Microfinance entails delivering financial services to individuals or groups with low incomes who are typically excluded from traditional banking. The primary focus of most microfinance institutions is to provide credit in the form of small working capital loans, commonly referred to as microloans or microcredit.
Microfinance aims to extend financial services to economically disadvantaged individuals who are traditionally overlooked by mainstream financial institutions. In Nigeria, a significant portion of the population still lacks access to financial services.
Varieties of Microfinance Institutions (MFIs) include Village Savings and Credit Associations (VISACAs), Finance Companies (FCs), and Fiduciary Financial Institutions (FFIs).