Microenterprise

AAA

DEFINITION of 'Microenterprise'

A small business that employs a small number of employees. A microenterprise will usually operate with fewer than 10 people and is started with a small amount of capital. Most microenterprises specialize in providing goods or services for their local areas.

INVESTOPEDIA EXPLAINS 'Microenterprise'

Microenterprises serve a vital purpose in improving the quality of life for people in developing countries. Microfinance seeks to help microenterprises by loaning small amounts of capital to these businesses. This allows poor individuals or families to start their own businesses, earn income and benefit their communities.

For example, a woman in a developing country may use microcredit to take out a loan and purchase a sewing machine. She could use the machine to establish a microenterprise that specializes in tailoring. The woman would increase her wealth and help her community by providing a service.

RELATED TERMS
  1. Small Office/Home Office - SOHO

    A business that is operated out of a business owner's residence ...
  2. Microinsurance

    Insurance products that offer coverage to low-income households. ...
  3. Community Development Financial ...

    A private sector financial institution that focuses on personal ...
  4. Microeconomics

    The branch of economics that analyzes the market behavior of ...
  5. Microcredit

    An extremely small loan given to impoverished people to help ...
  6. Microfinance

    A type of banking service that is provided to unemployed or low-income ...
Related Articles
  1. Microfinance: What It Is And How To ...
    Entrepreneurship

    Microfinance: What It Is And How To ...

  2. An Introduction to Microfinance
    Insurance

    An Introduction to Microfinance

  3. Social Finance Careers: Creating A Better ...
    Entrepreneurship

    Social Finance Careers: Creating A Better ...

  4. Go Green With Socially Responsible Investing
    Personal Finance

    Go Green With Socially Responsible Investing

Hot Definitions
  1. Conduit Issuer

    An organization, usually a government agency, that issues municipal securities to raise capital for revenue-generating projects ...
  2. Financing Entity

    The party in a financing arrangement that provides money, property, or another asset to an intermediate entity or financed ...
  3. Hyperinflation

    Extremely rapid or out of control inflation. There is no precise numerical definition to hyperinflation. Hyperinflation is ...
  4. Gross Rate Of Return

    The total rate of return on an investment before the deduction of any fees or expenses. The gross rate of return is quoted ...
  5. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
  6. Leading Indicator

    A measurable economic factor that changes before the economy starts to follow a particular pattern or trend. Leading indicators ...
Trading Center