Entrepreneurship is a job creation engine that has a positive impact on local, regional and national economies. The tide of new entrepreneurial ideas, training, education, research, consultancy and experimentation will help in boosting up the health of the economy as a whole.

By providing access to financial services microfinance plays an important role in the fight against the many aspects of poverty and improving the lives of the poor people. Experiences shows that microfinance can help the poor to increase income build viable businesses and reduce their vulnerability to external shocks. It can also be a powerful instrument for self-empowerment by enabling the poor, especially women, to become economic agents of the change.
Muslim Aid has been implementing development projects such education, healthcare, water & sanitation, Skills training and many others. However, Muslim Aid needs to consolidate the activities by providing financial services so that people can now start to look into ways in which they can become self-reliant and earn a living. Micro-finance as part of our strategies to tackle world poverty, diminish vulnerability of poor population, and reduce economic and social exclusion makes Muslim Aid a dynamic organization. Through Microfinance Muslim Aid can reach more people than scarce donor resource and augment local resources. We also realized that financial services can help the poor through increasing their household income, build assets & stabilize their consumption. Muslim Aid believes that it can achieve the Millennium Development Goals (MDGs) by combining Microfinance with other development interventions such as education, water and health.

Aims of Muslim Aid Microfinance Programme :

• Improve the lives of the extreme poor by providing a variety of financial and non-financial services
• Present a more community-friendly alternative of poverty alleviation through a group- based approach.
• Empower the poor and destitute people by building their capacity through skill training and giving guidance and business advice.
• Create economic opportunities for the poor by developing small and medium enterprises and provide employment opportunities.
• Promote awareness of other development issues like education, health and sanitation, human rights and justice

MA-MEDP
To tackle the root causes of poverty Muslim Aid decided to help the potentials entrepreneurs to utilize their potentials and start entrepreneur activities. Muslim Aid is providing both technical and financial support. We opt for Shariah compliant financial services and adopt Qarde Hasana and Murabaha modes of financing..

• Murabaha (cost-plus sale) product

This product involves the resale of a commodity, after adding a specific profit margin by the lender to the borrower who agrees to buy that commodity for the new offered price. That is Muslim Aid buys and resale a commodity with deferred price to a client who has identified the commodity as a means to generate income generation. Muslim Aid purchases a commodity on behalf of a client and its resale to the latter on cost-plus-profit basis. Under this arrangement Muslim Aid discloses its cost and profit margin to the client.

Ceiling range Rs 5,000 to Rs 30,000

• Qarde Hasana

In some areas we offer Qarde Hasana especially to destitute for enterprise establishment or enhancement and in some cases for getting out of the interest net of moneylender. We are getting 5% as membership fee from the client.

Credit range Rs 5000-Rs 15000

Success Story-1

Mr.Abdul latif, a poor drycleaner living in a tiny house of sadiqabad, Rawalpindi. He has seven children; studying in difference classes. He was working in a dry clean shop but the owner of the shop fired him from job. It was a difficult time for him as his only source of income was closed. Then one day he came to know about Muslim Aid Micro finance Project.

Muslim Aid provided him an interest free loan of Rs.8000 for purchase of an iron, a washing machine and a wood table and starts his own small business of laundry and ironing in a rental shop. Now he is earning Rs 250-300 daily. With this income he is not only supporting his family but also repaying the loan in monthly instalments.

From Repairing to making: A Case Study of Shoe Maker

After retirement he open a small shop and start work as cobbler. He was only repairing shoes. He wanted to start making of shoes too, but was unable due to financial constraints. He was not willing to get loan on interest.

“I got a loan from an organization for starting business and return that within time. But they charged interest. Then I decided that I will not take any other loan on interest. One day i got a leaflet outside a mosque in which Muslim Aid was giving interest free loans. I visited their office, got information and made my mind to apply for it. I purchased equipments for shoe making like Sewing machine, scissor, leather etc for Rs 10,000/-. Now along with repairing I am also making shoes, chappal etc” said Hussain.

“There was very nominal profit in shoe repairing and we were hardy meet our expenses. Unfortunately I was not able to provide education to my three children. My elder boy, Husnain is working with me. But hope we will be able to provide education to the youngest children. Now with shoe making my income increased between Rs 3000 to 4000. I am making shoes and my son is repairing the older shoes. Thanks Allah, that we got some relief. We appreciate Muslim Aid for initiating Interest free loan program ” Elaborated Hussain.