Given the growing urgency of combating poverty in the 21st century, this paper discusses the value of promoting microfinance as a development tool, namely the Grameen Bank model, to engender a more inclusive, participatory and most importantly, sustainable approach to international development. This paper contextualizes the role and value of microfinance in the international development discourse and assesses the importance of social capital formulation in poverty alleviation, especially as it relates to microfinance. Social capital (networks, trust, norms) has become an increasingly salient subject across disciplines (sociology, economics, political science, etc.) with considerable implications for the social and economic development of societies, particularly in the developing world. This paper suggests that while microfinance may not reduce overall poverty outright, the pioneering model of the Grameen Bank, which depends upon peermonitoring networks, group trust, and solidarity, can create valuable stocks of social capital contributing to transformative social development.