Uncountable noun — never 'a microfinance' or 'microfinances'. Common subjects are people, charities, or institutions (a microfinance bank, a microfinance fund). Often paired with development-context vocabulary: 'rural', 'developing', 'poverty', 'borrowers'.

Common Mistakes

She works in a microfinance.
She works in microfinance.
uncountable; no article needed when naming the field itself.
The bank gave her a microfinance of three hundred dollars.
The bank gave her a microloan of three hundred dollars.
the individual loan is a 'microloan'; 'microfinance' is the whole activity or sector.

Word family

Synonym discussion

Sense: noun/1

All three describe small-scale money services for the poor, but they differ in scope and emphasis. Microfinance is the widest term: it covers small loans, but also savings accounts, money transfers, and even small insurance products designed for low-income clients. Microcredit is narrower, naming only the lending part of microfinance — when a non-profit lends fifty dollars to a market trader, that loan is microcredit, and the organisation providing it works in microfinance. Microlending is close to microcredit and is the term news writing in the United States often prefers; in development reports the technical preference is microcredit. For example, you might read that 'microfinance institutions offer both microcredit and savings to rural women', showing how the broader sector contains the narrower lending activity.

microfinance ↗microcredit ↗microlending

Common collocations

Nouns

  • microfinance institution
  • microfinance programme
  • microfinance loan
  • microfinance sector
  • microfinance bank

Phrases

  • access to microfinance
  • expansion of microfinance

Prepositions

  • through microfinance
  • in microfinance
  • for microfinance

Etymology

GreekLatinFrenchEnglish

Formed in English in the late twentieth century by combining the Greek-derived prefix 'micro-' (meaning 'small') with 'finance' (from Old French finer, to pay, and ultimately Latin finis, end or settlement). The term spread internationally after Muhammad Yunus and the Grameen Bank in Bangladesh demonstrated, in the 1970s and 1980s, that very small loans to poor borrowers could be repaid reliably; awarding them the 2006 Nobel Peace Prize cemented the word in everyday economic writing.