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Role of it in islamic microfinance by waqas shahid
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Role of it in islamic microfinance by waqas shahid

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  • 1. International Conference onIslamic Microfinance
    Organized By :
    CENTER OF ISLAMIC BANKING & ECNOMICS
    Held At:
    Faisal Auditorium Islamabad - Pakistan
  • 2. Information Technology
    as a tool in strengthen Islamic Microfinance
  • 3. Outline
    • Objectives
    • 4. Technology in support to IMF (Islamic Microfinance)
    • 5. Problem Areas in Manual Processing
    • 6. Models Representation
    • 7. Web application overview
  • Objectives
    It has been felt strongly to explore the relevance of Islamic Financial Instruments for developing effective Microfinance Instruments and functional framework for Banks and NGOs. The need of the hour is to consolidate the valuable efforts of the scholars and practitioners to come up with a common understanding and agreed upon model of Islamic Microfinance.
  • 8. Technology in Support to IMF
    • Financing application from initiation to disbursement is fully computerized & paperless
    • 9. Relevant customer info updated in system are automatically populated into Credit System
    • 10. Web based configurable parameter driven Credit system with fully integrated end to end workflows
    • 11. Online Decisioning (Approve/Reject/Return)
    • 12. Auto-SMS/ Email blast on the decision of application
    • 13. Credit information retained in the system
  • Problem Areas in Manual Processing
    • New Customer Profile Creation
    • 14. Poor quality of financial data
    • 15. No aggregate record
  • Problem area
    • New Customer Profile Creation
    Improved workflow
    Manual workflow
    Post all forms to Head Office
    Customer Profile form
    filled on paper in field
    Branch Manager Approval
    Customer Profile form
    filled electronically in field
    Manager Approval
    SMS/Email all forms to Head
    Office
    Head Office enters
    info to database
    Customer is approved!
    Customer is approved!
    Piles of extra paper and money gone to waste
    Goals
    • Reduce costs
    • 16. Improve client data quality
    Results
    • Low labour cost
    • 17. Relative efficiency
    Methods
    • Simple web and mobile-phone application to record client data in field
    • 18. Data transmission via SMS/Email
    • 19. Automatic upload of data into database using a smart phone SMS-Server / Email-Server
  • Problem area
    • Poor quality of financial data
    • 20. No aggregate record
    Improved workflow
    Manual workflow
    Annual auditing by Bank / NGO
    Copy of transaction record put in drop-box
    Book-keeping done locally
    Admin updates records & prints balances & dues
    Weekly collections
    Annual auditing by Bank / NGO
    Weekly collections
    Goals
    • Improve data quality & aggregate data
    • 21. Automate weekly accounting function
    • 22. Create sustainable business model
    Methods
    • Have an Accountant with a PC, serve a Federation
    • 23. Charge nominal fee for data processing service
    • 24. Use manual transport to ferry data back and forth
    Results
    • Weekly meeting time cut by half
    • 25. Instant evaluation of financial performance of large group of SHGs possible
  • Models at Alhuda HDA
    • Donation Based Model
    • 26. Ethical Lending Model
  • Donation Based Model (Waqf)
  • 27. Waqf Process
    Lender
    Borrower
    Borrower
  • 30. Ethical Lending Model
  • 31. Ethical Lending Process
  • 32. Ethical Lending Process (Cont.)
    Lender
  • 33. Pooling
    • Purchase Requested Goods
    Lender 1
    Lender 3
    Lender 2
    Borrower
  • 34. Alhuda HDA Connects
    people through lending to alleviate poverty.
  • 35. Payback Process
  • 36.
  • 37. Thank You ……
  • 38. Thank You
    CENTER OF ISLAMIC BANKING & ECNOMICS
    Head Office: 192- Ahmad Block, New Garden Town , Lahore, Pakistan Ph: +92-42-35913096-8, 35858990, 38407850 Fax: +92 -42-35913056E-mail : info@alhudacibe.com
    Web: http://www.alhudacibe.com