Islamic Microfinance: A Solution to Expand Financial Inclusion?
The global Muslim population counts about 2 billion people but over 70% of them, living in Muslim majority countries as Indonesia, Malaysia, Pakistan, Bangladesh or Sudan, do not use formal financial services. Despite the expansion of institutions providing credit and loan services in developing countries, still only 0.5% of global microfinance institutions offer the services and products responding to Islamic financing principles (CGAP survey, 2008). In the context of an evident huge demand for the expansion of these financial products and services, the development of Islamic microfinance is still in its infancy. As this tool has the potential to serve currently unbanked, how can the Islamic microfinance sector reach the scale required?
Date: Wednesday, December 14, 2016