40h
Intermediate
IsMF4D: Islamic Microfinance for Development

Islamic societies are characterized by high and rising levels of poverty and financial exclusion. Financial exclusion is aggravated by failure on the part of conventional microfinance programs in giving due importance to the religious sensitivities of Muslims. For poverty alleviation efforts to succeed in these societies, there is need for an appropriate model that is rooted in Islam and conforms to beliefs, cultures of the Muslim clients.

This course aims to provide the participants with a comprehensive understanding of the building blocks of a microfinance program targeted at Islamic societies. It asserts that there are no fundamental contradictions in the objectives of global microfinance programs and of the glorious Islamic Shariah, though the methodology of latter may have certain distinct characteristics. The course seeks to present the Islamic approach as a composite and compassionate one that is rooted in charity, but permits wealth creation and for-profit enterprise. Spanning over five units, it focuses on the mechanisms, models, tools and instruments of the Islamic approach as prescribed by the glorious Shariah.

The course covers the following major areas in five modules:

1. Microfinance and Objectives (Maqasid) of Shariah: This module presents comprehensive human development in general and poverty alleviation in particular as the key global policy objective. This is discussed both in the context of the objectives (Maqasid) of the Shariah and that of the UN-mandated sustainable development goals (SDGs). The module presents the Islamic approach to poverty alleviations, carefully comparing the same with a diverse range of models of conventional microfinance that have historically been tried in various parts of the globe. By posing some serious challenges to the conventional models of intervention, the stage is set for solutions within the domain of Islamic economics and finance.

2. Modes and Models of Islamic Microfinance (For-Profit): This module undertakes a comprehensive review of available models of Islamic microfinance, which ithat use conventional methodology with Islamic products as well as the ones that are purely indigenous. It focuses on models that use Islamic sale-based modes, such as, murabaha and bai-bithaman-ajil or bai-muajjal, bai-salam, bai-istijrar, bai-istisna and lease-based modes, such as, ijara and ijara-muntahyya-bit-tamleek. It also covers the participatory modes, such as, mudarabah, musharakah and their variants.

3. Modes and Models of Islamic Microfinance (Altruistic & Not-for-Profit): This module undertakes a comprehensive review of models of Islamic microfinance, which use altruism-based modes (based on zakah, sadaqa and waqf); not-for-profit modes (qard al-hasan, kafala). It also covers the composite or blended models that includes both altruistic, not-for-profit as well as for-profit mechanisms,

4. Performance Evaluation & Regulation of Islamic MFIs: This module teaches how to identify the outcomes and impacts of Islamic microfinance project(s) and MFIs. It also familiarizes the student with the framework to monitor the financial, social, as well as Shariah performance of Islamic MFIs. It provides a comprehensive understanding of the regulatory concerns relating to IsMFI sector and an overview of IsMF regulations across the globe.

5. Case Studies in Islamic Microfinance: This module comprises several case studies that highlight some good practices in Islamic microfinance at the micro, meso and macro levels. The case studies highlight a wide range of Islamic microfinance possibilities in multiple regions, sectors as well as legal and regulatory environments.

Topics for this course

Getting to Know the Learning Environment
This module seeks to famiiarize the participant with the online learning environment

  • Introduction to this Course
  • More on Learning Environment
  • Program Structure
  • Grading Policy
  • Before We Start…
  • Glossary of Arabic Terms

Microfinance and Comprehensive Human Development
This module presents comprehensive human development in general and poverty alleviation in particular as the key global policy objective. This is discussed both in the context of the objectives (Maqasid) of the Shariah and that of the UN-mandated sustainable development goals (SDGs). The module presents the Islamic approach to poverty alleviation, carefully comparing the same with a diverse range of models of conventional microfinance that have historically been attempted in various parts of the globe. By posing some serious challenges to the conventional models of intervention, the stage is set for solutions within the domain of Islamic economics and finance.

  • Module Introduction: Microfinance and Comprehensive Human Development
  • Poverty Alleviation as a Development Goal
  • Pop Quiz on Maqasid Al-Shariah
  • Islamic Approach to Alleviating Poverty
  • Pop Quiz (Charity and Economic Empowerment)
  • Financing the Poor
  • Pop Quiz (Financial Services for the Poor)
  • Conventional Models of Microfinance – I
  • Pop Quiz (Conventional MF Models – I)
  • Conventional Models of Microfinance – II
  • MF Principles, Issues and the Islamic Alternative
  • Pop Quiz (Conventional MF Models – II)
  • MCQ-Test (Microfinance and Comprehensive Human Development)

Islamic Modes and Models of Microfinance (For-Profit)
This module undertakes a comprehensive review of models of Islamic microfinance, which use for-profit modes (Islamic debt, lease and equity). The coverage includes models that use conventional methodology with Islamic products and are essentially replications of the mainstream conventional microfinance experiments.

  • Module Introduction – Islamic Models of Islamic Microfinance (For-Profit)
  • Overview of Modes and Models of IsMF
  • Pop Quiz: Overview of Islamic MF Modes and Models
  • Modes and Models of IsMF (Murabaha)
  • Pop Quiz – (Murabaha)
  • Mode and Models of IsMF (Salam)
  • Pop Quiz (Salam)
  • Modes and Models of IsMF (Ijarah)
  • Pop Quiz (Ijarah)
  • Modes and Models of IsMF (Diminishing Musharakah)
  • Pop Quiz (Diminishing Musharakah)
  • Modes and Models of IsMF (Musharakah)
  • Pop Quiz (Musharakah)
  • Modes and Models of IsMF (Mudarabah)
  • Pop Quiz (Mudarabah)
  • MCQ – Islamic Modes and Models of MF (For Profit)

Islamic Modes and Models of Microfinance (Altruistic and Not-for-Profit)
This module undertakes a comprehensive review of modes and models of Islamic microfinance, which use altruism-based modes (based on zakah, sadaqa and waqf); not-for-profit modes (qard al-hasan, kafala) and composite models using all forms if Islamic microfinance. The coverage includes models that are purely indigenous, e.g. the Iranian qard funds and the Indonesian baitul-mal-wat-tamweels.

  • Module Introduction – Islamic Modes and Models of Microfinance (Altruistic, Not-for-Profit and Composite)
  • Modes and Models of IsMF (Qard al-Hasan)
  • Pop Quiz (Qard)
  • Modes and Models of Islamic MF (Zakat) – I
  • Pop Quiz (Islamic Modes and Models -Zakat -I
  • Modes and Models of Islamic MF (Zakat) – II
  • Pop Quiz (Islamic Modes and Models – Zakat- II)
  • Modes and Models of Islamic MF (Waqf)
  • Pop Quiz (Waqf)
  • Composite Models of Islamic Microfinance
  • MCQ – Islamic Modes and Models of MF (Altruistic and Not-for-profit)

Performance Evaluation, Policies and Regulation of Islamic Microfinance Institutions
This module provides a comprehensive analysis of the tools and methodologies for undertaking impact assessment and evaluating the performance of Islamic MFIs from the financial, social and Shariah point of view. It also undertakes a comparative analysis of laws, regulations, policies and standards relating to management of Islamic microfinance projects and institutions.

  • Module Introduction: Performance Evaluation, Standards and Regulation
  • Impact Assessment of Islamic MFIs
  • Monitoring Financial Performance
  • Quiz- Financial Performance of IsMFIs
  • Monitoring Social Performance
  • Monitoring Shariah Performance
  • Submission – Shariah Performance
  • Policy & Regulatory Concerns relating to Islamic MF Sector
  • Overview of IsMF Policies & Regulations
  • MCQ – Performance Evaluation and Regulation of IsMFIs

Case Studies in Islamic Microfinance
This module comprises several case studies that highlight some good practices in Islamic microfinance at the micro, meso and macro levels. The case studies highlight a wide range of Islamic microfinance possibilities in multiple regions, sectors as well as legal and regulatory environments.

  • Dompet Duafa Republika, Indonesia
  • Akhuwat Pakistan
  • Wasil Foundation, Pakistan
  • Rural Development Scheme (RDS), Bangladesh
  • Amanah Ikhtiar Malaysia
  • Fael Khair, Bangladesh
  • Baitul Mal wat Tamweel (BMT) Dana Ukhuwwa, Indonesia
  • IRADA Microfinance, Sudan
  • Al-Anaam Microfinance, Sudan

Requirements

  • This course is open to applicants with at least 2 years of university education. Those with relevant work experience may be exempted from the above academic requirement.
$550
What I will learn?
  • Topics covered in the program cover a wide range of experiments to alleviate poverty, as micro finance has evolved over time and its marriage with Islamic finance to address faith-related concerns in countries or regions with significant Muslim population.
  • Islamic microfinance has been growing steadily in its depth and outreach. It is getting traction from the traditional Islamic organizations as well as international development agencies. Be part of this ever-evolving sunrise sector as a certified professional in Islamic microfinance.
  • You can use designatory letters CeIMF (Certified in Islamic Microfinance) upon successful completion of the program.
  • You will be pleasantly surprised to interact with our experts as you proceed along your short journey. They come from some of the best-known institutions in the field across the globe.