Performance of microfinance banks (MFB) has become an important issue among the scholars, practising managers and policymakers due to the important role of the MFB inthe nation‘s economic growth and development.Since they can serve as an alternative source of funds for the active poor and unbanked people. In spite of all these, the MFB in Nigeria has been reporting poor performance by days and this undermined the government efforts of breaking the cycle of the predominant poverty, unemployment, and economic stagnation right from the grassroots level. This study was set to examine the effect of entrepreneurial orientation and business model innovation on the performance of microfinance banks throughthe mediating role of IT-enabled dynamic capabilities. Cross-sectional research design was used to collect data from the respondents. The population of the study consists of microfinance banks through which the study used to draw the sample size. A PLS-SEM approach was used with aid of SmartPLS 3.2.8 to analyse the data. The result shows that both entrepreneurial orientation and business model innovation were significantly and positively related to the performance of MFB in Nigeria. The result also indicates that IT-enabled DCs mediates the effect of entrepreneurial orientation (EO), business model innovation (BMI) on organisational performance of microfinance banks. However, individually, the linear model has shown that among the three dimensions of EO,only proactiveness and innovativeness have a direct significant effect on organisational performance of MFB. The result did not indicate a significanteffect of competitive aggressiveness onthe performance of MFB. On the other hand, value creation, value proposition and value capture were significantly related to the organisational performance of MFB. At the mediation model, it was found that IT-enabled DCs mediates the effect of all the six antecedent constructs of proactiveness, innovativeness, competitive aggressiveness as well as value creation, value delivery and value capture on organisational performance of MFB in Nigeria. The finding of this study reveals that a high level of EO and BMI leads to a high level of organisational performance of MFB in Nigeria and IT-enabled DCs serves as a good mediator. This study recommends that MFB managers to continue to pursue initiatives that promote entrepreneurship and business model innovation in order to increase both breadth and depth of outreach to active poor and unbanked people thereby increasing their performance.This is the first study to combine the effect of EO, BMI and IT-enabled DCs on organisational performance of MFB. It is,therefore, contributes to the development of literature in this direction.