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Islamic Micro
Housing Finance –
Akhuwat Model
May 29, 2015
Dr. Muhammad Amjad Saqib
Chairman - Akhuwat
Section I
Akhuwat – an Organization for Interest Free Microfinance
Akhuwat
Akhuwat was established in 2001 with
the objective of providing interest free
micro-credit to the poor so as to start a
business, come out of poverty and
enhance their standard of living.
‘Akhuwat’ means brotherhood
or solidarity with the poor and less
advantaged.
VisionA poverty free society built on the principles of compassion and equity.
MissionTo alleviate poverty by empowering socially and economically marginalized families through interest free microfinance and harnessing entrepreneurial potential, capacity building and social guidance.
How Akhuwat is different?
Microfinance is not a new strategy but Akhuwat is different because of;
Interest-free loans – Qard e Hasan Use of Religious places Spirit of Volunteerism Transforming Borrowers into Donors
Map of Pakistan
Achievements Total amount disbursed: PKR 16
billion Total borrowers :
850,000 Offices in Pakistan: 350 Recovery Rate :
99.8 %
Staff : 2,000+
Cities: 210
A new model in the world of MF
Included in the syllabi of two Universities
BEYOND MICROFINANCE
1. Akhuwat Microfinance (Qard-e-Hasan)
2. Akhuwat Health Services
3. Akhuwat Educational Assistance Program
4. Akhuwat Volunteers
5. Akhuwat Khuwajasira Support Program
6. Akhuwat Clothes Bank
7. Akhuwat Dreams
8. Akhuwat University
9. Akhuwat Interest Free Housing Loan Programme
Section II
Interest Free Housing Loan Programme
in collaboration with
Al-Noor Umar Welfare Trust
Silent Features
Interest Free Housing Loans for construction, renovation and repair of rooms, roofs, walls etc.
Loan ranges from Rs. 30,000/- to Rs. 100,000/- Repayment within two to three years Locality – Poor Areas / Slums Incremental Loaning
Purpose is to provide Housing Facility &
security to the poor
Improve Standard of Living
Eligibility Criteria
Borrower owns a plot not exceeding 4 Marlas. Family income does not exceed Rs. 20,000/- Does not own another house Preferably a previous borrower of Akhuwat Good social capital Has regular source of income
Progress Report
Progress Indicator Till April 2015
Total Amount Disbursed Rs. 46 Million
Total No. of Loans Disbursed 723
Active Loans 227
Outstanding Loan Portfolio Rs. 36 Million
Recovery Rate 100%
Name Yasmeen Jameel
1st Loan Rs. 75,000/-
Disbursement Date June 2013
2nd Loan Rs. 100,000/-
Disbursement Date Nov 2014
Purpose Construction & Renovation
Name Anees Akhtar
1st Loan Rs. 70,000/-
Disbursement Date
June 2012
2nd Loan Rs. 100,000/-
Disbursement Date
Nov 2014
Purpose Construction
Name Shoukat Ali
1st Loan Rs. 70,000/-
Disbursement Date
June 2012
2nd Loan Rs. 100,000/-
Disbursement Date
Feb 2015
Purpose Full House
Name Iftikhar Ahmed
Loan Rs. 70,000/-
Disbursement Date
February 2015
Purpose Roof and Plaster
Name Muhammad Sadar
Loan Rs. 80,000/-
Disbursement Date
Nov 2014
Purpose Full Room
Name Mansoor Elahi
Loan Rs. 60,000/-
Disbursement Date
August, 2014
Purpose Full Kitchen
Name Muhammad Waseem
Loan Rs. 80,000/-
Disbursement Date
Dec 2013
Purpose Finishing of House
Name Muhammad Ibrar
Loan Rs. 80,000/-
Disbursement Date
December 2013
Purpose External Walls & Door
Name Riffat Shaheen
Loan Rs. 100,000/-
Disbursement Date May 2015
Purpose Roof of Kitchen & Doors
Name Salman Shaukat
Loan Rs. 80,000/-
Disbursement Date
Feb 2015
Purpose Roof of a Room
Section III
A New Loan Product for Mithi District, Sindh
Context
Mithi is the Headquarter of
Tharparkar District in the Sindh
An estimated population of 1,481,643 (2012)
Estimated Households are 211,000 44 union councils & 2,357 villages
Literacy Rate 18.32% for men and
6.91% for women
One of the Priority Area
During recent visit and Rapid Need Assessment to District Mithi and adjourning area, Akhuwat Team observed inadequacy of Housing units.
A typical house consisting of 2 Rooms plus Bathroom costs around
PKR.100,000
Solution
Creation of initial fund of PKR. 100 Million that will revolve as
Interest Free Loan to eligible poorest household to construct their houses.
Eligibility Criteria
Those household will be selected who
fall in the range of 0 – 20 on poverty score card
Also have the capacity to return in
easy installments in 2 – 3 year’s time.
Either the family does not have a house or the house is in a dilapidated condition.
ProcessSelection of 10
to 20 settlements, within close proximity
Identification of Eligible
Households from these settlements
Agreement with the
Households
Designing of the House as per available land and cultural environment
Release of First
Installment to Family
Technical Support and Supervision
of construction
Release of 2nd Installment
Completion of the
construction
Revolving Funds
A fund of PKR. 100 Million will be raised from the philanthropist / institutional donors.
The construction will start once PKR. 10 Million is available in the fund. (PKR. 5.1 Million is available)
Funds will be utilized through interest free loan scheme to the owner of such houses.
It is expected by revolving this amount
around 1,500 units will be built every year
Implementation
The fund will be raised and managed by Akhuwat
The process of identification of eligible candidates, technical support in design and construction may be out-sourced to a third party familiar with socio-economic conditions of the locality.
Operational Cost
Operational Cost is expected to be
10% of the total amount This amount will be raised separate
from the revolving fund. The households may also contribute in this.
Replication and Expansion
Once the program is implemented successfully a review and impact assessment will be conducted within
One Year, and the program will be replicated in other parts of the this districts and neighboring districts.
Loans Advanced so far…
Please contact us
www.akhuwat.org.pk
19 Civic Center Sector A-2, Township, Lahore
Phone # 042-35122743, 35112146-47