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                                                                     EXHIBIT 5.1




                                                  July 31, 1998


MicroFinancial Incorporated
950 Winter Street, Suite 41000
Waltham, Massachusetts  02154


Ladies and Gentlemen:

         We have examined the Registration Statement on Form S-1 (the
"Registration Statement") filed by MicroFinancial Incorporated (the "Company")
with the Securities and Exchange Commission on the date hereof in connection
with the registration under the Securities Act of 1933, as amended, of 4,600,000
shares of common stock, $0.01 par value (the "Common Stock").

         In connection with this opinion, we have examined the following
documents and records:

         (1)      The Restated Articles of Incorporation of the Company, as
amended to date;

         (2)      The By-Laws of the Company, as amended to date;

         (3)      Specimen certificate of the Common Stock; and

         (4)      All corporate minutes and proceedings of the Company relating
to the issuance of the Common Stock being registered under the Registration
Statement.

         We have also examined such further documents, records and proceedings
as we have deemed pertinent in connection with the issuance of the Common Stock.
In our examination, we have assumed the genuineness of all signatures, the legal
capacity of natural persons, the completeness and authenticity of all documents
submitted to us as originals, and the conformity to the originals of all
documents submitted to us as certified, photostatic or conformed copies, and the
validity of all laws and regulations. We also are familiar with the additional
proceedings proposed to be taken by the Company in connection with the
authorization, registration, issuance and sale of the Common Stock.

         We are qualified to practice law in the Commonwealth of Massachusetts
and we do not purport to express any opinion herein concerning any law other
than the laws of the Commonwealth of Massachusetts and the federal law of the
United States.



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MicroFinancial Incorporated
July 31, 1998
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         Based upon such examination, subject to the proposed additional
proceedings being duly taken and completed as now contemplated by the Company
prior to the issuance of the Common Stock, it is our opinion that the Common
Stock, when issued and paid for, will be legally issued, fully paid and
non-assessable.

         We consent to the use of this opinion as an exhibit to the Registration
Statement and to the references to our firm in the Prospectus which is part of
the Registration Statement.




                                               Very truly yours,


                                               /s/ Edwards & Angell, LLP
                                               
                                               Edwards & Angell, LLP