Developing the potential of Islamic social finance
Developing the potential of Islamic social finance
Since 1994 we have provided life-changing Islamic microfinance to disadvantaged people who are typically unable to access conventional financial services. With our interest-free Shariah-compliant loans, those we lend to can start up or expand a small business or farm – lifting themselves out of poverty. This year our multi-million-pound loan portfolio helped over 31,000 people in six countries, taking the total social investment circulated since inception to over £65 million.
In Niger, our innovative finance solutions have helped women improve their economic situation. With our support, they rear goats and sheep for qurbani and benefit from links to the best livestock markets when selling the animals. The trailblazing Qurbani Plus model ensures that women and their families earn as much as possible in return for their hard work. Some have used their share of the profit to buy their own livestock or set up a kitchen garden, creating a sustainable source of income. They can also invest in nutrition, healthcare and education for themselves and their families. Islamic Relief re-invests our share of the profit into livestock so that more people can be helped out of poverty.
To improve poor people’s resilience to shocks and provide financial protection we have created a safety net for communities affected by or at risk from natural disasters. In Bangladesh, for example, Islamic Relief offers Shariah-compliant takaful insurance, meaning individuals make regular contributions into a collective fund instead of paying a premium to a company. In the event of a loss of members’ livelihood assets such as livestock or a debilitating accident or an adverse weather event, they receive a pre-defined pay out. Investing any surplus has ensured the community insurance scheme has been able to run for over five years.
Eunice is a member of Nitunze Nikufae Women’s Group, one of 20 loans and savings groups created by Islamic Relief in Mandera and Kilifi, Kenya. Supported to register their group and open a bank account, the 30 women members also received training in savings and loans, running the group, and entrepreneurship. With a collective savings pot and a strong financial education behind them, the group bought an acre of land and are saving up to install irrigation so they can farm together. The small loans administered by the group also enable members to feed their families, send their children to school, and invest in small income-generating activities.
