Mhammed, Aliyu Dahinu and Hasan, Zubair (2008): Microfinance in Nigeria and the prospects of introducing its Islamic version there in the light of selected Muslim countries' experience.
Download (264Kb) | Preview
Today widespread poverty is one of the major problems of mankind and its alleviation one of her major agendas. In recent years microfinance has emerged as an important instrument to relieve poverty in the developing countries. Today there are more than 7000 micro lending institutions providing loans to more than 25 million poor individuals across the world, their vast majority being the women. However these institutions face some serious challenges, especially in less developed countries where the proportion of people in poverty is high. The existing microfinance in Nigeria serves less than 1 million people out of 40 million being the potential number that need the service. Also, the aggregate micro credit facilities in Nigeria, account for about 0.2 percent of the GDP and is less than one percent of total credit in the economy. Addressing this situation inadequately would further accentuate the problem and slow down growth and development of the country. We find that the microfinance institutions charge interest rate as high as up to 100% for lending and pay as low as 5% on savings. This aggravates the existing inequalities in the distribution of wealth and income in Nigeria. Finally, Nigeria being a country with a Muslims majority, represents a potential for Islamic microfinance especially that most Muslims reject the conventional interest based micro financing, which is not tailored in line with their faith. This might cause failure of government project to combat poverty in the country through micro financing. Under the circumstance Islamic micro financing has potential to serve the country better. The paper has relied on the sources of Shari`ah law, secondary data from journals, periodicals, conference proceedings, text book , internet search and other sources of published data to support the argument.
|Item Type:||MPRA Paper|
|Original Title:||Microfinance in Nigeria and the prospects of introducing its Islamic version there in the light of selected Muslim countries' experience|
|Keywords:||Key words: Microfinance; Islam; Nigeria|
|Subjects:||E - Macroeconomics and Monetary Economics > E5 - Monetary Policy, Central Banking, and the Supply of Money and Credit > E51 - Money Supply; Credit; Money Multipliers|
|Depositing User:||Zubair Hasan|
|Date Deposited:||17. Apr 2008 01:03|
|Last Modified:||10. Jan 2014 05:06|
Abdallah, A. (1999) Partnership (Musharkah): A new option for Financing small enterprises” published by Arab Quarterly Journal,p.259,2006
Abideen, Adewale, A. (2006) “Poverty Alleviation through Provision of Islamic Microcredits: A Case Study of Selected Muslim Owned Micro Enterprises in Ilorin, Nigeria.
Aliriani Kais“Microfinance in the Arab world, shaping the industry`s future”SMED, a paper presented at first annual conference of Sanabel, Microfinance of Arab Countries last accessed at www.microfinancegateway.com , 20/01/2008
Anyanwu, C. M. (2004) Microfinance Institutions in Nigeria: Policy, Practice and Potentials, Paper Presented at the G24 Workshop on “Constraints to Growth in Sub Saharan Africa,” Pretoria, South Africa, by the Deputy Director Central Bank of Nigeria, November 29-30, 2004
Badr-El-Din A. Ibrahim Works on Islamic banking and Islamic financeAvailable at www.uncdf.org, last accessed on 21-01-2008
Baharum, Muhammed (2005) “ Ar-Rahnu A New Microfinance Era in Malaysia” National Cooperative Organization of Malaysia (Ankasa)
Bamisile, A. Sesan (2006) “Developing a Long -Term Sustainable Microfinance Sector In Nigeria”: The Way Forward, Washington Dc, USA, October 23 – 27, 2006. Brigit Helms, Access to All: Building Inclusive Financial Systems, Consultative Group to Assist the Poor, World Bank, 2006, P2
Chiara Segrado (2005) “Islamic microfinance and socially responsible investments” Meda Project, Published by University of Torino
Dieter, Seibel, Hans (2005) Islamic Microfinance in Indonesia, published by Deutsche Gesellschaft für, Indonesia
El-Karansahawy, Hatem (2007),Finance Plus : A Model for the Activation of Micro and Medium Finance, a paper Presented at the first International conference on Inclusive Islamic Finance, Brunei 2007.
Enugu Forum, Policy Paper 7 “Policy Challenges for Microfinance Design and Practice in Nigeria” Debating Policy Options for National Development last accessed 20/12/2007 at www.microfinancegateway.com
Frishman, Alan, (1986) “The impact of Islam on the urban structure and economy of Kano, Nigeria”, published by The journal of Muslim minority affairs,Vol.7 Noo.2, 1986
Folake, Abimbola, F. (2005) microfinance as a Policy Tool for Poverty Alleviation: A Study of the Performance of Ten microfinance Institutions in Nigeria, Morgan State University
Gama, Umar G. (2004) Annotated Bibliography on Shariah in the North of Nigeria: From Non-Reference Materials Available To the Public at Higher Institutions in Kano and Kaduna States 1982-2004
Gusau Ahmed S. (2004) Islamic Banking: The Nigerian Experience, A Paper Presented At International Seminar on Islamic Banking and Finance, Held on 27th – 28th February 2004 at Accra, Ghana.
Habib, Ahmed (2002) Financing Microenterprises: An Analytical Study of Islamic Microfinance Institutions, Islamic Economic Studies Vol.9, No. 2, March 2002
Habib, Ahmed (2004) Frontiers of Islamic Banking: A Synthesis of Social Role and Micro finance, The European Journal of Management and Public Policy
Habib, Ahmed (2007) Waqf-Based Microfinance: Realizing The Social Role of Islamic, Paper written for the International Seminar on “Integrating Awqaf in the Islamic Financial Sector” Singapore, March 6-7, 2007
Hasan, Zubair (1988) “Distributional Equity in Islam” in Distributive justice and need fulfillment in an Islamic economy, edited by Munawar Iqbal, (1988) Islamabad : International Institute if Islamic Economics Hulme D. ,Arun T.(2003) “Balancing Demand and Supply side of Microfinance”: the emerging Agenda for Microfinance Institutions, Journal of Microfinance,2003 ,Volume 5, number 2
Hulme, David, (2000), Impact assessment methodologies for microfinance: Theory, experience and better practice, World Development Vol.28, No.1
IRTI and CIBFM (2007) Enhancing Islamic Financial Services for Micro and Medium sized Enterprises (MMES), proceedings of First Islamic conference on Inclusive Islamic Financial Sector Development, Brunei, 17th -19th April, 2007, volume 1&2 Hasan, Zubair (1986) Distributional Equity in Islam, in Munawar Iqbal (ed,) Distributive Justice and Need fulfillment in Islam, Islamic Foundation (UK)
Iqbal Z.and Mirakhor A. (2007) An Introduction to Islamic Finance, Published by John Wiley and Sons, Singapore John D. Conroy (2003) The Challenges of Micro financing In Southeast Asia, Singapore: Institute Of Southeast Asian Studies
Khan, M. Amanullah and Shirazi S. Nasim (2007) Role Of Micro Credit In Poverty Alleviation: A Study With Reference To Pakistan, First National Conference on Islamic Finance, University Darul Iman, Terengganu, Malaysia.
Mannan, M. A (2007) “Alternative Micro-Credit Models in Bangladesh: a comparative Analysis Between Grameen bank and Social Investment bank LTD. Myths and Realites.”presented at first International Conference on Inclusive Islamic Finance, Brunei, 2007 Microfinance Policy, Regulatory And Supervisory Framework For Nigeria Central Bank Of Nigeria, Abuja, December 2005
Obiyo C. Ofurum And Chinyere I. (2007) Islamic Financing/Banking In The Nigerian Economy: Is It Workable? A Review Of Related Issues And Prospects, First National Conference on Islamic Finance,University Darul Iman, Terengganu, Malaysia.
Otero, Maria (1999) Binging Back Development in Microfinance, Journal of Microfinance, Volume 1, number 1, 1999
Radwan, Ismail (2008) “The Potentials of Public-Private Partnerships in Microfinance Delivery”, a paper presented at International Microfinance Conference Abuja, Nigeria on January 2008
Rahman, A., “Micro Credit Initiatives for Equitable and Sustainable Development: Who Pays?” World Development, Volume 27, No.1, 1999.
Sadeq M. AbulHasan (2007) “ Microfinance, Poverty Alleviation and Economic Development” : Theory and Practice, a paper presented at First International Conference on Inclusive Islamic Financial Sector Development, Brunei , 17-19 April, 2007
Soludo, Chukwuma C.(2008) “Framework For Public Private Partnership In Micro financing In Nigeria” A Keynote Address By The Governor Of The Central Bank Of Nigeria At The International Microfinance Conference And Annual Microfinance/Entrepreneurship Awards, Abuja, Nigeria,January 17 -18, 2008 Soludo, Chukwuma A. (2007) “Nigerian Economy: Can We Achieve The Vision 20: 2020? Governor, Central Bank Of Nigeria 8th January, 2007
UNDP`s document on “Development of a sustainable pro-poor financial sector Phase II MicroStart Nigeria” www.uncdf.org. accessed on 12/01/2008
UNCD (1999) The Constraints and Challenges Associated with Developing Sustainable Microfinance System in Disadvantaged Rural Areas in Africa
UNCDF, “Basic Facts About Microfinance”, United Nations Capital Development Fund, New York, NY, USA, http://www.uncdf.org/english/microfinance/facts.php UNCDF, 1997. “Micfinance: Nigeria country report, “ United Nation Capital Development Fund,http://www.uncdf.org/english/microfinance/reports/country_feasibility/
Yunus, M., “Expanding Microcredit Outreach to Reach: The Millennium Development Goal - Some Issues for Attention”, Palli Karma-Sahayak Foundation, Dhaka, Bangladesh, 2003. http://eprints.qut.edu.au/archive/00000221/01/gow.pdf14.12.2007
http://allafrica.com/stories/accessed on 27/1/2008 www.islamonline.net/english/news/2005 accessed on 29/01/2008
Available Versions of this Item
- Microfinance in Nigeria and the prospects of introducing its Islamic version there in the light of selected Muslim countries' experience. (deposited 17. Apr 2008 01:03) [Currently Displayed]