We investigate whether the microfinance institution (MFI) is able to charge unduly high lending rates and obtain a profitability incompatible with perfect competition. We use a global panel data set of MFIs. The Panzar and Rosse revenue test is employed together with institutional background variables for the various MFIs. We find that the MFIs are unable to charge high lending rates and that profitability responds to changes in input prices, although the MFI has some pricing power due to its monopolistic competitive condition.