Available financing resources for Islamic microfinance institutions to alleviate poverty: cash waqf approach
Islamic microfinance is considered an important element of economic prosperity and an instrument in reducing poverty rates in the Islamic world. However, the Islamic Microfinance industry faces many problems in its efforts to serve the community. One of these problems is the lack of financing resour...
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| Main Authors: | , |
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| Format: | Conference or Workshop Item |
| Language: | English English |
| Published: |
2020
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| Subjects: | |
| Online Access: | http://irep.iium.edu.my/84663/1/84663_Available%20financing%20resources.pdf http://irep.iium.edu.my/84663/2/84663_Available%20financing%20resources.certificate.pdf http://irep.iium.edu.my/84663/ https://www.iium.edu.my/institute/iiibf/online-conference-isfpcps-september-2020 |
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| Institution: | Universiti Islam Antarabangsa Malaysia |
| Language: | English English |
| Summary: | Islamic microfinance is considered an important element of economic prosperity and an instrument in reducing poverty rates in the Islamic world. However, the Islamic Microfinance industry faces many problems in its efforts to serve the community. One of these problems is the lack of financing resources. This research aims to investigate the current Islamic financing channels that are used to finance Islamic microfinance institutions and determine the appropriate mechanisms or models practiced by Islamic microfinance institutions to finance the micro-enterprises and therefore reduce the poverty rate in Muslim communities. This research applied a qualitative research approach by reviewing the current literature on the Islamic microfinance industry. This research focused on Cash Waqf as an alternative channel to finance Islamic microfinance institutions as this model has been successfully implemented and experienced by many Islamic countries in the world, to deal with various social problems and poverty alleviation. The desired development can be achieved by investing Cash Waqf funds in micro-enterprises that may help to maximize investment returns and improve low-income people’s returns, as well as enhance economic development to a directly impact poverty alleviation. It has been found that the Cash Waqf model is considered an appropriate source of funding to finance Islamic microfinance instigations that finally will utilize the Cash Waqf fund to finance micro-enterprises through several models such as Mudarabah, Murabaha, Musharakah Mutnaqisah and Qard Hassan. The four models were discussed after merging them with the concept
of Cash Waqf through the previous literature, weighing the advantages and disadvantages of each one of them, and proposing some solutions that could contribute to solving the problems faced by the micro-enterprises. |
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