ISLAMIC (MICRO)FINANCE

The limits of charity
• Receipt of sadaqat or zakat—often given following holidays—was rare, serendipitous, and
minimal, contingent on a comparably wealthier person in the community (e.g. a child’s
teacher, a relative) providing gifts of clothing, food, or money. However, the holidays were
equally likely to be a financial burden. The month of Ramadan and concluding holiday of
Eid-ul-Fitr are particularly costly. Transport costs to visit relatives, new clothes and shoes
for children, and the purchase of special foods for guests are common expectations. For
several families, this was a time of food insecurity, with meals consisting of white rice
seasoned with dried chilies. Meanwhile, restaurant or tea stalls workers might be out of
work if their workplace closes for Ramadan, and other businesses run reduced hours.
IMFI strategies for female-headed households
• Employment opportunities for women can be slim, especially for women observing purdah
or modesty who might not leave their home or immediate community without a male
relative. Skills training and facilitation of market linkages are complementary IMFI
strategies that can enable home-based income generation (e.g. tailoring/stitching, product
assembly, craft work).
• Giving clients the option of mobile money repayment (currently a rare practice) would
accommodate women for whom to travel to offices is a hardship.
• Developing products and services specifically for abandoned and widowed women. This
could include qard hassan, which carries only a minimal fee, or pairing microfinance with
school scholarships for orphaned 98 children to provide an inter-generational approach to
poverty alleviation.
• Public critique or even commentary on the lack of women working in global IBFIs and
IMFIs is practically nonexistent. However, the presence of female employees in IMFIs—
particularly those in client-facing rather than support roles—can enable outreach to female
clients potentially hesitant to interact with unknown men by themselves. The Islamic Relief
microfinance program I studied in Pakistan saw an uptick in timely repayments and
positive client experiences by adding female field officers.
5 REGULATORY, POLITICAL, AND ECONOMIC
CHALLENGES
5.1 Bangladesh
In Bangladesh, a nation of nearly 160 million with the world’s fourth-largest Muslim population,
about 70% of inhabitants live in rural or semi-rural areas. 99 The economy suffers from a less-thanideal
annual growth rate, and foreign direct investment continues to be hampered by political
98 In Bangladesh and Pakistan, children whose mothers are widowed or abandoned are often referred to as orphans.
99 CIA World Factbook 2014
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