The strength of microﬁnance

Microﬁnance is a CEB priority under its Strategic Framework 2023-2027 and a key instrument for promoting ﬁnancial and social inclusion across Europe. It can support income-generating activities by promoting entrepreneurship and self-employment, while improving living conditions in low-income households, with positive spillovers for access to education and healthcare.

The CEB’s main approach is to support start-ups and microenterprises, through specialised microﬁnance providers that focus on serving people that are excluded from mainstream banking, such as migrants and refugees, women, rural populations and young people. The CEB works mainly with smaller, specialised microﬁnance providers that do not collect deposits and therefore require access to external ﬁnancing. Such ﬁnancing can be difficult or expensive to obtain from ﬁnancial institutions, partly because lending to microﬁnance providers is cost-intensive. This is due to the relatively small loan sizes and the higher perceived risk of the sector. The Social Impact Account and EU instruments, such as the InvestEU guarantee and ESF+, are key because they provide this support (see the InvestEU highlight). They enable the CEB to provide ﬁnancing to microﬁnance providers, and help them bridge a wide microﬁnance gap, estimated at around €13 billion in the EU, while mitigating risks. For a practical example blending loan and grant ﬁnancing, read about CEB’s microﬁnance work in Albania under Projects approved in 2025.

Beyond ﬁnancing and other support, the CEB promotes impact measurement and engagement with the microﬁnance sector and with InvestEU backing, it launched an interactive Social Impac t Measurement Toolkit in October to help microﬁnance providers assess and improve the impact of their work.

The toolkit is further testimony of the CEB’s commitment to deliver measurable results by strengthening the microﬁnance sector’s ﬁnancial resilience, building knowhow and institutional capacity, and supporting access to ﬁnance for vulnerable people.