What is Microfinance?

Microfinance is the provision of basic financial services (including but not limited to loans, savings, trainings etc) to the economically active poor.

Who supervises the Microfinance Banks?

They are basically supervised by the Central Bank of Nigeria.

Why are Microfinance Banks different from the Co-operative Societies?

Microfinance Banks are licensed by the Central Bank of Nigeria to actively source funds from the populace. Co-operative Societies only operate amongst their members. Unlike microfinance banks, co-operative societies operate within a closed group – its members only. Co-operatives are also not licensed by the Central Bank of Nigeria.

Depositors in microfinance banks are also insured by the Nigeria Deposit Insurance Corporation (NDIC).