Abstract

This study examines the relationship of microfinance, inequality and vulnerability by providing a cross-country empirical study of 11 developing countries in Central Africa. Microfinance plays an important role in the financial market in many African countries. Although microfinance is expected to significantly affect macro variables, we lack enough empirical research on impact analysis at the macro level, such as the effect of microfinance on inequality and vulnerability. Results indicate that the number of microfinance institutions has a negative impact on the Gini index in Central Africa countries. When the microfinance institutions in the country become dense, inequalities decrease.

Key words: Microfinance, inequality, vulnerability, cross-country analysis.