Many researchers have attempted to define and research social capital, with little practical application available.

In its most general form, social capital is the value that is contained in relationships, much like physical capital is the value contained in tangible objects.

The value found in social capital is the basis of collateral in many microfinance lending models, in which social collateral— the value that people place upon the relationships they have in their community— replaces traditional forms of collateral such as mortgages.

However, a quantitative analysis of social capital is necessary in order to properly value and use social capital as collateral. Network analysis is the only mathematical way of quantifying social capital within a community, through its analysis of network structure.