Microfinance: Small loans backed by trust

Today, our topic is microfinance. Here is the Vocabulary: It is a much longer list today. Listen closely, and listen to this section a few times if you need to! Microfinance: this refers to the financial services provided to low-income individuals or groups who are typically excluded from traditional banking. Working capital: money that the entrepreneur can use for day-to-day operations, or purchase transport or equipment. Microcredit: A part of the field of microfinance, microcredit is the provision of credit services to low-income entrepreneurs. Another way to say microcredit is microloan. Collateral: Something offered as security for the repayment of the loan. Unbanked: A term used to describe the world’s working poor who are outside of the formal banking sector. Microentrepreneur: Micro entrepreneurs are people who own small-scale businesses that are known as microenterprises. Financial Inclusion: Financial inclusion happens when people have access to a range of banking products at affordable prices. Group Lending: Group Lending happens when a group of people make a collective repayment promise. Sponsors: An individual who supports a borrower. I also want to remind you of a word you learned on last weeks podcast “Pledge”. Remember? To pledge means “to promise”.

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