Qard Hasan: A Lifeline For The Underprivileged
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What Is Qard Hasan?
“Who is he that will give Allah a goodly loan (Qard Hasan)? For Allah will increase it manifold to his credit.” [Surah al-Hadid, 11]
Qard Hasan is a loan extended on a goodwill basis, typically for social welfare or for short-term financing needs. The borrower pays back only the amount borrowed, with no interest or charges from the lender. Should a borrower encounter legitimate difficulty in making payments, the lender will extend the repayment time, or at times waive part or the whole remaining amount, depending on the situation of the borrower.
Keeping this in mind, GlobalSadaqah launched the Sustainable Charity Qard Hasan Program. This program aims to be a lifeline to empower and support small Malaysian social enterprises and the B40 community among others that have taken a huge hit in the Covid-19 pandemic.
The Covid-19 pandemic and the subsequent lockdown has hit the weaker sections of the society harder than the rest. Many of our brothers and sisters cannot even afford basic living amenities like food or being able to afford their house rents. Qard Hasan has immense potential to change our societies and empower the poor to stand on their own feet.
Empowering Single Mothers
The famous scholar, Ibn al-Qayyim said, “Women are half the Ummah and they give birth to the other half, so they are the whole Ummah.”
The building blocks and the very foundation of our society is based on how strong and empowered our women are. Keeping this in mind, one of the largest group of beneficiaries in this project are women. This would aim to facilitate financial inclusion, highlight the amazing work by our women at the grass roots level, and bring in help to empower them to become role-models for the upcoming generations.
Qard Hasan is a much needed program that opens doors for the needy in need of assistance to be free of high-interest loans and debt with punitive terms. Most of these beneficiaries don’t have assets to be deposited as a security with banks to be able to get a loan or even make it past the risk screening. This program opens doors of empowerment and self-sustenance for the poor and needy, majority of those who fall into the Asnaf categories.
This program aims to be a lifeline to empower and support small enterprises run by women and the B40 community, that have taken a huge hit due to the COVID-19 pandemic and economic slowdown in Malaysia. GlobalSadaqah aims to empower these communities by reducing the dependency on charity, and with the objective of turning beneficiaries into benefactors.
The Solution: AI Powered Social Finance
GlobalSadaqah has partnered with Alfie which is an alternative data intelligence company to build a digital lending app that focuses on social finance, targeting Malaysian B40 communities to provide seed funding for micro online shops. Targeted beneficiaries include single parents, housewives, unemployed graduates, newly unemployed, and casual workers. This collaboration gave birth to Money3 which is a digital lending app that integrates Islamic finance, AI/ML technology and e-commerce.
– Provide opportunities to the underserved communities to generate income.
– Build their credit profile
– Upskill our beneficiaries with e-commerce experience so they have a marketable skill set.
– Provide business management (i.e. setting up online shop, inventory packages,
campaigns and sales strategy)
– Training and coaching for all QH beneficiaries to use the app.
– Technology support, logistics, payment gateway etc.
GlobalSadaqah and its implementation partners screen, assess, and verify the beneficiaries meeting all KYC requirements. Donations to this campaign will form a pool for Qard Hasan that will then be loaned and transferred to verified and eligible beneficiaries. The loaned funds will be paid back by this first batch of beneficiaries and reused for the next batch of beneficiaries based in a set time frame.
The Messenger of Allah said, “Whoever relieves the hardship of a believer in this world, Allah will relieve his hardship on the Day of Resurrection. Whoever helps ease one in difficulty, Allah will make it easy for him in this world and in the Hereafter. Whoever conceals the faults of a Muslim, Allah will conceal his faults in this world and in the Hereafter. Allah helps the servant as long as he helps his brother. [Muslim]