USD 220 billion
Microfinance Market Size, Share, Growth Analysis, 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 - Industry Forecast 2024-2031
Report ID:
SQMIG40F2001 |
Region:
Global |
Published Date: March, 2024
Pages:
207
|Tables:
64
|Figures:
75
Microfinance Market Insights
Global Microfinance Market size was valued at USD 220 billion in 2022 and is poised to grow from USD 244.20 billion in 2023 to USD 562.77 billion by 2031, growing at a CAGR of 11% during the forecast period (2024-2031).
The expansion of the microfinance market is driven by several significant factors. These include the growth of small and medium-sized businesses, along with increased access to loan facilities for low-income economic groups. The market's growth is further propelled by the offering of financial services that encourage aspiring entrepreneurs to act on their ideas. As a result, the microfinance sector is expanding, and the roles of governments and financial institutions are becoming more pronounced in both developing and underdeveloped countries.
A prominent trend contributing to the growth of the microfinance market is the rising awareness of microfinance, facilitated by improved access to technology. With the enhancement of technological infrastructure and the presence of intermediaries like microfinance credit officers, beneficiaries of microfinance services can conduct transactions conveniently and efficiently. Particularly noteworthy is the growing popularity of microfinance among rural women engaged in cottage industries, as it presents a promising avenue for augmenting household income.
The evolving nature of microfinance is another catalyst for market expansion. The increasing number of microfinance organizations in emerging countries is playing a pivotal role in reducing poverty and enhancing the living standards of the underprivileged population, thereby driving market growth. Furthermore, the shift from traditional lending practices to microfinance solutions, coupled with the advantages of lower operating costs and reduced market risk, is propelling the microfinance market's upward trajectory.
Nonetheless, there are certain challenges hampering the market's growth, including high interest rates and shorter repayment periods imposed by microfinance companies. On a contrasting note, the proliferation of advanced technologies such as mobile banking, ATMs, and point-of-sale systems in the microfinance sector across developing nations represents a significant growth opportunity for the market.
US Microfinance Market is poised to grow at a sustainable CAGR for the next forecast year.
Market Snapshot - 2024-2031
Global Market Size
Largest Segment
Banks
Fastest Growth
Banks
Growth Rate
11% CAGR
Global Microfinance Market ($ Bn)
Country Share for Asia Pacific Region (%)
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Microfinance Market Segmental Analysis
The Global Microfinance Market is segmented by Provider Type, Service Type, Application, and region. Based on Provider Type, the market can be segmented into Banks Microfinance Institutes (MFI), Non-Banking Financial Institutions (NBFCs) and Others. Based on Service Type, the market can be segmented into Group And Individual Micro-Credit, Leasing, Micro-Investment Funds, Insurance, Savings & Checking Accounts and Others. Based on Application, the market can be segmented into Agriculture, Manufacturing/Production, Trade & Services, Household and Others. Based on region, the market is segmented into North America, Europe, Asia-Pacific, Latin America, and Middle East & Africa.
Microfinance Market Analysis By Provider
The dominance during the forecast period rests with banks. This can be attributed to the heightened procurement costs and elevated security associated with the banking system, qualities that generally align with the preferences of microfinance consumers. Nonetheless, it is noteworthy that the demand for non-bank microfinancing services is projected to witness significant growth in the years to come, contributing substantially to market expansion.This suggests a changing landscape where consumers are increasingly open to exploring diverse avenues for microfinance services beyond traditional banking systems.
As financial inclusion continues to gain importance and the microfinance landscape evolves, the competition and collaboration between banks, MFIs, NBFCs, and other providers will shape the market's future trajectory. The ongoing shift in consumer preferences and the growing recognition of the unique advantages offered by non-bank microfinance options are expected to fuel a substantial demand surge in this sector, contributing to the overall growth and diversification of the global microfinance market.
Global Microfinance Market By Provider
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Microfinance Market Regional Insights
A noteworthy trend in this market is the substantial dominance of the European and North American regions. This dominance can be attributed to the increasing demand for both individual and small business lending across these areas. Furthermore, the presence of major microfinancing service providers, coupled with their proactive engagement in research and development activities aimed at enhancing security measures, significantly contributes to the anticipated growth of the global microfinance market throughout the forecast period.
Significantly, within the global context, the Asia Pacific region commands a leading share in terms of revenue contribution to the microfinance market. This prominence is primarily underpinned by China and India, which emerge as major drivers within the region. Particularly noteworthy is India's role, where financial institutions have proactively introduced microfinance schemes designed to extend loans to low-income segments of society. This initiative underscores India's position as a leader in the global microfinance market, emphasizing the integral role of microfinance in fostering economic growth and inclusivity.
Global Microfinance Market By Geography
- Largest
- Fastest
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Microfinance Market Dynamics
Microfinance Market Drivers
Financial Inclusion Initiatives
- Microfinance plays a pivotal role in providing financial services to underserved and low-income populations, contributing to broader financial inclusion goals globally.
Small Business Growth
- Increasing demand for funding among small and micro-sized businesses, particularly in emerging economies, drives the demand for microfinance services to support entrepreneurship and economic development.
Microfinance Market Restraints
Repayment Challenges
- Irregular income flows and economic instability among low-income borrowers can result in repayment challenges, impacting the sustainability of microfinance institutions.
High Interest Rates
- Microfinance institutions often charge higher interest rates to compensate for the higher risk associated with serving low-income borrowers, which can deter potential borrowers and lead to debt traps.
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Microfinance Market Competitive Landscape
The competitive landscape of the global microfinance market is characterized by a dynamic interplay of diverse players striving to cater to the financial needs of underserved populations and small businesses. Microfinance institutions (MFIs), traditional banks, non-banking financial institutions (NBFCs), and innovative fintech startups contribute to a multifaceted ecosystem.
Prominent players like SKS Microfinance and Bandhan Financial Services from India, Compartamos Banco from Mexico, and Grameen Bank from Bangladesh have established themselves as key contributors to the industry's growth. These players have demonstrated a commitment to financial inclusion by tailoring their services to meet the unique requirements of low-income individuals and micro-entrepreneurs.
The global microfinance market also witnesses participation from international organizations like ASA International, headquartered in the Netherlands, and Opportunity International based in the United States. These entities emphasize cross-border collaboration and the application of innovative business models to enhance the effectiveness of microfinance initiatives
Emerging digital-first players like Equitas Small Finance Bank and Ujjivan Financial Services, both from India, showcase the growing integration of technology within microfinance operations. Their tech-driven approach enables convenient access to financial services and efficient delivery of microloans.
Microfinance Market Top Player’s Company Profiles
- Grameen Bank (Bangladesh)
- SKS Microfinance (India) - Now part of Bharat Financial Inclusion Limited (BFIL)
- Compartamos Banco (Mexico)
- ASA International (Netherlands)
- BRAC (Bangladesh)
- Bandhan Bank (India)
- Opportunity International (United States)
- FINCA International (United States)
- Accion International (United States)
- Kiva (United States)
- Oikocredit (Netherlands)
- Fundación Génesis Empresarial (FGE) (Ecuador)
- Ujjivan Financial Services (India)
- Equitas Small Finance Bank (India)
- Amhara Credit and Savings Institution (ACSI) (Ethiopia)
- Fonkoze (Haiti)
- PRASAC (Cambodia)
- SKDRDP (Shri Kshetra Dharmasthala Rural Development Project) (India)
- Pro Mujer (United States)
- Women's World Banking (United States)
Microfinance Market Recent Developments
- In June 2023, The Global Microfinance Institute (GMI) released a report on the impact of microfinance on poverty reduction.
- In May 2023, The World Bank Group released a report on the state of microfinance in the world.
- In April 2023, The United Nations Capital Development Fund (UNCDF) launched a new initiative to promote the use of mobile money for microfinance in developing countries.
Microfinance Key Market Trends
- Digital Transformation: Increasing digitization of microfinance operations enhances efficiency, reduces costs, and improves customer experience, fostering the integration of technology into microfinance services.
- Collaborations and Partnerships: Collaborations between microfinance institutions, fintech companies, and traditional financial institutions enable the creation of innovative solutions and broader access to services.
Microfinance Market SkyQuest Analysis
SkyQuest’s ABIRAW (Advanced Business Intelligence, Research & Analysis Wing) is our Business Information Product types team that Collects, Collates, Co-relates, and Analyses the Data collected by means of Primary Exploratory Research backed by robust Secondary Desk research.
According to our global microfinance market analysis, the global microfinance market stands as a critical driver of financial inclusion and economic progress. With diverse players, including established institutions and innovative startups, the market reflects a commitment to serving underserved populations and small businesses. The dominance of European and North American regions showcases the influence of demand for individual and small business lending, while Asia Pacific's growth, fueled by emerging economies like India, highlights the sector's potential. Technological advancements, regulatory support, and impact investing further shape the market's trajectory. Ultimately, the global microfinance market's impact transcends financial services, reaching communities and individuals, and contributing to a more inclusive and resilient global economy.
| Report Metric | Details |
|---|---|
| Market size value in 2022 | USD 220 billion |
| Market size value in 2031 | USD 562.77 billion |
| Growth Rate | 11% |
| Base year | 2023 |
| Forecast period | 2024-2031 |
| Forecast Unit (Value) | USD Billion |
| Segments covered |
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| Regions covered | North America (US, Canada), Europe (Germany, France, United Kingdom, Italy, Spain, Rest of Europe), Asia Pacific (China, India, Japan, Rest of Asia-Pacific), Latin America (Brazil, Rest of Latin America), Middle East & Africa (South Africa, GCC Countries, Rest of MEA) |
| Companies covered |
|
| Customization scope | Free report customization with purchase. Customization includes:-
|
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Table Of Content
Executive Summary
Market overview
- Exhibit: Executive Summary – Chart on Market Overview
- Exhibit: Executive Summary – Data Table on Market Overview
- Exhibit: Executive Summary – Chart on Microfinance Market Characteristics
- Exhibit: Executive Summary – Chart on Market by Geography
- Exhibit: Executive Summary – Chart on Market Segmentation
- Exhibit: Executive Summary – Chart on Incremental Growth
- Exhibit: Executive Summary – Data Table on Incremental Growth
- Exhibit: Executive Summary – Chart on Vendor Market Positioning
Parent Market Analysis
Market overview
Market size
- Market Dynamics
- Exhibit: Impact analysis of DROC, 2021
- Drivers
- Opportunities
- Restraints
- Challenges
- Exhibit: Impact analysis of DROC, 2021
- SWOT Analysis
KEY MARKET INSIGHTS
- Technology Analysis
- (Exhibit: Data Table: Name of technology and details)
- Pricing Analysis
- (Exhibit: Data Table: Name of technology and pricing details)
- Supply Chain Analysis
- (Exhibit: Detailed Supply Chain Presentation)
- Value Chain Analysis
- (Exhibit: Detailed Value Chain Presentation)
- Ecosystem Of the Market
- Exhibit: Parent Market Ecosystem Market Analysis
- Exhibit: Market Characteristics of Parent Market
- IP Analysis
- (Exhibit: Data Table: Name of product/technology, patents filed, inventor/company name, acquiring firm)
- Trade Analysis
- (Exhibit: Data Table: Import and Export data details)
- Startup Analysis
- (Exhibit: Data Table: Emerging startups details)
- Raw Material Analysis
- (Exhibit: Data Table: Mapping of key raw materials)
- Innovation Matrix
- (Exhibit: Positioning Matrix: Mapping of new and existing technologies)
- Pipeline product Analysis
- (Exhibit: Data Table: Name of companies and pipeline products, regional mapping)
- Macroeconomic Indicators
COVID IMPACT
- Introduction
- Impact On Economy—scenario Assessment
- Exhibit: Data on GDP - Year-over-year growth 2016-2022 (%)
- Revised Market Size
- Exhibit: Data Table on Microfinance Market size and forecast 2021-2027 ($ million)
- Impact Of COVID On Key Segments
- Exhibit: Data Table on Segment Market size and forecast 2021-2027 ($ million)
- COVID Strategies By Company
- Exhibit: Analysis on key strategies adopted by companies
MARKET DYNAMICS & OUTLOOK
- Market Dynamics
- Exhibit: Impact analysis of DROC, 2021
- Drivers
- Opportunities
- Restraints
- Challenges
- Exhibit: Impact analysis of DROC, 2021
- Regulatory Landscape
- Exhibit: Data Table on regulation from different region
- SWOT Analysis
- Porters Analysis
- Competitive rivalry
- Exhibit: Competitive rivalry Impact of key factors, 2021
- Threat of substitute products
- Exhibit: Threat of Substitute Products Impact of key factors, 2021
- Bargaining power of buyers
- Exhibit: buyers bargaining power Impact of key factors, 2021
- Threat of new entrants
- Exhibit: Threat of new entrants Impact of key factors, 2021
- Bargaining power of suppliers
- Exhibit: Threat of suppliers bargaining power Impact of key factors, 2021
- Competitive rivalry
- Skyquest special insights on future disruptions
- Political Impact
- Economic impact
- Social Impact
- Technical Impact
- Environmental Impact
- Legal Impact
Market Size by Region
- Chart on Market share by geography 2021-2027 (%)
- Data Table on Market share by geography 2021-2027(%)
- North America
- Chart on Market share by country 2021-2027 (%)
- Data Table on Market share by country 2021-2027(%)
- USA
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Canada
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Europe
- Chart on Market share by country 2021-2027 (%)
- Data Table on Market share by country 2021-2027(%)
- Germany
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Spain
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- France
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- UK
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Rest of Europe
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Asia Pacific
- Chart on Market share by country 2021-2027 (%)
- Data Table on Market share by country 2021-2027(%)
- China
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- India
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Japan
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- South Korea
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Rest of Asia Pacific
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Latin America
- Chart on Market share by country 2021-2027 (%)
- Data Table on Market share by country 2021-2027(%)
- Brazil
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Rest of South America
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Middle East & Africa (MEA)
- Chart on Market share by country 2021-2027 (%)
- Data Table on Market share by country 2021-2027(%)
- GCC Countries
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- South Africa
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Rest of MEA
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
KEY COMPANY PROFILES
- Competitive Landscape
- Total number of companies covered
- Exhibit: companies covered in the report, 2021
- Top companies market positioning
- Exhibit: company positioning matrix, 2021
- Top companies market Share
- Exhibit: Pie chart analysis on company market share, 2021(%)
- Total number of companies covered
Methodology
For the Microfinance Market, our research methodology involved a mixture of primary and secondary data sources. Key steps involved in the research process are listed below:
1. Information Procurement: This stage involved the procurement of Market data or related information via primary and secondary sources. The various secondary sources used included various company websites, annual reports, trade databases, and paid databases such as Hoover's, Bloomberg Business, Factiva, and Avention. Our team did 45 primary interactions Globally which included several stakeholders such as manufacturers, customers, key opinion leaders, etc. Overall, information procurement was one of the most extensive stages in our research process.
2. Information Analysis: This step involved triangulation of data through bottom-up and top-down approaches to estimate and validate the total size and future estimate of the Microfinance Market.
3. Report Formulation: The final step entailed the placement of data points in appropriate Market spaces in an attempt to deduce viable conclusions.
4. Validation & Publishing: Validation is the most important step in the process. Validation & re-validation via an intricately designed process helped us finalize data points to be used for final calculations. The final Market estimates and forecasts were then aligned and sent to our panel of industry experts for validation of data. Once the validation was done the report was sent to our Quality Assurance team to ensure adherence to style guides, consistency & design.
Analyst Support
Customization Options
With the given market data, our dedicated team of analysts can offer you the following customization options are available for the Microfinance Market:
Product Analysis: Product matrix, which offers a detailed comparison of the product portfolio of companies.
Regional Analysis: Further analysis of the Microfinance Market for additional countries.
Competitive Analysis: Detailed analysis and profiling of additional Market players & comparative analysis of competitive products.
Go to Market Strategy: Find the high-growth channels to invest your marketing efforts and increase your customer base.
Innovation Mapping: Identify racial solutions and innovation, connected to deep ecosystems of innovators, start-ups, academics, and strategic partners.
Category Intelligence: Customized intelligence that is relevant to their supply Markets will enable them to make smarter sourcing decisions and improve their category management.
Public Company Transcript Analysis: To improve the investment performance by generating new alpha and making better-informed decisions.
Social Media Listening: To analyze the conversations and trends happening not just around your brand, but around your industry as a whole, and use those insights to make better Marketing decisions.
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