The microlending market size has grown rapidly in recent years. It will grow from $214.08 billion in 2024 to $241.99 billion in 2025 at a compound annual growth rate (CAGR) of 13.0%. The growth in the historic period can be attributed to financial inclusion initiatives, entrepreneurship and small businesses, poverty alleviation programs, community development, women’s empowerment.
The microlending market size is expected to see rapid growth in the next few years. It will grow to $390.38 billion in 2029 at a compound annual growth rate (CAGR) of 12.7%. The growth in the forecast period can be attributed to digital financial services adoption, impact investing and social finance, emergence of fintech solutions, climate-smart lending, government support programs. Major trends in the forecast period include use of alternative data for credit assessment, employment of robotic process automation (RPA), focus on financial inclusion and rural microlending, flexible repayment models and microfinance products, regulatory framework development.
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What are the key drivers behind the rapid expansion of the microlending market?
The rising need for micro-lending among end-users, including micro-enterprises and small enterprises is expected to propel the growth of the microlending market going forward. Small and medium enterprises are organizations whose personnel and revenue numbers are below certain limits. Microlending helps small and medium enterprises to grow through small-dollar lending and helps them to prosper in their business. For instance, according to the World Bank, a US-based international financial institution, and estimates of The International Finance Corporation (IFC), a member of the world bank group, it is estimated that approximately 65 million firms, and 40% of formal micro, small and medium enterprises (MSMEs) in developing countries, are in financial need of $5.2 trillion every year, which is equal to 1.4 times the current level of the global MSME lending. Further, MSME Growth, Innovation, and Inclusive Finance Project improved access to finance for MSMEs in India, which aims in lending $1.5 billion to startups by 2025. Therefore, rising demand for micro-lending among end-users, including micro-enterprises and small enterprises drives the microlending market.
What is the segmentation for the microlending market?
The microlending market covered in this report is segmented –
1) By Provider: Banks, Micro Finance Institute (MFI), NBFC (Non-Banking Financial Institutions), Other Provider
2) By End-User: Small Enterprises, Micro Enterprises, Solo entrepreneurs And self-employed
Subsegments:
1) By Banks: Traditional Banks, Online Banks
2) By Micro Finance Institutions (MFI): Non-Governmental Organizations (NGOs) Offering MFIs, Cooperative Microfinance Institutions
3) By Non-Banking Financial Institutions (NBFC): Private NBFCs, Public NBFCs
4) By Other Providers: Peer-to-Peer Lending Platforms, Community Lending Groups, Fintech Companies Offering Microlending Solutions
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Who are the most influential companies in the microlending market?
Major companies operating in the microlending market include ICICI Bank Ltd., Bajaj Finserv Ltd., HDB Financial Services Ltd., Bandhan Bank Ltd., LendingClub Corporation, Faulu Microfinance Bank Limited, MicroVest LLC, Kiva Microfunds, Fusion Micro Finance Ltd., Accion International, Equitas Small Finance Bank Ltd., ESAF Small Finance Bank, Fincare Small Finance Bank Ltd., Ujjivan Small Finance Bank Ltd., Oakam Ltd., Small Industries Development Bank of India, One Acre Fund, FINCA International Impact Investments, Fonds National de Coopératives de Développement Economique et Sociale Agricole, Gray Ghost Ventures LLC, Elevar Equity LLC, Incofin Investment Management plc, ResponsAbility Investments AG, ImpactAssets Fund
What are the most influential trends expected to drive the microlending market forward?
Major companies operating in the microlending market are focusing on new technologies such as digital payment ecosystems to enhance accessibility and efficiency in financial transactions, streamline loan disbursement processes, improve customer experience, and promote financial inclusion for underserved populations. Digital payment ecosystems are interconnected networks that facilitate electronic transactions through various platforms and technologies, enabling consumers and businesses to conduct payments seamlessly. For instance, in April 2024, IDB Group, a US-based financial services company, launched FINLAC. FINLAC aims to ensure that marginalized groups, including rural communities, indigenous peoples, Afro-descendant populations, women, migrants, older adults, and micro and small businesses, can access essential financial services.
What are the major regional insights for the microlending market, and which region holds the top position?
The countries covered in the microlending market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.
What Does The Microlending Market Report 2025 Offer?
The microlending market research report from The Business Research Company offers global market size, growth rate, regional shares, competitor analysis, detailed segments, trends, and opportunities.
Microlending refers to microfinance that supports enterprises by lending small amounts for business expansion. The primary advantage of microlending is that it allows borrowers to take loan who do not have the sufficient assets to act as a guarantee or simply do not want to risk their assets.
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