Conference and Workshop Report on "Islamic Modes of Financing"

Paper
Date Published: 
Nov 2000
Author: 
Association for Creation of Employment

Proceedings from Conference and Workshop on "Islamic Modes of Financing", 2000

This document presents the details of a conference-cum-workshop that the 'Association for the Creation of Employment' held in Peshawar, Pakistan.

The workshop aimed to:

  • Create awareness and develop a practical lending model in Pakistan that could be immediately implemented at the micro-level, and then modified, if necessary, according to Islamic principles;
  • Diffuse tensions between the clergy and development workers.

The details of the workshop are as follows:

  • Speakers explained economic concepts and shared their experiences;
  • Participants applied these principles and concepts to real-life situations;
  • The workshop developed models lending for livestock, agricultural inputs and trading, shop-keeping and machinery loans.

The results of the conference were as follows:

  • Positive feedback from the clergy and Academia;
  • Appreciation from the clergy of the work of the non-government-organization (NGO) sector.

The participants of the workshop recommended:

  • Experimentation of these models and repetition of these exercises;
  • Distribution of information among the public, enabling them to know what to demand and how to enter into contracts that Islam allows.

The conference made the following points:

  • The objective of Islamic banking was the maximization of social benefits through the creation of healthier financial institutions;
  • Islam allows two parties to negotiate profit/loss so that the higher productivity of one partner or the additional services that one partner provides could be adequately compensated;
  • The Grameen Bank model would be suitable for Islamic microcredit because it is group-based and allows internal monitoring.
Type: 
Paper