Microfinance initiatives have been introduced in various African countries to address poverty and economic disparities. In Uganda, these programmes are often targeted at informal urban markets where women play a crucial role in livelihoods. The study employs a combination of qualitative and quantitative research methods, including interviews with microfinance clients, surveys of market participants, and document analysis of microfinance records. This theoretical framework underscores the potential of microfinance to catalyze economic growth in Ugandan informal urban markets, particularly for women entrepreneurs. Future research should focus on developing more sustainable financial mechanisms that address existing constraints. Policy recommendations include advocating for regulatory reforms that reduce interest rates and increase access to collateral-free lending options for female entrepreneurs.