Microcredit has been promoted as a way to help the poor start businesses and lift themselves out of poverty. However, recent evidence from randomized evaluations in several countries finds that: 1) The majority of poor households do not want or use microloans to start businesses, but rather for consumption needs like durables, ceremonies, or health emergencies. 2) Microcredit has limited impact on creating new businesses, but can help expand existing ones. However, average household income and consumption do not significantly increase. 3) The poor operate very small, informal businesses like petty retail with no employees or assets. They view these businesses as a fallback rather than a path out of poverty. Microcredit alone is not enough