Microfinance Market Report 2026

The microfinance market size has grown rapidly in recent years. It will grow from $239.09 billion in 2025 to $266.13 billion in 2026 at a compound annual growth rate (CAGR) of 11.3%. The growth in the historic period can be attributed to expansion of informal sector employment, limited access to traditional banking, growth of self-employment activities, increasing role of mfis in rural finance, adoption of group lending models.

The microfinance market size is expected to see rapid growth in the next few years. It will grow to $406.39 billion in 2030 at a compound annual growth rate (CAGR) of 11.2%. The growth in the forecast period can be attributed to expansion of digital financial services in emerging markets, increasing use of ai-driven credit assessment, growth of mobile payment ecosystems, rising demand for inclusive financial products, integration of microfinance with digital identity systems. Major trends in the forecast period include increasing use of mobile-based microfinance platforms, rising adoption of alternative credit scoring models, growing focus on financial inclusion programs, expansion of digital loan disbursement systems, enhanced integration of micro-savings and insurance products.

The increasing number of small and medium-sized enterprises (SMEs) is expected to propel the growth of the microfinance market going forward. Small and medium-sized enterprises (SMEs) refer to businesses that are characterized by their relatively small scale in terms of revenue, assets, and number of employees. The number of SMEs is increasing due to a surge in entrepreneurial spirit, technological advancements lowering entry barriers, supportive government policies, and expanded global market access. Microfinance supports SMEs by offering crucial access to small loans and financial services, aiding in capital acquisition, cash flow management, and risk mitigation. For instance, in February 2024, according to a report published by Startups.co.uk, a UK-based provider of online resources and advice platforms, in 2023, new SME businesses surged by 19.5% to 39,966 establishments, reflecting a 6.5% increase from 2022, while overall incorporations grew by a modest 2% to 778,219 in 2022. Therefore, the increasing number of small and medium-sized enterprises (SMEs) is driving the growth of the microfinance market.

Major companies operating in the microfinance market focus on developing innovative solutions with technological advancements, such as digital platforms, to enhance accessibility, streamline operations, and improve financial inclusion for underserved populations. Digital platforms refer to online systems that enable users to connect, interact, and exchange goods, services, or information. They facilitate business transactions, communication, and content sharing. For instance, in August 2023, The Reserve Bank of India (RBI), India-based central bank of india, launched the Public Tech Platform for Frictionless Credit, aimed at improving access to credit for micro, small, and medium enterprises (MSMEs). This initiative is designed to streamline credit delivery through financial institutions, thereby enhancing financial inclusion.

In March 2024, Kotak Mahindra Bank, an India-based private sector bank, acquired Sonata Finance Private Limited for $64.56 million. Through this acquisition, Kotak Mahindra aims to bolster its position in the financial services sector by integrating Sonata Finance Private Limited's operations and leveraging its market presence. Sonata Finance Private Limited is an India-based non-banking finance company (NBFC) specializing in microfinance.

Major companies operating in the microfinance market are Bank Rakyat Indonesia (BRI), Bandhan Bank Limited, ASA International Group PLC, Accion International, Annapurna Finance Private Limited, PRASAC Microfinance Institution Ltd., 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.

Asia-Pacific was the largest region in the microfinance market in 2025, and is expected to be the fastest-growing region in the forecast period. The regions covered in the microfinance market report are Asia-Pacific, South East Asia, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the microfinance market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Taiwan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

The microfinance market includes revenues earned by entities by providing services such as microloans, microinsurance, money transfers, payment services, and financial education. The market value includes the value of related goods sold by the service provider or included within the service offering. Only goods and services traded between entities or sold to end consumers are included.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

This product will be delivered within 1-3 business days.