Islamic micro-finance review: A special topic in finance

Abstract

The purpose of this paper is to provide a review of Islamic Microfinance and its application as a tool for poverty reduction, especially in developing countries. This system of financing serves as an alternative to the interest-based loans from conventional banks as well as conventional microfinance Institutions to the poor yet Islamic conscious millions of Muslims. This paper takes a descriptive approach and relied upon the available literature on Islamic Microfinance to highlight the different approaches used in different parts of the world. The conclusion from the review showed Islamic microfinance as doing well in poverty reduction, women empowerment, and being efficient in its operations.