"Microfinance is an economic development tool whose objective is to assist the poor to work their way out of poverty. It covers a range of services, which include, in addition to the provision of credit, many other services such as savings, insurance, money transfers, counseling etc".
This definition of microfinance is given by Malegam Committee – Sub-Committee of the Central Board of Directors, Reserve Bank of India which was formed to Study Issues and Concerns in the Microfinance Sector.