THE ROLE OF MICROFINANCE IN SUPPORTING SOCIAL ENTREPRENEURSHIP

Abstract

Microfinance plays a pivotal role in fostering social entrepreneurship by providing access to financial services for underserved communities. Social entrepreneurs, who aim to address societal challenges through innovative and sustainable business models, often face difficulties in securing traditional funding. Microfinance institutions bridge this gap by offering small loans, savings options, and financial literacy programs that empower these entrepreneurs to start and scale their ventures. This financial inclusion not only stimulates local economic development but also promotes social change by supporting enterprises that prioritize impact over profit. Furthermore, microfinance contributes to capacity building, gender empowerment, and community development, thereby creating an enabling environment for social entrepreneurship to thrive. This paper explores the synergies between microfinance and social entrepreneurship and highlights how tailored financial interventions can amplify the social and economic outcomes of entrepreneurial initiatives.