Islamic Microfinance: Link Between Islamic Micro Finance & Takaful
The world of microfinance revolves around banks and insurance companies, essential pillars supporting economic systems. Islamic microfinance, adhering to Sharia principles, provides financial assistance and protection against various risks. Products like Murabaha and Takaful play vital roles in this system. Understanding the significance of Takaful in Islamic microfinance is crucial for its successful implementation and operation. Presented insights highlight the interconnectedness of Islamic microfinance and Takaful in ensuring financial stability for underprivileged individuals and microenterprises.
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Presentation Transcript
LINK BETWEEN LINK BETWEEN ISLAMIC MICRO ISLAMIC MICRO- -FINANCE & & MICRO MICRO- -TAKAFUL TAKAFUL FINANCE
INTRODUCTION The world of microfinance is structured around two main axes: Banks, that manage the financing of the entire economy through the support of investment and consumption, and; - Insurance companies, that constitute in a way the back office of the financial sphere including banks which, without the support and assistance of the insurance and reinsurance companies, cannot resist the structural deficits that undermine them. - The economic system nowadays is based on finance which itself cannot work without insurance. It is the lungs that allow the economic and financial body to breathe and flourish.
ISLAMIC MICRO FINANCE ISLAMIC MICRO FINANCE ISLAMIC MICRO TAKAFUL ISLAMIC MICRO TAKAFUL DEFINITION DEFINITION DEFINITION DEFINITION A mechanism provide financial assistance to people excluded from the banking system. Islamic microfinance complies with principles of Islam and involves in projects halal (allowed by sharia). A mechanism to provide disadvantaged individuals or micro entreprises a sharia based protection at an affordable cost. PRODUCTS PRODUCTS PRODUCTS PRODUCTS - Risks coverage - Sickness, death ,disability - Natural disaster, climatic changes - Fire or theft of assets - Loss of job - Life insurance - Health insurance - Agricultural insurance - Assets and propertyinsurance - Murabaha - is the Sharia-compliance contract the most commonly used to finance goods. - Qard al hassan is a loan extended on a goodwill basis, and the debtor is only required to repay the amount borrowed - Musharaka and mudaraba are contracts which share risks and benefits. - Salam is an advance payment in exchange of a future delivery. With the Islamic Insurance TAKAFUL more specifically the micro Takaful, the risks that the microfinance institute and its members will incur will be shared. So with all these financing tools. It should be noted that the Microfinance Institution is exposed to risks that could have negative consequences for its operation; as well as the potential beneficiaries of these financing. So we can undoubtedly say that the micro Takaful is essential to the good functioning of the Islamic financial system. So its implementation is crucial before considering promoting Islamic microfinance banks or houses This necessarily requires a mechanism to manage all these risks.
CONCLUSION We can see that Islamic microfinance cannot go without the micro Takaful . The latter can serve as a leverfor further penetration into the market, in compliance with the rules that govern this sector.
Presented by Dame MBAYE Founder and CEO of OAC SA (Brokerage in Insurance) Dakar, SENEGAL Mobile: 0022177-378-29-39 E-mail: dame@oac-assurances.org
IF ISLAMIC MICROFINANCE IS THE HOPE FOR THE POORS MICROTAKAFUL IS THE HOPE FOR ISLAMIC MICROFINANCE AS WELL ASSALAM WALEIKUM WARAKH MARULAH ..
