Microfinance Industry Profile: Lebanon

This report profiles the sector, and analyzes the latest trends in the Lebanese microfinance industry.

Lebanon is one of the smaller microfinance markets in the Arab world. It is an upper middle-income country with a per-capita income of $5,800. The report states that:

• Lebanon is one of the top five microfinance markets in the Arab region;
• Political conflicts and instability have slowed down development of Lebanese microfinance;
• Lebanon has 23 microfinance programs, many of which charge subsidized interest rates and work according to sectarian objectives;
• MFIs have achieved national coverage, although they are concentrated in the capital city;
• Microfinance penetration is only 4% of total demand;
• Three large microfinance programs provide most of the microfinance services;
• Commercial banks have not downscaled into microfinance;
• MFIs are concentrated in rural areas and lend to men and women;
• Microcredit is the main product;
• Lebanon does not have a formal MFI network or a comprehensive microfinance law;
• Financing sources include local and international funders.

Finally, few studies have assessed the social impact of microfinance in Lebanon.