Housing in the developing world is a process. Families might replace a dirt floor with a clean, hard surface. They might reinforce the walls or the roof to prevent water from seeping through the cracks when it rains. They might build an additional room after welcoming a new child into the world. This method of improving housing one step at a time is called “incremental” or “progressive building” and accounts for up to 90 percent of residential construction in the developing world. Families build their homes bit by bit as needs change and resources become available. When microfinance emerged as a means of alleviating poverty by increasing access to capital for low-income populations, many saw it as the new frontier in international development. Traditional banks refused to lend such small amounts for the simple reason that it was far less profitable. The bank would have to spend the same amount of time and money to process a tiny loan as a large loan (sometimes more, especially if the borrower has informal income) and would receive far less in return. Microfinance provided an alternative financing avenue for millions of people who lacked access to traditional banking, giving them a chance to invest in their small business or income-generating project. Microfinance worked because it responded to the needs of those in the informal economy. Informal-sector cash flows are generally characterized by small sums of money and a quick turnover rate, a cycle that does not adapt well to the formal banking system. Muhammad Yunus, a Bangladeshi economist, saw this pattern and developed the concept of microcredit to support the practices of informal sector micro business cycles. Yunus demonstrated that people living in poverty, especially women, have surprisingly high rates of loan repayment. The microfinance movement led to more than 200 million people gaining access to previously unavailable financial services. As a result, innovative institutions sustainably provide these services to millions of the world’s poor. Services now reach beyond just small-business credit to include savings, remittances, insurance and education finance.