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The Islamic Business and Finance Network (IBF Net), a global network of students, researchers, and finance professionals, and its Institute of Microfinance and Development together with Islamic Relief Worldwide, an international development and relief organization, held an international training program and workshop to discuss the nuances of Islamic microfinance was recently held in New Delhi. The program was attended by over sixty participants from the corporate sector, NGOs, and academics from India, Bangladesh, Sri Lanka and Afghanistan.
The poor in Islamic countries stand to benefit from access to financial services just as the poor in other societies. However, Muslim borrowers also require that their microfinance products and services are Shariah-compliant. Shariah, or Islamic law, prohibits the payment of fees for the renting of money (interest, usury, or riba) or for specific terms (for instance, late fees), as well as investing in businesses that are contrary to the principles of Islam. Instead, Shariah-compliant financial institutions use profit sharing, safekeeping, joint venture, cost plus, or leasing models of providing the poor with financial services.
The workshop’s sessions covered major norms and models of Islamic microfinance supplemented by practical insights from case studies. The sessions were conducted by a team of experts under the leadership of Dr Mohammed Obaidullah, Senior Economist at the Jeddah-based Islamic Development Bank (IDB) and Dr Ausaf Ahmad, Former Senior Economist at IDB and President, IBF Net. Mr. Obaidullah released a book, Introduction to Islamic Microfinance, at the event. The roster of speakers over the course of the program comprised a who’s who of Islamic microfinance professionals and organizations including Danish Aziz of Islamic Relief Worldwide; Amjad Saleem, a Country Director with Muslim Aid Sri Lanka, a UK-based international relief and development agency, Mohamed Hannan, a Consultant for Muslim Foundation for Cultural and Social Development Sri Lanka, Dr Prabahakar, Founder and CEO of Society for Rural Improvement (SRI), Abdur Raquib, Convenor with Islamic Finance Institute of India and KK Ali, CEO of Alternative Credit and Investments Limited (AICL). Other prominent NGOs that participated in the events were Microfinance Investment Support Facility for Afghanistan (MISFA), Zakat Foundation of India, Ajmal Foundation, a public charitable trust, Care India, an independent humanitarian organization, and Wind Trust.
Islamic Relief, founded in the UK in 1984, has offices in Afghanistan, Albania, Bangladesh, Bosnia, Chechnya, China, Egypt, Kosova, Indonesia, Mali, Pakistan, Palestine, Sudan, Ethiopia, Jordan, Kenya, India, Iraq, Somalia, and Yemen. By the end of 2007, Islamic Relief had total incoming resources of GBP 40 million.
IBF Net is an India-based global network with over 5,000 members from academia and the Islamic financial services industry. It offers professional certification programs in the field of Islamic finance through its online academy, International Institute of Islamic Business and Finance.
IBF Net plans to organize similar events in other cities in the near future.
By Iyanna Holmes, Research Assistant
Additional Resources:
Islamic Business and Finance Network
