The microfinance revolution has allowed more than 150 million poor people around the World to receive small loans without collateral, build up assets, and buy insurance. This book offers an accessible and engaging analysis of the global expansion of financial markets in poor communities. It introduces readers to the key ideas driving microfinance, integrating theory with empirical data and addressing a range of issues, including savings and insurance, the role of women, impact measurement, and management incentives. This second edition has been updated throughout to reflect the latest data, with new material on commercialization, credit contracts, savings and insurance, gender, impact measurement, and governance. Appendixes and problem sets cover technical material.