Integration of waqf and islamic microfinance for poverty reduction: case of Pakistan

Pakistan has been facing a high incidence of poverty. Despite its persistent efforts to make a dent on poverty, the country never witnessed a systematic reduction in the same. The country has been spending a significant amount on safety nets and social protection programs. Some programs provide d...

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Main Authors:	Shirazi, Nasim Shah, Obaidullah, Mohammed, Haneef, Mohamed Aslam
Format:	Article
Language:	English
Published:	Islamic Economics and Finance Research Division 2015
Subjects:	HB Economic Theory
Online Access:	http://irep.iium.edu.my/47794/ http://irep.iium.edu.my/47794/ http://irep.iium.edu.my/47794/1/IRTI_working_paper.pdf

id	iium-47794
recordtype	eprints
spelling	iium-477942016-01-19T08:58:27Z http://irep.iium.edu.my/47794/ Integration of waqf and islamic microfinance for poverty reduction: case of Pakistan Shirazi, Nasim Shah Obaidullah, Mohammed Haneef, Mohamed Aslam HB Economic Theory Pakistan has been facing a high incidence of poverty. Despite its persistent efforts to make a dent on poverty, the country never witnessed a systematic reduction in the same. The country has been spending a significant amount on safety nets and social protection programs. Some programs provide direct cash grants and other forms of indirect support to the poor, while microfinance programs provide microcredit, micro savings and micro insurance to the beneficiaries. The government extends full support to the microfinance industry and seeks to provide an enabling environment for its successful operation. As a result, the microfinance industry in Pakistan has been flourishing and steadily enhancing its outreach. However, despite all the efforts, it currently covers just about 10 percent of the market in 2013. In Pakistan, initiatives for Islamic microfinance have been undertaken by a few NGOs and financial institutions. Almost all IMIs function below operational self- sufficiency (OSS) and financial-selfsufficiency (FSS) levels. Most of IMIs are unable to increase their outreach due to the human and financial constraints. They face a constrained supply of funds as well as human resources. This paper posits that the constraints are more apparent than real. Islamic finance must include as part of the formal financial system, its time-tested institution of waqf involving endowment of both financial and real assets for community empowerment. The IMIs should be well aware of how to create and put to use such community assets for the economic and social betterment of the community. The paper sought the opinion of beneficiaries on waqf- Islamic microfinance integrated model and discussed the same with the professionals and practitioners. The beneficiaries were not aware of the main components of the waqf-microfinance integrated model, but professionals and practitioners, invariably supported the integrated model while voicing some concerns that should be considered while formulating policies for the sector Islamic Economics and Finance Research Division 2015-04-07 Article PeerReviewed application/pdf en http://irep.iium.edu.my/47794/1/IRTI_working_paper.pdf Shirazi, Nasim Shah and Obaidullah, Mohammed and Haneef, Mohamed Aslam (2015) Integration of waqf and islamic microfinance for poverty reduction: case of Pakistan. IRTI Working Paper Series . http://www.irti.org/English/Research/Documents/WP-1436-05.pdf
repository_type	Digital Repository
institution_category	Local University
institution	International Islamic University Malaysia
building	IIUM Repository
collection	Online Access
language	English
topic	HB Economic Theory
spellingShingle	HB Economic Theory Shirazi, Nasim Shah Obaidullah, Mohammed Haneef, Mohamed Aslam Integration of waqf and islamic microfinance for poverty reduction: case of Pakistan
description	Pakistan has been facing a high incidence of poverty. Despite its persistent efforts to make a dent on poverty, the country never witnessed a systematic reduction in the same. The country has been spending a significant amount on safety nets and social protection programs. Some programs provide direct cash grants and other forms of indirect support to the poor, while microfinance programs provide microcredit, micro savings and micro insurance to the beneficiaries. The government extends full support to the microfinance industry and seeks to provide an enabling environment for its successful operation. As a result, the microfinance industry in Pakistan has been flourishing and steadily enhancing its outreach. However, despite all the efforts, it currently covers just about 10 percent of the market in 2013. In Pakistan, initiatives for Islamic microfinance have been undertaken by a few NGOs and financial institutions. Almost all IMIs function below operational self- sufficiency (OSS) and financial-selfsufficiency (FSS) levels. Most of IMIs are unable to increase their outreach due to the human and financial constraints. They face a constrained supply of funds as well as human resources. This paper posits that the constraints are more apparent than real. Islamic finance must include as part of the formal financial system, its time-tested institution of waqf involving endowment of both financial and real assets for community empowerment. The IMIs should be well aware of how to create and put to use such community assets for the economic and social betterment of the community. The paper sought the opinion of beneficiaries on waqf- Islamic microfinance integrated model and discussed the same with the professionals and practitioners. The beneficiaries were not aware of the main components of the waqf-microfinance integrated model, but professionals and practitioners, invariably supported the integrated model while voicing some concerns that should be considered while formulating policies for the sector
format	Article
author	Shirazi, Nasim Shah Obaidullah, Mohammed Haneef, Mohamed Aslam
author_facet	Shirazi, Nasim Shah Obaidullah, Mohammed Haneef, Mohamed Aslam
author_sort	Shirazi, Nasim Shah
title	Integration of waqf and islamic microfinance for poverty reduction: case of Pakistan
title_short	Integration of waqf and islamic microfinance for poverty reduction: case of Pakistan
title_full	Integration of waqf and islamic microfinance for poverty reduction: case of Pakistan
title_fullStr	Integration of waqf and islamic microfinance for poverty reduction: case of Pakistan
title_full_unstemmed	Integration of waqf and islamic microfinance for poverty reduction: case of Pakistan
title_sort	integration of waqf and islamic microfinance for poverty reduction: case of pakistan
publisher	Islamic Economics and Finance Research Division
publishDate	2015
url	http://irep.iium.edu.my/47794/ http://irep.iium.edu.my/47794/ http://irep.iium.edu.my/47794/1/IRTI_working_paper.pdf
first_indexed	2023-09-18T21:07:57Z
last_indexed	2023-09-18T21:07:57Z
_version_	1777411060158955520

Integration of waqf and islamic microfinance for poverty reduction: case of Pakistan

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