Final answer:
The first Microfinance Bank was established in Bangladesh, specifically the Grameen Bank, which played a critical role in the country's economic development through the provision of microcredit.
Step-by-step explanation:
The first Microfinance Bank was established in Bangladesh. This initiative was a part of the microcredit movement, which was started by Muhammad Yunus who founded the Grameen Bank in 1983. Microfinance banks, like the Grameen Bank, provide small loans, known as microcredit, to the impoverished without requiring collateral. This approach has been instrumental in advancing the economic development of Bangladesh by empowering individuals to start businesses, thereby reducing poverty and encouraging self-sufficiency. The Grameen Bank model is known globally as the “grassroots” of microfinance models. It originated in Bangladesh by Professor Mohammed Yunus during the early 1970s.