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Silatech, a Qatar-based social enterprise aiming to increase employment and entrepreneurship among youth in the Middle East and North Africa, recently announced the development of Narwi, a nonprofit crowdfunding platform that will support microentrepreneurs via Islamic charitable giving. The platform is scheduled to be launched in late June 2015. Through Narwi, donors will be able to establish an endowment called a “Narwi Waqf” to fund microentrepreneurs with donations as small as USD 25. Projects featured by Narwi are sourced solely from lenders in Egypt, Iraq, Jordan, Lebanon, Palestine, Somalia and Yemen that are compliant with Shariah.

Founded in San Francisco and recently moved to Jakarta, a financial startup called Blossom aims at nothing less than shaking up the microfinance sector in Indonesia. The company, launched in October 2014 by US entrepreneur and practicing Muslim Matthew Joseph Martin, plans to bring Shariah-compliant microfinance to the country. What sets Blossom apart from other financing schemes are two special features. First of all, its entire platform is Shariah-compliant. The second feature is the fact that its platform uses the cryptocurrency Bitcoin for global money transfers, at least in the background, to keep transfer costs low and money flows transparent. Last month, Blossom announced that it will make a "pilot investment of up to 100,000" in Bitcoins into BMT Nusantara Condet to fund small to medium businesses in Jakarta.

What’s so fascinating about the microfinance craze is that it persists in the face of one unfortunate fact: microfinance doesn’t work. As David Roodman from the Center for Global Development put it in his recent book, the best estimate of the average impact of microcredit on the poverty of clients is zero. A comprehensive DFID-funded review of extant data comes to the same conclusion: no clear evidence yet exists that microfinance programmes have positive impacts. In fact, it turns out that microfinance usually ends up making poverty worse. The reasons for this are fairly simple. Most microfinance loans are used to fund consumption – to help people buy the basic necessities they need to survive.

Microfinance is a well-developed strategy to alleviate poverty around the world, Islamic Development Bank (IDB) President Ahmad Mohamed Ali said Monday. Speaking at the forum of "Exploring Innovative Solutions for Affordable Islamic Microfinance on the sidelines of the 40th Annual meeting IDB, Ali emphasized that microfinance is a rapidly growing market. Ali said that a number of challenges confront efforts for microfinance by Islamic banks today. These include the need for coordinating policy and direction, weakness in regulatory and supervisory environments, lack of awareness and education about Islamic finance, and a severe shortage of qualified and trained human capital.

Microfinance is a well-developed strategy to alleviate poverty around the world, Islamic Development Bank (IDB) President Ahmad Mohamed Ali said Monday. Speaking at the forum of "Exploring Innovative Solutions for Affordable Islamic Microfinance on the sidelines of the 40th Annual meeting IDB, Ali emphasized that microfinance is a rapidly growing market. Ali said that a number of challenges confront efforts for microfinance by Islamic banks today. These include the need for coordinating policy and direction, weakness in regulatory and supervisory environments, lack of awareness and education about Islamic finance, and a severe shortage of qualified and trained human capital.

Blossom is a fintech company that offers Sharia complaint financial services to people in countries that are predominantly Islamic. The company merges bitcoin and traditional microfinance into a single package. Blossom offers microloans for the needy in Indonesia. What sets Blossom apart from most other players is the platform. Blossom platform uses bitcoin as a background to enable investors from across the world to fund those who are looking for micro-loans. Blossom ensures that the whole process is in accordance with Sharia’s Musharakah principle and the company doesn’t support businesses involving usury, gambling, pornography and other activities which are deemed unislamic.

To contribute effectively to the financing of microfinance projects at the grassroots level, the CBOS has signed microfinance contracts with 15 microfinance institutions from the first installment with 50% of the loan of the Arab Fund for Economic and Social Development (AFESD) of a total $ 50 million used mostly for funding microfinance projects. This loan will be used in the rural projects that contribute to combat poverty among the economically active poor classes.The first phase will fund small and micro projects through 4 microfinance institutions providing funds for customers in the localities of Khartoum State and 11 other state institutions that provide finance for microfinance customers in most of the other States of the Sudan.

The confluence of two strongly expanding industries, microfinance and Islamic finance, has seen rapid growth in the past years on the grounds that, according to banking studies, an estimated 70% of people living in Muslim-majority countries do not use formal financial services. As a result, Islamic microfinance is becoming an important instrument to fight the poverty among Muslims, especially in rural areas, and improve access to financial services. Islamic microfinance is expected to grow fast at a rate of 19.7% annually over the period 2014 to 2018. But so far, Islamic microfinance is centred on just a few countries. However, in the recent past demand has also grown in countries such as Jordan, Algeria, Syria, Sudan, Somalia, Yemen among others.

A startup that recently relocated from San Francisco to Jakarta aims to shake up micro-finance in Indonesia. Blossom‘s concept can be said to be breaking ground: it operates on Bitcoin and targets the global Muslim community. Blossom collects money from investors around the globe. Blossom does not hand down the funds to business owners directly, but via an experienced microfinance institution on the ground. After a 12-month investment cycle, Blossom collects profits from the microfinance institutions and distributes them back to the investors. Blossom expects returns in the range of 7.5 to 12.5 percent, and itself takes a 20 percent cut on the returns. All of its money transfers are based on Bitcoin.

Islamic Microfinance (IMF) is a novel method for human-oriented economic development and a capacity-building tool, which easily fits into the Islamic banking and finance (IBF) paradigm through social responsibility. A financial system should be able to provide financing to different segments of a given society such that, in addition to financial and economic objectives, social objectives may be served. It is imperative for IBF to fulfill such objectives alongside their business interests. Due to the complementarity between IBF and microfinance, there is a need to see further and proactive involvement of IBF and nonbanking Islamic institutions to provide IMF.

Although microfinance client numbers have roughly quadrupled in the last half-decade, they still represent the proverbial drop in the bucket of potential clients. Some 650 million Muslims hover at or below the poverty line today. There are five takeaways from CGAP's most recent research on the subject, "Understanding the Costs and Sustainability of Sharia-Compliant Microfinance Products". First, some "Islamic" products are tough to scale. Second, comparing Islamic products to conventional microfinance doesn’t always work. Third, sustainability is possible, but it will take significant investment. Fourth, we need more time to understand how these products are working - and who is using them. Fifth, in the meantime, Islamic financial service providers are here to stay.

Islamic Corporation for the Development of the Private Sector (ICD) has signed a new agreement with Azerbaijani microfinance institution VisionFund AzerCredit (VF AzerCredit). The objective is to provide advisory services with the aim of developing a comprehensive Shariah-compliant microfinance solution for the country. Vision Fund AzerCredit's work emphasizes the provision of loans to small and micro entrepreneurs in rural areas, especially those remote regions which remain largely unbanked, through 45 outlets in 38 districts. With more than 80,000 borrowers and a portfolio of over US$83 million, the group is a leader in the Azerbaijani microfinance field. The VF AzerCredit agreement represents the latest step in the ICD's program to support and develop the growth of the private sector in Azerbaijan.

The Islamic Corporation for the Development of the Private Sector (ICD) has signed a new agreement with Azerbaijani microfinance institution Vision Fund AzerCredit. The objective is to provide advisory services with the aim of developing a comprehensive Shari’ah-compliant microfinance solution for the country. VF AzerCredit's work emphasizes the provision of loans to small and micro entrepreneurs in rural areas, especially those remote regions which remain largely unbanked, through 45 outlets in 38 districts. With more than 80,000 borrowers and a portfolio of over $83 million, the group is a leader in the Azerbaijani microfinance field.

CIMB Islamic Bank Bhd. plans to start offering microloans in Malaysia as it seeks new growth avenues after delaying plans to create a Shariah-compliant megabank. The Malaysian lender will offer a wide range of products including microsavings, microinsurance and advisory services. While acknowledging the risks, CIMB will put in place a framework to manage defaults. The lender’s microfinance business will develop in stages starting at the higher end. Keeping in mind that prospects for growth are good, the bank is looking to launch something subject to relevant approvals by this year.

Tamkeen and Family Bank signed an agreement to add BD2 million to the microfinance support scheme, bringing the programme’s total portfolio value to BD 5 Million. The agreement is part of Tamkeen’s and the Family Bank’s efforts to provide customised Sharia-compliant financing solutions to help micro enterprises, including productive families, to grow, in addition to enabling low-income Bahrainis to establish small businesses. Under the programme, Tamkeen supports 50% of the loan profit. Finance amounts range between BD500 and BD5,000. Tamkeen also provides advisory services to customers.

Abu Dhabi-based Khalifa Fund for Enterprise Development will provide $200 million in loans for microfinance projects in Egypt, a move it said would create more than 120,000 jobs by 2020. The UAE state investment fund has signed the loan agreement with the Egyptian government in Cairo. The loan will be directed towards microfinance development in remote and disadvantaged areas and pockets of poverty throughout Egypt. It will also help Egyptian women in rural areas find work. Egypt issued its first law regulating microfinance services last week, seeing the provision of extremely small loans could help to create jobs by giving individual entrepreneurs a start.

A series of German-funded studies and pilot projects aims to bridge the gap between Islamic finance and microcredit, to the benefit of communities in developing countries. Expanding the appeal of Islamic microfinance is crucial for an estimated 650 million Muslims who live on less than $2 a day, according to the Washington-based Consultative Group to Assist the Poor (CGAP). The German government's international development agency GIZ is helping to develop regulations, education and training for Islamic microfinance in developing countries. A study of Islamic microfinance products by GIZ and CGAP aims to identify ways to lower costs, while a separate GIZ study is exploring demand factors.

The Global Islamic Microfinance Forum (GIMF) will be organized jointly by AlHuda Centre of Islamic Banking and Economics (CIBE) and AKHUWAT on November 01-02, 2014. The purpose of this 4th GIMF is to unite Islamic Microfinance Industry under one roof. Islamic microfinance is going through big challenges e.g. non availability of Shariah Compliant funds, misconceptions regarding Islamic microfinance, lack of man power, regularity and Shariah problem. The purpose of this forum is to gather the stakeholders under one platform to find out the remedy to these problems to give a strong support to rapidly increasing Islamic Microfinance industry.

The crowdfunding platform Kiva and Grameen-Jameel Microfinance Ltd. have partnered to launch ‘Change is in Your Hands’. The campaign enables individuals who want to help entrepreneurs with a plan. As part of the launch, Grameen-Jameel is offering up to 13,000 visitors to www.kiva.org/MiddleEast a ‘free trial’, the equivalent of $25 to lend to the entrepreneur of their choice. To double the campaign’s impact, Grameen-Jameel is also matching up to $665,000 in loans made by Kiva lenders. In total, Grameen-Jameel has committed $1 million to this campaign. Loans that meet both traditional and Islamic financing standards are available. ‘Change is in Your Hands’ will focus as a first step on lending to support entrepreneurship among women and youth in Jordan, Lebanon, Iraq, Palestine, Yemen, and Turkey.

The Ghana Islamic Microfinance, the first Shariah-compliant financial institution in Ghana, is to receive the Women’s For Development Award 2014 from the Islamic Development Bank. The award will be presented to the financial institution at an event of the Board of Directors of the Islamic Development Bank, taking place in Jeddah, Saudi Arabia from June 22 – June 26. Ms Suwaiba Mohammed Amin, the Programmes Manager of Ghana Islamic Micro-finance said the aim of the financial institution is not to bring Shariah law to Ghana but to use its principles to promote ethical financing and fight against the exploitative loans currently going on in the country.