<PAGE>   1
                                FORM 10-Q/A NO. 1
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

         (Mark One)
         [X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                       SECURITIES AND EXCHANGE ACT OF 1934

                  FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1999

                                       OR

         [  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                       SECURITIES AND EXCHANGE ACT OF 1934

         For the transition period from ______ to ______

                           Commission File No. 1-14771

                           MICROFINANCIAL INCORPORATED
             (Exact name of Registrant as specified in its Charter)

         Massachusetts                                04-2962824
(State or other jurisdiction of           (I.R.S. Employer Identification No.)
 Incorporation or Organization)

                      950 Winter Street, Waltham, MA 02451
                    (Address of Principal Executive Offices)

                                 (781) 890-0177
              (Registrant's Telephone Number, Including Area Code)


         Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(b) of the Securities and Exchange act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. [X] Yes [ ] No

         As of July 15, 1999, 13,142,164 shares of the registrant's common stock
were outstanding.





<PAGE>   2


                           ITEM 1 FINANCIAL STATEMENTS
                           MICROFINANCIAL INCORPORATED
                           CONSOLIDATED BALANCE SHEETS
                                 (in thousands)


<TABLE>
<CAPTION>


                                                                              December 31,          June 30,
                                                                                  1998                1999
                                                                               ---------            ---------
                                                                               (AUDITED)           (UNAUDITED)
<S>                                                                           <C>                  <C>
                                     ASSETS

Net investment in leases and loans:
     Receivables due in installments                                           $251,060             $271,442
     Estimated residual value                                                    17,562               18,788
     Initial direct costs                                                         4,260                5,544
     Loans receivable                                                            12,253               20,960
     Less:
        Advance lease payments and deposits                                      (1,081)              (2,415)
        Unearned income                                                         (74,520)             (82,083)
        Allowance for credit losses                                             (24,850)             (24,471)
                                                                               -----------------------------
Net investment in leases and loans:                                            $184,684             $207,765
Investment in service contracts                                                   8,920               11,926
Cash and cash equivalents                                                         6,817               11,688
Property and equipment, net                                                       6,747                7,321
Other assets                                                                      3,086                5,912
                                                                               -----------------------------
          Total assets                                                         $210,254             $244,612
                                                                               =============================


                       LIABILITIES, REDEEMABLE CONVERTIBLE
                    PREFERRED STOCK AND STOCKHOLDERS' EQUITY

Notes payable                                                                  $130,421             $117,924
Subordinated notes payable                                                       24,421               12,712
Capitalized lease obligations                                                       774                1,203
Accounts payable                                                                    149                  285
Dividends payable                                                                   346                  534
Other liabilities                                                                 5,481                6,064
Income taxes payable                                                                625                  125
Deferred income taxes payable                                                    18,554               24,344
                                                                               -----------------------------
          Total liabilities                                                     180,771              163,191
                                                                               =============================

Commitments and contingencies                                                        --                   --
Redeemable convertible preferred stock (liquidation preference
     $12, at December 31, 1997 and 1998)                                             --                   --
Stockholders' equity:
     Common stock                                                                    99                  133
     Additional paid-in capital                                                   1,816               47,910
     Retained earnings                                                           27,956               35,469
     Treasury stock, at cost                                                       (138)              (1,946)
     Notes receivable from officers and employees                                  (250)                (145)
          Total stockholders' equity                                             29,483               81,421
                                                                               -----------------------------
          Total liabilities and stockholders' equity                           $210,254             $244,612
                                                                               =============================

</TABLE>



               The accompanying notes are an integral part of the
                        consolidated financial statements



                                       2



<PAGE>   3








                           MICROFINANCIAL INCORPORATED
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                      (in thousands, except per share data)





<TABLE>
<CAPTION>



                                                             For the quarters ended          For the 6 months ended
                                                                     June 30,                                June 30,
                                                                 1998           1999           1998           1999
                                                              ----------     -----------    ----------     ----------
                                                              (unaudited)    (unaudited)    (unaudited)    (unaudited)

<S>                                                            <C>            <C>            <C>            <C>
Revenues:
     Income on financing leases and loans                      $11,836        $13,661        $23,346        $26,038
     Income on service contracts                                   507          1,369            795          2,553
     Rental income                                               3,696          5,036          7,061         10,717
     Loss and damage waiver fees                                 1,331          1,399          2,726          2,795
     Service fees                                                1,089          2,246          2,620          4,063
                                                               ----------------------        ----------------------
          Total revenues                                        18,459         23,711         36,548         46,166
                                                               ----------------------        ----------------------

Expenses:
     Selling general and administrative                          5,063          5,708          9,345         11,712
     Provision for credit losses                                 3,698          6,064          8,273         11,463
     Depreciation and amortization                               1,274          1,767          2,451          3,455
     Interest                                                    3,131          2,366          5,951          4,985
                                                               ----------------------        ----------------------
          Total expenses                                        13,166         15,905         26,020         31,615
                                                               ----------------------        ----------------------


Income before provision for income taxes                         5,293          7,806         10,528         14,551
Provision for income taxes                                       2,160          3,263          4,284          6,039
                                                               ----------------------        ----------------------
Net Income                                                     $ 3,133        $ 4,543        $ 6,244        $ 8,512
                                                               ======================        ======================
Net Income per common share - basic                            $  0.32        $  0.34        $  0.64        $  0.67
                                                               ======================        ======================
Net Income per common share - diluted                          $  0.31        $  0.34        $  0.62        $  0.67
                                                               ======================        ======================
Dividends per common share                                     $ 0.035        $ 0.040        $ 0.065        $ 0.075
                                                               ======================        ======================


</TABLE>



               The accompanying notes are an integral part of the
                       consolidated financial statements.




                                        3




<PAGE>   4






                           MICROFINANCIAL INCORPORATED
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                      (in thousands, except per share data)



<TABLE>
<CAPTION>

                                                                           For the quarters ended         For the 6 months ended
                                                                                  June 30,                        June 30,
                                                                             1998           1999           1998           1999
                                                                           (unaudited)   unaudited)       (unaudited)  (unaudited)
                                                                           ------------------------       ------------------------

<S>                                                                          <C>           <C>           <C>            <C>
Cash flows from operating activities:
     Cash received from customers                                           $ 34,462       $ 38,446      $  65,721      $  76,727
     Cash paid to suppliers and employees                                     (8,765)       (12,642)       (15,718)       (19,058)
     Interest paid                                                            (2,570)        (2,089)        (5,554)        (4,984)
     Interest received                                                           233          1,040            443          1,856
                                                                            -----------------------      ------------------------
          Net cash provided by operating activities                           23,360         24,755         44,892         54,541
                                                                            -----------------------      ------------------------
Cash flows from investing activities:
     Investment in leased equipment                                          (20,151)       (28,285)       (37,378)       (49,520)
     Investment in direct costs                                               (1,214)        (2,050)        (1,971)        (3,029)
     Investment in service contracts                                          (1,909)        (2,343)        (3,682)        (4,188)
     Investment in loans receivable                                           (3,111)        (2,698)        (5,110)       (11,129)
     Investment in fixed assets                                                 (159)          (435)          (279)          (572)
     Issuance of notes from officers and employees                                 0             (1)          (144)            (2)
     Repayment of notes from officers                                             15              4             23            106
     Investment in notes receivable                                              (91)          (119)          (149)          (417)
     Repayment of notes receivable                                               114            115            174            202
                                                                            -----------------------      ------------------------
          Net cash used in investing activities                              (26,506)       (35,812)       (48,516)       (68,549)
                                                                            -----------------------      ------------------------
Cash flows from financing activities:
     Proceeds from secured debt                                               30,321         24,312         48,494         53,271
     Repayment of secured debt                                               (16,785)        (9,631)       (36,996)       (66,575)
     Proceeds from refinancing of secured debt                                58,500         65,452        108,000        159,000
     Prepayment of secured debt                                              (58,500)       (65,452)      (108,000)      (159,000)
     Proceeds from short term demand notes payable                               180            155            180            840
     Repayment of short term demand notes payable                               (217)            (3)          (217)           (29)
     Proceeds from issuance of subordinated debt                                   0              0          1,000              0
     Repayment of subordinated debt                                             (211)        (1,000)          (231)       (11,747)
     Proceeds from sale of common stock                                            0              0              0         46,116
     Proceeds from exercise of common stock options                               64             13            146             13
     Repayment of capital leases                                                (246)          (200)          (370)          (389)
     Purchase of treasury stock                                                    0         (1,808)             0         (1,808)
     Payment of dividends                                                       (296)          (466)          (590)          (813)
                                                                            -----------------------      ------------------------
          Net cash provided by (used in) financing activities                 12,810         11,372         11,416         18,879
                                                                             ----------------------      ------------------------
Net increase (decrease) in cash and cash equivalents:                          9,664            315          7,792          4,871
Cash and cash equivalents, beginning of period:                                7,380         11,373          9,252          6,817
                                                                            -----------------------      ------------------------
Cash and cash equivalents, end of period:                                   $ 17,044       $ 11,688      $  17,044      $  11,688
                                                                            =======================      ========================

Reconciliation of net income to net cash provided by operating activities:

     Net Income                                                             $  3,133       $  4,543      $   6,245      $   8,512
     Adjustments to reconcile net income to cash provided by
      operating activities:
        Depreciation and amortization                                          1,274          1,767          2,451          3,455
        Provision for credit losses                                            3,698          6,064          8,273         11,463
        Recovery of equipment cost and residual value, net of revenue
          recognized Net of Interest Income                                   13,058          9,627         23,857         25,163
        Increase (decrease) in current taxes                                       0              0              0           (500)
        Increase in deferred income taxes                                      2,129          3,014          4,237          5,789
     Change in assets and liabilities:
        Decrease (increase) in other assets                                     (728)          (357)          (664)            69
        (Decrease) increase in accounts payable                                  168            145             24            135
        Increase (decrease) in accrued liabilities                               628            (48)           469            455
                                                                            -----------------------      ------------------------
          Net cash provided by operating activities                         $ 23,360       $ 24,755      $  44,892      $  54,541
                                                                            =======================      ========================

Cash paid for income taxes                                                  $     40       $    267      $      80      $     797
                                                                            =======================      ========================
Supplemental disclosure of noncash activities:
     Property acquired under capital leases                                 $     31       $    606      $     214      $     819
     Accrual of common stock dividends                                      $    296       $    534      $     296      $     534


</TABLE>


               The accompanying notes are an integral part of the
                       consolidated financial statements.




                                       4






<PAGE>   5


                           MICROFINANCIAL INCORPORATED
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                (tables are in thousands, except per share data)
                                   (Unaudited)

(A)  Nature of Business:

MicroFinancial Incorporated ( the "Company") which operates primarily through
its wholly owned subsidiary, Leasecomm Corporation, is a specialized finance
company that primarily leases and rents commercial "microticket" equipment and
provides other financing services in amounts generally ranging from $900 to
$10,000 with an average amount financed of approximately $1,400 and an average
lease term of 45 months. The Company does not market its services directly to
lessees but sources leasing transactions through a network of independent sales
organizations and other dealer based origination networks nationwide. The
Company funds its operations primarily through borrowings under its credit
facilities, issuances of subordinated debt and on balance sheet securitizations.

(B)  Summary of Significant Accounting Policies:

Basis of Presentation:

The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles and the rules and
regulations of the Securities and Exchange Commission for the interim financial
statements. Accordingly, the interim statements do not include all of the
information and disclosures required for the annual financial statements. In the
opinion of the Company's management, the consolidated financial statements
contain all adjustments, consisting only of normal recurring adjustments,
considered necessary for a fair presentation of these interim results.
Inter-company accounts and transactions have been eliminated. For further
information, refer to the consolidated financial statements and notes included
in the Company's Annual Report and Form 10-K for the year ended December 31,
1998. The results for the three-month and six-month periods ended June 30, 1999
are not necessarily indicative of the results that may be expected for the full
year ended December 31, 1999.

The balance sheet at December 31, 1998 has been derived from the audited
financial statements included in the Company's Annual Report on Form 10-K for
the year ended December 31,1998.



                                        5




<PAGE>   6



Allowance for Credit Losses:

The Company maintains an allowance for credit losses on its investment in
leases, loans and service contracts at an amount that it believes is sufficient
to provide adequate protection against losses in its portfolio. The allowance is
determined principally on the basis of the historical loss experience of the
Company and the level of recourse provided by such leases, loans and service
contracts, if any. In addition, the allowance reflects management's judgment of
the additional loss potential considering future economic conditions and the
nature and characteristics of the underlying lease portfolio. The Company
determines the necessary periodic provision for the credit losses taking into
account actual and expected losses in the portfolio as a whole and the
relationship of the allowance to the net investment in leases, loans and service
contracts.

The following table sets forth the Company's allowance for credit losses as of
December 31, 1997 and, 1998 and June 30, 1999 and the related provision,
charge-offs and recoveries for the years ended December 31, 1998 and the quarter
ended June 30, 1999.

      Balance at December 31, 1997                                  $26,319
      Provision for credit losses                                    19,075
      Charge-offs                                 28,750
      Recoveries                                   8,206
                                                  -------

          Charge-offs net of recoveries                              20,544
                                                                    -------

      Balance at December 31, 1998                                  $24,850
      Provision for credit losses                                    11,463
      Charge-offs                                 19,651
      Recoveries                                   7,809
                                                  -------

          Charge-offs net of recoveries                              11,842
                                                                    -------
      Balance at June 30, 1999                                      $24,471








                                        6




<PAGE>   7


Earnings Per Share:

The Company has adopted Statement of Financial Accounting No. 128, "Earnings Per
Share." ("SFAS No. 128") which specifies the computation, presentation and
disclosure requirements for net income per share. Basic net income per common
share is computed based upon the weighted average number of common shares
outstanding during the period. Dilutive net income per common share gives effect
to all dilutive potential common shares outstanding during the period. Under
SFAS No. 128, the computation of dilutive earnings per share does not assume the
issuance of common shares that have an antidilutive effect on the net income per
share.

<TABLE>
<CAPTION>

                                                             FOR 3 MONTHS ENDED        FOR 6 MONTHS ENDED
                                                                   JUNE 30,                    JUNE 30,
                                                                   ---------                   --------
                                                             1998             1999      1998             1999
                                                             -----            ----      ----             ----

<S>                                                       <C>              <C>        <C>              <C>
         Net Income                                       $  3,133         $ 4,543    $  6,244         $  8,512
         Shares used in computation:
           Weighted average common shares
              outstanding used in computation
              of net income per common share             9,873,067      13,295,416   9,836,445       12,649,169
            Dilutive effect of redeemable
              convertible preferred stock                   19,600               0      19,600                0
            Dilutive effect of common stock
              options                                      146,951         237,953     175,037          162,302
         Shares used in computation of net
            income per common share -
            assuming dilution                           10,039,618      13,533,369  10,031,082       12,811,471
                                                        ----------      ----------  ----------       ----------


         Net income per common share                         $0.32           $0.34       $0.64            $0.67
         Net income per common share
               assuming dilution                             $0.31           $0.34       $0.62            $0.67


</TABLE>

Notes Payable:

On January 27, 1999 the Company amended and restated both of its revolving lines
of credit and term loan facilities whereby it may borrow a maximum of
$55,000,000 under each facility based upon qualified leases, loans and service
contracts. Outstanding borrowings with respect to the revolving line of credit
bear interest based either at Prime or London Interbank Offered Rate (LIBOR)
plus 1.75%. The prime rates at December 31, 1998 and June 30, 1999 were 7.75%.
The 90-day LIBOR rates at December 31, 1998 and June 30, 1999 were 5.28% and
5.3675% respectively.



                                        7




<PAGE>   8

The Company had borrowings outstanding under these agreements with the following
terms:

                          DECEMBER 31, 1998              JUNE 30, 1999
                          -----------------              -------------
     TYPE                RATE          AMOUNT         RATE          AMOUNT
     ----                ----          ------         ----          ------

     Prime              7.7500%       $ 6,515        7.7500%        $42,414
     LIBOR              7.4068%        15,000        6.8437%          5,000
     LIBOR              7.3939%        20,000        6.7700%         17,500
     LIBOR              7.1938%        10,001
     LIBOR              7.4103%         7,499
     Fixed              7.7500%         3,709        7.7500%            927
                                      -------                       -------

          Total Outstanding           $62,724                       $65,841
                                      -------                       -------

Outstanding borrowings are collateralized by leases, loans and service contracts
pledged specifically to the financial institutions. All balances under the
revolving lines of credit will automatically convert to a term loan on July 31,
2000 and September 30, 2000, respectively, provided the lines of credit are not
renewed and no event of default exists at that date. All converted term loans
are payable over the term of the underlying leases, loans and service contracts,
but in any event not to exceed 36 monthly installments. The most restrictive
covenants of the agreement have a minimum net worth and income requirement and
limit payment of dividends to no more than 50% of the consolidated net income,
as defined, for the immediately preceding fiscal year.

Initial Public Offering:

On February 5, 1999, the Company was admitted to the New York Stock Exchange
following its initial public offering of 4 million shares of common stock at $15
per share, 600,000 of which were sold by existing shareholders. The Company's
stock trades under the ticker symbol MFI. Total costs of $1,313,891 related to
the initial public offering offset the proceeds of $51,000,000. On June 12, 1998
the Company's Board of Directors authorized a two-for-one stock split which was
effective with the initial public offering. All share and per share amounts have
been restated to reflect this stock split.

In conjunction with the initial public offering in February 1999, the Board of
Directors of the Company authorized 5,000,000 shares of preferred stock, none of
which have been issued. Shares of such preferred stock may be issued from time
to time in one or more series and with such designations, voting powers,
preferences, and relative participating optional or other special rights, and
qualifications, limitations, and restrictions on such rights as the Board of
Directors may authorize.

                                        8



<PAGE>   9


Stock Options:

Under the 1998 Equity Incentive Plan (the "1998 Plan") which was adopted on July
9, 1998 the Company had reserved 2,000,000 shares of the Company's common stock
for issuance pursuant to the 1998 Plan. On February 25, 1999 and April 12, 1999
the Company granted a total of 750,000 and 80,000 stock options respectively at
prices of $12.313, $13.544 and $13.125, which were the fair market values on the
date of grants, to various members of management and board of directors.

Dividends:

On June 19, 1999 the Company's Board of Directors approved a dividend of $.04
per common share for all outstanding common shares as of June 30,1999 to be paid
on July 15, 1999.



                                       9




<PAGE>   10





                                   SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

                              MicroFinancial Incorporated



                              By: /s/ Peter R. Bleyleben
                                  ---------------------------------------------
                                  President and Chief Executive Officer

                              By: /s/ Richard F. Latour
                                  ---------------------------------------------
                                  Executive Vice President, Chief
                                  Operating and Chief Financial Officer

Date:  August 11, 1999






                                       10