Michael Gassner
Head of Islamic finance, strong in compliance and Sharia-compliance, board experience and educator
November 25, 2024
Dear Subscribers,
The mission of this newsletter is to facilitate understanding and application of Islamic blended finance, offering resources to support strategic planning and technical implementation for the international humanitarian and development organizations.
Please find below a brief summary of the report:
“I for Impact: Blending Islamic Finance and Impact Investing for the Global Goals”
The report was jointly published by the Islamic Research and Training Institute (IRTI) and the United Nations Development Programme (UNDP). It gives an overview about the technical buzzwords alien to people not familiar with Islamic finance yet, and thus helps to get started – a few examples below:
5th December 2024, 14.00-18-00 – “Islamic Blended Finance Workshop” in Geneva, Switzerland – contact us, if you are interested to attend.
Key Islamic Finance Instruments and Their Applications
1. Sukuk (Islamic Bonds):
– Utility: Provides a mechanism to raise capital for infrastructure, renewable energy, and other large-scale projects.
– Unique Aspect: Sukuk are asset-backed, ensuring compliance with the prohibition of interest while linking returns to tangible outcomes.
2. Murabaha (Cost-Plus Financing):
– Utility: Enables procurement by facilitating structured financing agreements between clients and financiers.
– Unique Aspect: Transparent, upfront pricing eliminates uncertainty, aligning with Islamic ethical standards.
3. Mudarabah (Profit-Sharing):
– Utility: Encourages entrepreneurial ventures by fostering capital-expertise partnerships.
– Unique Aspect: Reflects shared risk principles, with capital providers bearing losses unless negligence occurs.
4. Waqf (Endowment):
– Utility: Establishes sustainable income streams for education, healthcare, and social welfare initiatives.
– Unique Aspect: The preservation of principal assets ensures long-term project viability.
5. Zakat (Almsgiving):
– Utility: Directly contributes to poverty alleviation and wealth redistribution.
– Unique Aspect: Legally mandated, providing a consistent flow of funds for social development.
Implications for Strategic Development
Integrating Islamic finance principles into development initiatives can:
– Diversify funding sources with culturally relevant instruments.
– Build trust with communities by aligning with local values and ethics.
– Promote inclusive, measurable outcomes in alignment with global goals.
Access the Full Report
Explore the complete findings and actionable recommendations by downloading the report here: [Download the Report]
Building a Shared Vision
Each newsletter issue is designed to provide deeper insights into Islamic blended finance. Our aim is to equip you with knowledge to enhance strategy building and facilitate effective implementation. We invite you to consider how these tools can support your mission.
Let us continue this important conversation. How can Islamic finance instruments advance your objectives? Share your thoughts and experiences as we explore opportunities for impactful collaboration.
Warm regards,
Michael Gassner
Global Donors Forum
Islamic Blended Finance Workshop
5th December 2024, 14.00-18-00 – “Islamic Blended Finance Workshop” in Geneva, Switzerland – contact us, if you are interested to attend. The workshop is conducted in collaboration with MSF Switzerland and a Global Donors Forum regional event.
About MSF Switzerland
MSF Switzerland provides medical assistance in regions impacted by conflict, disasters, and healthcare exclusion, recognized for its needs-based, impartial approach to lifesaving aid.
About Global Donors Forum (GDF)
The Global Donors Forum connects philanthropists, social investors, and development experts, promoting impactful, collaborative solutions to global challenges. Next Global Donors Forum: April 14-16, 2025 Istanbul “Prosperity with Purpose – Investing in People, Planet and Peace”
#IslamicFinance #BlendedFinance #ImpactInvesting #EthicalFinance #UNSDGs
Categories: Islamic Banking, Islamic Finance, Islamic Guidance