Tagged: CGAP

A National Experiment: Sharia-Compliant Finance in Sudan

A National Experiment: Sharia-Compliant Finance in Sudan

<p>In Sudan, Sharia-compliant microfinance is the government-mandated rule, not the exception. That&rsquo;s because the country&rsquo;s banking system went fully Islamic in the 1980s, legislating Sharia principles. In 2007, the Central Bank of Sudan established a dedicated microfinance unit to foster a conducive policy environment, a regulatory framework, and the intellectual, human, and financial capital to provide those services effectively. Moreover, the Central Bank introduced various Shariah-compliant products, such as musharaka, mudaraba, salam financing and istisna, to meet specific needs of potential customers. Banks were required to channel at least 12% of their total loan portfolio toward microfinance clients. Out of this have emerged several exciting programs that are offering early evidence that the country&rsquo;s strategy is paying off.</p>
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<p><a href="http://www.cgap.org/blog/national-experiment-sharia-compliant-finance-sudan?utm_source=feedburner&amp;utm_medium=feed&amp;utm_campaign=Feed%3A+cgap%2FUaRp+%28Prod+-+CGAP+Microfinance+Blog%29" title="http://www.cgap.org/blog/national-experiment-sharia-compliant-finance-sudan?utm_source=feedburner&amp;utm_medium=feed&amp;utm_campaign=Feed%3A+cgap%2FUaRp+%28Prod+-+CGAP+Microfinance+Blog%29">http://www.cgap.org/blog/national-experiment-sharia-compliant-finance-su…</a></p>
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Sharia-Compliant Finance for MSMEs in Algeria

Sharia-Compliant Finance for MSMEs in Algeria

Algeria hopes to stem high unemployment rates among its young population by promoting the development of micro, small and medium sized enterprises (MSMEs). Key to that effort, of course, is the provision of financial services. Therefore, the Algerian g…

Islamic Microfinance in Yemen: Challenges and Opportunities

Islamic Microfinance in Yemen: Challenges and Opportunities

In an effort to foster hope and stability among Yemen’s por, Al-Amal Microfinance Bank is working to introduce a range of Sharia-compliant microfinance products aimed at reaching the unbanked. However, demand for Islamic financial products can far exceed the capacity of existing microfinance institutions to provide them. That’s why institutions like Al-Amal are often forced to limit their suite of Sharia-compliant products to one or more products that are relatively simple to administer and offer a clear return. In Al-Amal’s case, the signature Islamic product is murabaha. The mark-up ranges between 14.5% (for purchases more than $5,000) and 24% (for purchases below $5,000). Further development of Al-Amal’s murabaha offering and the introduction of other Sharia-compliant products, will hinge on the bank’s ability to reach Yemen’s rural poor, who represent some 80 percent of the country’s population

Banking a 100 Million Pakistanis

Banking a 100 Million Pakistanis

A team from Bankable Frontier Associates started a project to study the effect of interoperability in retail payments on the outcome of financial inclusion in Pakistan. The target they set was 100 million Pakistanis to be financially included electroni…