Difference between “Microfinance” and “Microcredit”

Although the terms Microcredit and Microfinance are often used interchangeably, it is important to recognize the distinction between the two.


Microcredit refers to the act of providing the loan. Microfinance, on the other hand, is the act of providing these same borrowers with financial services, such as savings institutions and insurance policies.


In short, microfinance encompasses the field of microcredit.


  • Benefits of Islamic Microfinance
  • Riba Free Operations
  • Shift of Focus to TRADING MODE
  • Better Internal Controls
  • Reduced Miss utilization of Money in Non-Productive Activities
  • Overall Benefits to Economic Environment
  • More Social Acceptability