Micro finance : microloans

Fatawa Question

Assalamulaikum, Dear Dr. Monzer Kahf, MFI-microloans finance institution had proven us tremendous success especially in Bangladesh with Prof. Muhammad Yunus, the founder of the Grameen Bank. It had pulled out the people of Bangladesh from the grip of poverty to be a self-entrepreneur with its microloans. But the problem is, the microloans itself operated under 'Riba' where it charge a moderate amount of interest on the people who take the loan. Would it be fine to charge interest since it just a small amount of loan ? Because it purpose is to help the poor and maybe it can be describe as Hibah (I mean the interest). And prof. Muhammad Yunus said it is fine because it is the borrower-owned bank....

Fatwa

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Publication Date

2008-09-21

Main Subjects

Financial and Accounting Sciences
Islamic Studies

Topics

• Islamic jurisprudence
• Loans
• Resale on profit
• Usury

No. of Pages

1

Data Type

Fatawa

Language

English

Record ID

BIM-730768

• APA
• MLA
• AMA