islamic micro finance model - by omar mustafa ansari

International Conference on Islamic Micro Finance21-22 July 2009

Proposed Islamic Micro Finance Bank ModelOmar Mustafa Ansari - FCA

الرحیم ٰم�ن الرح اللہ بسم

The honorable chairman of the session,Distinguished guests,Ladies and gentlemen

برکاتہ و اللہ رحمۃ و علیکم السلامAt the outset, I would like to thank the organizers of this august forum and the management of Riphah University for providing me this opportunity to share my thoughts with you.

You may consider my ideas and thoughts to be more on the optimistic or idealistic side, but let me accept that by having an opportunity of being a part of the present day Islamic financial system, I would rather prefer to be optimistic. At least I am able to say, in the words of Martin Luther King, Jr. that “I have a dream”…. And I love to see dreams like this…

I would like to say that we as a country are facing one of the most crucial times in our history on the political front, as well as, on the economic front. In these difficult times, it is a need, that economic activity be initiated at the grass root level, by pooling resources and providing means of living and mutual benefits to the poor and needy people. This will provide the poor but capable people of Pakistan, an opportunity to find their destiny, in form of economic sustainability, self-sufficiency and prosperity, and all of these within the parameters defined by the Creator of this world. And this understanding compelled me to do what I can do in visualizing a model for that.

Another reason for this endeavor, is that Islamic finance and banking is a progressing commercial venture in the world. It is a viable business, as well as, an avenue providing a shelter to the Muslim Ummah against Riba and other prohibited financial transactions and businesses. At the same time, this system, at present is facing a number of objections. And through a proposed model I want to do some service to Islamic Finance.

Basic Arguments Against Islamic Banking

The basic objections against Islamic banking may be categorized in two, though inter-related, yet separate categories:

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1. The first category of objections is primarily focused towards alleged, and to some extent real, compromises on Shariah compliance. So we may also say that these objections are generally on grounds of Fiqh i.e. principles of Islamic jurisprudence, with regard to what is permissible and what not; and

2. The second category of objections is more focused on the economic and social objectives of Islam. In these sort of objections, the focal point is the inability, or rather failure, of present day Islamic banking and finance in making contribution towards a just and equitable economic and social system, as required by Islam.

Since we have to stick to our topic today, hence, we have no time to go into detail for such objections and to discuss arguments and counter-arguments for the same. But I would only like to say that this effort is intended to be free from these objections.

My Vision about Islamic Economic System

According to my poor understanding of the subject, Islam requires well-being of humankind in a just and equitable manner. Islamic economic system remains dependent on the principles of life defined by Allah Almighty. All the wealth and resources belong to Allah Almighty, who has granted their right of usage to the human beings, with guidance for their use.

This system does not prohibit anybody to earn, save and invest, and allows individual ownership rights to an individual in his life, and at times even makes it mandatory to earn livelihood for an individual. At the same token, this system puts hurdles and prohibitions on earnings through impermissible activities (which are primarily against the overall social and economic objectives), as well as, discourages uncontrolled concentration of wealth in individual’s hands.

This system, when in operation, does not accept anyone living his life below the poverty line. It gives right to individuals on the common resources, and establishes a passage of drain of wealth and resources within the system and from rich to poor.

This system encourages trade and commerce and promotes every individual to play his role in the socio-economic cycle.

The basic tools used by this system to achieve its objectives include, without limitation, the tools like Zakat and Ushr, Sadaqat and Khairat, Khums, Fay, Khiraj and Jizya, as well as, law of inheritance and discouragement of being miser and stingy.

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On the other hand this system puts prohibition on elements like Riba i.e. interest of all kinds and types, Gharar i.e. excessive uncertainty; and speculative and gambling activities. It also prohibits unfair trade practices, including exploitation, speculative trade practices, use of false statements and hoarding.

Side by side, this system also encourages elements of socio-economic mutual benefits, like Qard-e-Hasana, Wadia, Aariya, allowing time on repayments, Diyat e Aaqila and so on, so forth.

Due to scarcity of time, I would like to call your attention towards just one matter i.e. we have to be mindful of the fact that Riba is impermissible, in all forms – so our transactions have to be interest-free. It is also noteworthy that Riba is one of the worst sins, a human can commit i.e. due to its severity, it has been construed as a war against Allah Almighty and His Messenger.

Also keep in mind that interest irrespective of amount – is prohibited and remains prohibited by whatever name called. By calling it mark-up, profit, service charge or fee, you can’s turn it Halal. It can also not be linked with exploitation.

Significance of Qard in Islam

For today’s discussion, we particularly need to emphasize on the significance of Qard-e-Hasana which has been given more preference than donations in the Islamic social and economic system. It is our understanding that the Qard has been given preference over donations, for many reasons particularly including that:

1. In asking for Qard, the person is more likely in real need as compared to donations because donations make a person fond of easy money;

2. In case of donations, the recipient more often turns out to be a futile part of the social and economic system;

3. The self-confidence, self-esteem and ego of the person obtaining Qard, though does not remain intact, but not even get hampered like donation and outright charity.

4. Availability of Qard always ensures availability of money without any charge and this reduces the element of creation of money without productive activities and in turn, restrains inflation and factors resulting in concentration of wealth.

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Need of Islamic Micro Finance

I have a firm believe that Micro Finance is a need of time, duly debated, discussed and established. In addition, even experts with conventional mindset conclude that in countries and societies like ours, an Islamic variant of Micro Finance is mandatory to attract and appeal the masses.

Experiences of Islamic Micro Finance in Pakistan

In Pakistan, even the conventional Micro Finance has not yet reached any respectable level, let alone Islamic Micro Finance. It would not be an exaggeration to say that the current status of Islamic Micro Finance in Pakistan, is far below than a good beginning.

But this is not the only problem, as other issues are also arising with regard to the operational model, as well as, Shariah compliance. It is worthwhile to mention that everything claimed to be Islamic, particularly in the fields of banking and finance, is not necessarily Islamic.

My objective is not to challenge the practices presently being followed; but mind me, it is not just a passing remark, but a genuine serious issue that the Islamic Micro Finance practices in Pakistan have severe Shariah non-compliant features in the policy, product, documentation and execution of the transactions. Moreover, the customers and staff of these institutions, require a great deal of knowledge, information and guidance for executing truly Shariah compliant transactions.

Difference between Our Model and Conventional Micro Finance Bank

I feel that we now already have done enough discussion on the background, and now should proceed to the summary of the proposed model:

1. The first and the foremost point to mention is that this proposed IMFB model is a mix of commercial and benevolent objectives;

2. Secondly, a conventional micro finance bank, is an institution dealing in interest, which is inviting the anger of Allah Almighty. Our model, on the contrary is based on the principles of Shariah with a commitment that we shall not go for anything less-than-preferred;

3. Thirdly, we have a significant emphasis on the Qard-e-Hasana for personal loans, as well as, in certain cases on the commercial financings;

4. Lastly, we have a significant emphasis on the Micro Takaful and mutual benefit system, as an integral part of our model.

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What sort of financing facilities will be aiming to provide?

Whatever financing facilities we will be providing will be different in nature for each category or segment of the society and will differ in different geographical locations, also. We may divide these facilities in different categories. Following are a few basic examples of such facilities which may be provided to different categories of customers:

In rural areas:

o Use of Salam, for agricultural needs e.g. seed, fertilizer and pesticides;

o Use of Istisna and Salam for women having capability of establishing a small domestic commercial setup

o Use of Murabaha or Musharaka for domestic animal farming

o Use of Murabaha, Ijarah or Diminishing Musharaka for farmers – individually or collectively – for providing access to agricultural machinery and technology

o Financing under various modes for farmers for having access directly to the market, and thus avoiding excessive commissions and intermediary profits charged by the middle men

o Financing through Musaqa or Murabaha – for tree-plantation

o Financing through Ijarah or Diminishing Musharaka – individually or collectively – for Bio-Gas infrastructure and machinery

In urban areas, including katchi abadis and suburbs

o Financing through Salam for small-scale farming

o Financing through Musharaka or Murabaha for cattle farming, poultry farming or fish farming

o Financing for small shops through lease – sub-lease model or through Diminishing Musharaka

o Financing through Musharaka for small businesses e.g. supply of retail items, supply or shop of fruits and vegetables etc.

o Financing for small tea-shops, food-item stalls and bakery products on Musharaka, Modaraba or Murabaha basis

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o Financing to electricians, mechanics, plumbers, carpenters, painters and other skilled labor or blue-collared professionals for setting up their shops and on-call services through Musharaka and Murabaha

Financing for women, particularly emphasizing on widows and those without having any earning member in the family:

o Financing for supply of lunch and foods items in offices and commercial areas, or on bakeries and shops for sale on the basis of Musharaka, Modaraba or Murabaha.

There is a long list of avenues and opportunities, as well as, the options which can be utilized to fund such requirements, but the scarcity of time does not allow us to go in further details of the same.

Conditions for the Commercial Financing

Our proposed model does not have the sole-objective of profit-maximization, hence our rates of profits for fixed return financings will be significantly less than the rates offered in the conventional banking. We feel that since in the beginning years, it will be enjoying a tax holiday, hence, it is commercially sustainable to charge comparatively lower rates of profit. Even then, it is expected that this short-fall will be covered through better profit margins in variable rate and participation based products.

In case of Murabaha, Ijarah and Diminishing Musharaka i.e. the fixed return based products, the rate of profit will be somewhere around K-2% to K-3%.

In case of Salam and Istisna, the expected profit ratio would be within the same range. But, we are not going to virtually fix the return, so the difference between the actual and expected selling prices would relate to the IMFB.

As a result such transaction would entail a variable rate of return, more or less, within the range defined above. This, you would appreciate, is in line with the essence and spirit of Islamic economic system.

I would also like to propose that in case of Musharaka, the Bank’s share as a dormant partner would, in any case, not exceed 60% of the proportion of the Bank’s investment in the venture. This proposed condition is stricter than the condition imposed by Shariah.

Financings would be generally for short to medium term i.e. from 3 months to 2 years. However, in certain cases the tenure may be increased upto 5 years. It will be our endeavor to identify short to medium term, projects which are more viable, productive and result-oriented.

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Difficulties in Deposit Mobilization

Since all these transactions will be based on profit and loss sharing, hence, there arises a risk that the return being offered by the IMFB on its PLS deposits would theoretically be less than the rates being offered by conventional banks and Islamic banks. This may cause problems in deposit mobilization for the IMFB. Consequently, it may be said that common depositors would not be attracted by this IMFB and it will have to emphasize on two categories of depositors:

1. Those who would like to be a part of the objectives of this IMFB, and for this purpose, the would even be willing to sacrifice a part of their profits; and

2. The population from the target area – who will be able to reap additional benefits from the operation of IMFB in their area, including the benefits of Micro Takaful.

However, it is just a risk and the theory suggests that since our maximum efforts will focus on separation of charitable purposes from the commercial venture, hence, the commercial venture of its own, will remain a viable and feasible business.

Loans for Personal Need

Loans for personal needs may be divided in two different categories i.e.:

1. emergency and urgent needs e.g. against medical needs, for repair of house in catastrophe or during unemployment period; and

2. the long-term needs e.g. construction of house, boring for water or higher education of children.

Loans for urgent and important personal needs will preferably be provided on Qard-e-Hasana basis. However, taking care of the ground realities, if the Qard Fund can not support any such transactions, then any appropriate financing transaction may be applied.

However, in case of long-term personal needs, particularly those involving purchase of construction of an asset or property, generally the financing models will be preferred e.g. Diminishing Musharaka for construction of house. However, this general principle will not be applied for education and similar requirements, which still, will preferably be provided through Qard-e-Hasana and funded from the Qard Fund.

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Commercial Micro Finance Transactions

Commercial Islamic financing transactions would include products like, Qard-e-Hasana, Modaraba, Musharaka, Murabaha, Salam, Istisna, Musawwama, Istijrar, Muzaraa, Musaqa, Ijarah, Ijarah Muntahia Bittamleek and Diminishing Musharaka – Ijarah.

Here arises the question as to how Qard will be used for financings for commercial purposes. For that we have two conditions:

We can not finance major amounts in Qard i.e. the amount required should be very minor or negligible – e.g. in the beginning this may be set at the level of Rs. 10,000; and / or

The financing shall be used for some purpose providing significant social benefit – e.g. in providing financing for a private school, madrassa, book shop, dispensary or clinic (even with profit-motive).

Limitations to be laid down for Qard-e-Hasana

Our IMFB cannot work solely, or even primarily, on the basis of Qard because of:

1. inflation effect, which will shrink the purchasing power of funds available;

2. bad debts and non performing assets which will reduce the pool size; and

3. administrative efforts involving economic outlay resulting in shrinkage of pool size.

Accordingly, we will have to develop a model catering these issues also.

A Qard Fund will be established, primarily managed and controlled by the Trust to provide Qard-e-Hasana for personal, as well as, certain commercial needs. This fund will be held by the Trust in a special current account with the IMFB or Qard TFCs will be issued there-against to reap benefit of supplementary capital. This Qard Fund will also be sharing certain expenses of the IMFB incurred in respect of Qard transactions.

The Trust will also allow the IMFB to use a portion of such fund e.g. 20% thereof, in its commercial transactions which will provide sustainability to the IMFB.

It will also be a policy of IMFB to deploy a portion of current accounts say 40% thereof, in disbursing Qard. This will not have any additional cost on the IMFB, and will enable it to continue with its Qard transactions, without additional cost.

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This will, nevertheless, reduce the profitability of IMFB against other competitors who are not so generous. IMFB, as a mission, will ensure that the maximum of funds it receives are received in the current accounts, and for this specific publicity campaigns will also be launched.

Similarly, Qard TFCs may also be issued to the public at large. It will have benefits to the IMFB and the overall mission, in various forms and will prove sustainability and growth, as well as, will support in capital requirements.

IMFB will also request its investors to re-invest their respective dividends in current accounts, till the time they don’t personally need them or to put them in the Qard Fund maintained by the Trust. This will enhance the fund base available for the providing Qard.

Is it commercially feasible?

It may be premature, or even may prove to be incorrect, in extreme circumstances, to conclude with significant certainty that this project will provide “sizable” returns at commercial level, looking at the same from a “capitalistic mindset”.

Having said that, at the same time, it needs to be said that this plan includes at least two facets which will significantly contribute to the profitability – on the commercial side. The first one is that the level of fixed expenditure has been set at the lowest possible level. The second one is that the charitable aspect and not-for-profit activities including the Qard-e-Hasana mechanism has been set in a china-wall style through which it will be ensured the charitable and not-for-profit activities remain self-funded and do not hamper the commercial viability and profitability of the project. Even we have suggested a model of payment of receivables against genuine defaults through Zakat. In addition, at this point of time, a tax benefit is also available to Micro Finance institutions which will also improve the bottom line.

But these arguments are not enough. This model is not just meant to become a profit-earning device for a bunch of capitalists. This, instead, is a model suggested for those who pray to Allah Almighty for the best returns in this life, and the life hereafter. Even if all the returns are kept by Allah Almighty for the life hereafter, we expect that they are not going to say that it is a deficit case.

Establishment of Islamic Micro Finance Bank (IMFB) – Corporate Setup

Such a bank is intended to be established in line with the requirements of the State Bank of Pakistan in respect of establishment of an IMFB. SBP has laid down the minimum capital requirements for an IMFB, according to which for

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the purpose of license for the whole country, a minimum capital of Rs. 500m is required.

There is, nevertheless, probability that if the sponsors are not able to provide complete capital as per their respective requirement, they may provide 51% of capital and then refer to the general public in form of IPO of the IMFB, or through private placements.

Even if, any organization or a group of people is willing to do this sort of effort, and they do not have sufficient capital available, even then, they can take start through forming a cooperative society, which may, in reasonable time be transformed in IMFB. However, there shall remain a number of legal impediments on the operation of the cooperative society.

As an alternate, a cooperative society model may be applied, which will be based on self-sufficiency within a reasonable time.

Additional capital may be arranged through Musharaka, Modaraba and Qard based Term Finance Certificates (TFC) or Sukuk.

Establishment of Trust

A Trust will be established, side-by-side, with the establishment of IMFB. This Trust will be responsible for most of the charitable and philanthropic work of the project. For this purpose this Trust will mobilize funds in form of:

Donations – Zakat, Ushr and Sadaqat

Voluntary or Mandatory – Zakat on the funds of Shareholders and Depositors of the IMFB, in line with a mechanism not contrary to local law

Charity or self-imposed penalty income from Islamic finance operations

Qard – obtained from public and masses, primarily for the IMFB’s Qard operations

Trustees and management of the Trust would be separate from the IMFB’s management. However, representation of IMFB’s BOD and the SSB, will be ensured in the Trust through one ex-officio Trustee each, from both of them.

Objectives of the Trust will also include establishment of a not-for-profit educational institution having focus on the training of basic knowledge of Islamic finance to the employees, volunteers, partner organizations and customers of the IMFB.

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All the funds of the Trust will be held with the IMFB in different current accounts according to their nature.

Besides other uses of Zakat Fund, in line with customary practices, a key use of Zakat and donations will be in payment of debts of genuine insolvent debtors or customers of the IMFB. This will however, always be subject to approval of the Trustees of the Trust. This will significantly reduce the default and NPL rate, and additionally, will provide support and strength to the customers of the IMFB.

In addition, in cases where financing is not feasible or possible, direct financial support will also be provided by the Trust.

Who will provide capital?

Capital will be sourced and pooled through all possible sources, and will be categorized in the commercial capital and mission-oriented capital. Our business model will be ensuring market compatible returns for the commercial capital and the less-profitable activities will be catered through different kinds and types of mission-oriented capital, whose primary motive is social, rather than economic.

Limiting the Infrastructure: Thus Saving Costs

We will make all efforts to minimize the infrastructure and, consequently, becoming able to control costs and not to commit major employee cost, as well. For all functions, which may be performed through outsourcing, will be outsourced. These functions, e.g., may include Product Development, Shariah Compliance , Accounting and book-keeping, secretarial work, internal audit and internal Shariah audit, system development, data entry and security.

This will save staff fixed cost in the beginning, till the time the IMFB is able to invest further on the human capital and infrastructure.

Number of branches of the IMFB shall also remain minimum and the field units, partner organizations and a network of volunteers will be filling in the gap. In addition, window based setups can be arranged with one or more Islamic commercial banks for providing network support and save the infrastructure costs.

Role of Partner NGOs and Volunteers

As a result of this sort of business structure, this IMFB will be more and more dependent on the partner NGOs and network of volunteers.

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Arrangements with NGOs and partner organizations will be similar to those prevalent in the industry, except for the fact that we might have to remain vigilant in identification of suitable NGOs who have a similar sort of mindset for the efforts for development of an Islamic social and economic system.

This IMFB will also develop a network of volunteers, who will be providing a number of services on honorary basis. However, on a business case basis, honorariums may also be paid to some or all of the volunteers. These volunteers will be provide a number of services particularly including the background check for customers, transaction executions support e.g. as agent of the IMFB, providing guarantees to the customers and at times providing guidance and support in accounting and book-keeping, where required.

We will try to identify volunteers who have good credibility in the society and have a social position providing them a suitable knowledge about the members of a specific population group. As an example, we may identify good volunteers amongst school teachers, Hakims and Imams.

Difference with Contemporary Islamic Banking

In the commercial ventures and investment or financing opportunities, it will be our endeavor that a maximum of such transaction should be based on profit and loss sharing, in the true spirit of Islamic finance, and thus paving the way for a true Islamic economic system.

Keeping eye on the ideal state, by the same token, we will also consider the practical issues in implementation of a profit and loss sharing based financing and investment mechanism. In this respect, particular attention would be given to the application of Musharaka and Modaraba, to the maximum extent possible.

Even, while applying other contemporary Islamic finance options, it would be emphasized that the level of Shariah compliance and preferred treatments should remain high and, “allowed alternative treatments”, should be avoided as far as humanly possible.

For that, we can take just a few examples, like:

Trade based modes of Islamic finance, including Murabaha, Salam, Istisna and Istijrar in which we can avoid a number of “not-preferred” matters which have become an integral part of our contemporary Islamic finance transactions.

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We will try to reduce resemblance with the conventional financial products including use of conventional interest rate benchmark, as a benchmark for pricing.

It will be our endeavor to avoid appointing the same person as agent for procuring and selling the goods, and taking delivery thereof, on behalf of IMFB. Instead of that, respective volunteers, guarantors or any other person will be requested to be appointed as the agent.

Only Takaful will be used for risk sharing, instead of conventional insurance.

Governance Structure

We would like to suggest having a good Shariah Supervisory Board (SSB), having representations from multiple disciplines and schools of thought, instead of a single Shariah Advisor. We would also like to suggest that to strengthen the governance process, the SSB should be elected by the shareholders in AGM.

We also suggest that the Board of Directors (BOD) of the IMFB should also have representation from technocrats, minority interest and an ex-officio representative from the SSB.

Social Responsibilities

We will also put significant emphasis on the social responsibilities besides providing Micro Finance and Micro Takaful services. Even while providing these services; it will be our endeavor to emphasize on the social objectives, including education, health and medical facilities, and providing support for discouraging drug-addiction and beggary.

Micro Takaful and Mutual Kafalah System

In our proposed model, the Micro Takaful and Mutual Kafalah System has much more significance as compared to the prominence given by a conventional micro finance bank in respect of micro insurance. We can rather say that it is an integral part of our proposed model, rather than an ancillary product attached to Micro Finance business. The objective is that the target group of population should be provided an opportunity of putting their first step on the way of self-sufficiency, leading eventually to prosperity.

One of the prime reasons for giving such prominence to the same is that generally a rich or a well-off person always has to face major risks, but generally the probability of the risk of bankruptcy of such a person by virtue of

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a single risk is quite minimal. Reason being, that such person generally has a portfolio of assets, including personal assets and properties and hence even in case of business failure or a major loss, he is able to survive. Obviously not at a level at which he previously was, but still better than the masses.

On the other hand, a poor and needy person, even if he is self-sufficient in his earnings and expenditure hardly has any room for absorbing even a small risk like personal or family-member’s illness or a loss of shelter in catastrophic situations. Such a person immediately falls below the line and turns out to be a burden on the society through un-employment and other relevant and ancillary factors. Further to that, his family also immediately starts suffering which may include e.g. disturbance of children’s education, and so on. Keeping in view these real-life situations, it will remain a focal point for our project.

However, we may not be able to start a full-fledged Micro Takaful entity at the beginning. It, nevertheless, does not mean that we want to ignore this job at this stage, but, we would like to establish a working connection with one or more Takaful companies operating in the country. If it works out properly, then this arrangement may continue in future also, as we do not want to be Jack-Of-All-Trades. Nevertheless, since the present day Takaful business is established with profit motives, we may have to avoid a few of its ancillary functions, to make it compatible with our model.

Objective of Micro Takaful Project

Here we have the next question, as to what objectives this proposed Micro Mutual Takaful system will aim to achieve?

Answer to this question, is not very simple to be summarized. Our eventual aim, shall remain to establish a complete mutual benevolence system in the whole country based on the principles of Takaful and mutual Kafalah. It will also encourage saving schemes, and resultantly will also become supportive to the IMFB through enhanced resource base. Principally, we will like to collectively share the risks of financing losses and saving needs relating to medical, education, catastrophes and death of earning member of the family.

Conclusion

Now, I would like to summarize in a few words, at the conclusion of this paper, the vision and mission of this project.

Whereas, we have full faith and believe that Allah Almighty has not created the mankind without any purpose. We also feel that as a part of these purposes, it is the responsibility of the whole society as a Fard-e-Kifaya to ensure that avenues are always available for providing help, both financially and socially,

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to its poor and needy part, along with a system of mutual benevolence for them.

We firmly believe that through establishment of this model IMFB and through implementation of a system of Islamic Micro Finance and Micro Takaful, we can contribute something to the society and make some efforts to fulfill the responsibilities that Allah Almighty has bestowed on us, as individuals and collectively as an Ummah. We feel that this model can contribute positively towards establishment of a just and equitable social and economic system, that can bring happiness and prosperity for us in this worldly life and in the life hereafter.

In the end, I would like to pray to Allah Almighty to help us in our efforts, and make all such efforts fruitful, in this worldly life, as well as, in the life hereafter.

Thank you for your patience, and

برکاتہ و اللہ رح�ۃ و علیکم السلام

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Short Profile: Omar Mustafa Ansari Partner – Islamic Financial Services Ford Rhodes Sidat Hyder & Co. Chartered Accountants A member of Ernst & Young Global Ltd.

Omar is Chartered Accountant and a fellow member of the Institute of Chartered Accountants of Pakistan. Omar’s area of specialization includes services in Islamic finance industry. He is currently heading Islamic Financial Services Group of Ford Rhodes Sidat Hyder & Co, Chartered Accountants, A member of Ernst & Young Global Ltd. Previously, as an audit client service partner, he was serving a portfolio of clients in Islamic finance industry. His clients include various Islamic banks, Takaful companies, Mutual funds and Modarabas.

Apart from advisory and audit related activities, Omar is the author of a book “Managing Finances – A Shariah Compliant Way”. The book has been widely welcomed as a source of conceptual and practical guide by Islamic finance experts, bankers and practitioners.

Omar has been one of the key speakers and a trainer for training courses for Islamic bankers arranged by the National Institute of Banking and Finance (NIBAF) and has delivered courses and lectures at various professional and training institutions.

Omar is presently serving as an alternate member on a Committee of the Securities and Exchange Commission of Pakistan formed for revision of the Takaful rules and ICAP’s Committee for Development of Islamic Financial Accounting Standards.

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islamic micro finance model - by omar mustafa ansari

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