Feed the Future
This project is part of the U.S. Government's global hunger and food security initiative.

Islamic Finance

Islam poses an interesting challenge to the microfinance sector as strict interpretations of the Sharía, or Islamic, law forbid the charging of interest. Though not all Muslims adhere to such strict interpretations, large populations do. Microfinance institutions are challenged to adapt traditional Islamic financial products, many of which involve risk-sharing mechanisms or derivatives of leasing arrangements, to meet the needs of poor clients. Although the offering of such Sharía-compliant Islamic financial services by traditional commercial banks has dramatically increased in recent years, devout but poor Muslims of certain sects remain shut out from access to formal financial services.