Beruflich Dokumente
Kultur Dokumente
Microfinance
Key Features
Lend to poor Do not take security Prefer saving over borrowing Small short term loan Cost converting interest rates Group appraisal and guarantee Prefer women customers over men
Microfinance
Riba (Haraam)
Allah has permitted trade and forbidden riba. (2:275) Allah will deprive riba of all blessing, but will give increase for deeds of charity: and Allah does not love the ungrateful and unjust. (2:276)
O believers, fear Allah and forgo the interest that is owing, if you really believe. (2:278) If you do not, beware of war on the part of Allah and His Apostle. But if you repent, you shall keep our principal. Oppress none and no one will oppress you. (2:279)
O Muslims, Do not devour riba, doubling and redoubling it and fear (the punishment) of Allah that you may be successful. (3:130) What you provide with the prospect of an increase through the property of (other) people, will have no increase with Allah; yet what you give in alms and charity, seeking the countenance of Allah, (will increase): it is these who will get a recompense multiplied. (30:39)
Islamic Microfinance
Opportunities
Muslim population
1.2 billion
Indonesia 129 million people are with incomes less than merely $2per day Bangladesh and Pakistan account for 122 million each followed by India at approximately 100 million Muslims below poverty line. According to survey conducted by Consultative Group to Assist the Poorest (CGAP) Islamic microfinance accounts for about 0.5% of global microfinance despite 1.2 billion Muslim population.
In 1988, 283 members of AIM were surveyed, 70% with significant increase in monthly household income from RM 142 to RM 220 per month. In 2005, AIM efficiency improved, as has been able to achieve 186% growth in monthly household income i.e. from RM 326 to RM 932.
Economic activities
Production
Construction/building materials (concrete blocks) Food (bakery, snack (nuts), fast food, traditional food Agriculture Furniture Jewellery Handicrafts (batik) Fishing /fishing equipment Cattle breeding (goat, cow) Ceramic (traditional ceramic vase) Manufacturing Traditional medicine
Trading
Cosmetics Direct selling (dinnerware, mattresses, etc) Jewellery (gold) Electronics (oven) Textiles and apparels Grocery items Newspapers Stationeries Scrap metal Paint products Cigarettes Health products Used cars
Services
Grass cutting Plumbing Laundry Car/motorcycle workshop Welding Sewing/tailoring Caf/food stall (burger)/drink stall (sugar cane, soy bean, roselle) Wedding accessories rental Barber/hair cut service Babysitting Food catering Children nursery Recycling products Cobbler Selling pre-paid card
Activity
Would you like to become entrepreneur? Would you like to invest in business generating halal income? Think of person who you know has skills but lack of funds.
Would you like to support such person financially and share profit with him / her?
Al Khidmat Video
Proposed Model
Advantages
Halal income for investors Poverty alleviation Promote entrepreneurship Facilitate home based industries Facilitate savings of the new entrepreneurs Objective is to attain self sustainable families
References
Allen & Overy LLP, Islamic Microfinance Report, 25 FEBRUARY 2009, International Development Law Organization Kiran Siddiqi, Potential of Islamic Microfinance in Pakistan, 2008 Mohammed Obaidullah, Introduction to Islamic Microfinance, IBF NET: The Islamic Business and Finance Network, 2008. Norma Md Saad, Selecting High-income Generating Activities for Microentrepreneurs: The Case Study of Amanah Ikhtiar Malaysia, International Journal of Humanities and Social Science, Vol. 1 No. 5; May 2011. Pakistan Microfinance Review 2010 (Annual Assessment of Industry), Pakistan Microfinance Network, Edited by Ali Shahrukh Pracha.