Micro Credit Law and Legal Definition
Micro credit is a very small financial loan made to impoverished people to help them start their own business. These individuals lack collateral, steady employment and a verifiable credit history and therefore cannot meet even the most minimal qualifications to gain access to traditional credit. It is a tool for socioeconomic development. Small Business Administration provides micro loans to help promote small businesses. These loans can be used as working capital or for the purchase of inventory, supplies, furniture, fixtures, machinery or equipment.