Islamic microfinance as a means of financial inclusion in the Gambia

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Islamic microfinance serves as an alternative to providing financial services to SMEs, a poor segment of the society who has no access to conventional financing. Conventional microfinance in the Gambia has failed to meet the demands of the poor principally because of the exorbitant interest rates, unrealistic collateral, religious exclusion, and its (conventional microfinance) concentration in the urban centers. Roughly 61% of Gambia s population lives in absolute poverty, and 64% of that lives in the rural areas. The Gambia is considered the most financially excluded country in the world and the majority who are Muslims some of which believe that interest is prohibited. Therefore interest-free financing such as Islamic microfinance (IMF) will help spur financial inclusivity in the Gambia. This study is aimed at gauging the efficacy of Islamic microfinance as a means of financial inclusion in the Gambia. A quantitative approach was adopted in this paper with a survey conducted to collect primary data from 108 respondents. The findings show that majority of the people are not aware of the Islamic finance products and services being offered by IMF but are aware of the existence of IMF. The findings further revealed that there is a lack of accessibility of IMF, it also showed that zakat is significantly correlated to IMF. It also revealed that Technology is significantly correlated to IMF to spur financial inclusion. The proposed model strictly focused on using faith-based organization (FBO) to transition people from chronically poor to economically poor as the commercial model adopted by prevailing IMF is not effective. Additionally, it has within its takaful scheme a risk mitigation for both the clients and the IMF. Most importantly the model has social service which is inculcated in the model to advise clients on their money management, checking business viability for clients as well as how to use mobile money for their daily transactions and payments.
Islamic microfinance , Zakat , Awareness , Technology , Financial inclusion , The Gambia , Project paper (MSc)
Camara, A. O. (2021). Islamic microfinance as a means of financial inclusion in the Gambia (Master dissertation). INCEIF, Kuala Lumpur. Retrieved from

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