The paper sought to study Microfinance Banking activities in Nigeria and its geographical location. Microfinance Banks are believed to be engines of robust economic growth, agents of rural transformation and poverty reduction. The objectives of this study are to analyze the distribution pattern of these Banks and to determine the extent to which poverty levels define the existence of these Banks. The methodology adopted for the research is content analysis. Findings in the study suggest that needs of the sector do not determine the distribution pattern. Regions and States with lower rates of poverty have a higher concentration of these Banks whereas regions and states with higher poverty rates have the lowest investment in this sector. It is concluded that the extreme poverty is a leading cause as to why the potentials are not adequately tapped in the rural areas. It is recommended that the government step in to promote the sector directly and gradually divest its holdings such that full benefits can be harnessed.