Created to serve underprivileged populations, microfinance includes an array of financial services, including: microcredit, small savings, micro insurance, money transfers, micro-leasing and payment services.

Microfinance targets the population considered not creditworthy by the formal banking sector. This population group is generally not given access to formal financial services for the simple reason that they are unable to build-up enough savings and that the small loan management is too costly to be considered as enough attractive to banks. As a consequence, they generally seek loans from money lenders or other informal sources, often at exorbitant interest rates.

Compared to banks Microfinance Institutions (MFI) charge relatively high interest rates, generally between 24% and 40%. This is largely due to the high costs of running a portfolio of many small loans, in some cases it also reflects a certain degree of monopoly. However as the market develops, attracting new entrants, interest rates are likely to drop significantly.