Microfinance institutions (MFIs) have emerged as significant players in the development landscape of Ethiopia, particularly for women entrepreneurs who face systemic challenges to accessing financial resources. A qualitative research design was employed, utilising in-depth interviews with a purposive sample of women entrepreneurs who have utilised MFI services. The data were analysed using thematic analysis. Interviews revealed that MFIs not only provided financial support but also played a crucial role in enhancing the confidence and decision-making abilities of female entrepreneurs. MFIs contribute to gender empowerment by fostering economic independence among Ethiopian women through strategic interventions aimed at addressing traditional gender barriers. Policy makers should recognise the importance of MFIs as enablers for gender equality and advocate for regulatory frameworks that support their growth and effectiveness.