FINCA Afghanistan is a

nonprofit A nonprofit organization (NPO) or non-profit organisation, also known as a non-business entity, not-for-profit organization, or nonprofit institution, is a legal entity organized and operated for a collective, public or social benefit, in co ...

microfinance Microfinance is a category of financial services targeting individuals and small businesses who lack access to conventional banking and related services. Microfinance includes microcredit, the provision of small loans to poor clients; savings ...

organization and an affiliate of

FINCA International FINCA International is a non-profit, microfinance organization, founded by John Hatch in 1984. FINCA is the innovator of the village banking methodology in microcredit and is widely regarded as one of the pioneers of modern-day microfinance. ...

. Its headquarters is in

Kabul Kabul (; ps, , ; , ) is the capital and largest city of Afghanistan. Located in the eastern half of the country, it is also a municipality, forming part of the Kabul Province; it is administratively divided into 22 municipal districts. Acco ...

Afghanistan Afghanistan, officially the Islamic Emirate of Afghanistan,; prs, امارت اسلامی افغانستان is a landlocked country located at the crossroads of Central Asia and South Asia. Referred to as the Heart of Asia, it is bordere ...

Background and history

FINCA Afghanistan was founded on August 1, 2003 through grants and loans supplied by several donors and funding agencies. Her Majesty Queen Rania of Jordan announced the launching of the program in 2002. FINCA Afghanistan began lending operations in the city of

Herat Herāt (; Persian: ) is an oasis city and the third-largest city of Afghanistan. In 2020, it had an estimated population of 574,276, and serves as the capital of Herat Province, situated south of the Paropamisus Mountains (''Selseleh-ye Safēd ...

on February 24, 2004. By the end of its first year in operation, the organization had reached over 4,500 clients, an outstanding loan

portfolio Portfolio may refer to: Objects * Portfolio (briefcase), a type of briefcase Collections * Portfolio (finance), a collection of assets held by an institution or a private individual * Artist's portfolio, a sample of an artist's work or a ...

of almost $700,000, and a repayment rate of 100%. FINCA expanded its operations to Kabul and Nangarhar in 2005, followed by

Balkh ), named for its green-tiled ''Gonbad'' ( prs, گُنبَد, dome), in July 2001 , pushpin_map=Afghanistan#Bactria#West Asia , pushpin_relief=yes , pushpin_label_position=bottom , pushpin_mapsize=300 , pushpin_map_caption=Location in Afghanistan ...

, Laghman, Kunar and

Parwan Parwan (Dari: ), also spelled Parvan, is one of the 34 provinces of Afghanistan. It has a population of about 751,000. The province is multi-ethnic and mostly rural society. The province is divided into ten districts. The town of Imam Abu Hanif ...

in 2006, and

Kunduz , native_name_lang = prs , other_name = , settlement_type = City , image_skyline = Kunduz River valley.jpg , imagesize = 300 , image_alt = , image_caption = , image_ ...

in 2007. In each of these provinces, FINCA established branch and market offices in the provincial capital, as well as outlying cities and districts.

FINCA Afghanistan's Islamic banking products

Since its inception, FINCA Afghanistan has offered a line of

sharia Sharia (; ar, شريعة, sharīʿa ) is a body of religious law that forms a part of the Islamic tradition. It is derived from the religious precepts of Islam and is based on the sacred scriptures of Islam, particularly the Quran and the H ...

-compliant microfinance products, developed after careful vetting with local religious leaders, and confirmed through a

fatwa A fatwā ( ; ar, فتوى; plural ''fatāwā'' ) is a legal ruling on a point of Islamic law (''sharia'') given by a qualified '' Faqih'' (Islamic jurist) in response to a question posed by a private individual, judge or government. A jurist i ...

acquired from

Al-Azhar University , image = جامعة_الأزهر_بالقاهرة.jpg , image_size = 250 , caption = Al-Azhar University portal , motto = , established = *970/972 first foundat ...

Cairo Cairo ( ; ar, القاهرة, al-Qāhirah, ) is the capital of Egypt and its largest city, home to 10 million people. It is also part of the largest urban agglomeration in Africa, the Arab world and the Middle East: The Greater Cairo metro ...

Egypt Egypt ( ar, مصر , ), officially the Arab Republic of Egypt, is a transcontinental country spanning the northeast corner of Africa and southwest corner of Asia via a land bridge formed by the Sinai Peninsula. It is bordered by the Mediter ...

. FINCA Afghanistan's

Murabaha ''Murabaḥah'', ''murabaḥa'', or ''murâbaḥah'' ( ar, مرابحة, derived from ''ribh'' ar, ربح, meaning profit) was originally a term of ''fiqh'' (Islamic jurisprudence) for a sales contract where the buyer and seller agree on the m ...

loan products are based on an agreement where the seller (FINCA) expressly mentions the cost incurred for the commodities to be sold and sells it to another person (the client) at a markup on the original cost. It is one of the most popular modes of exchange used by banks in Islamic countries to promote interest-free transactions (interest being forbidden by sharia law). Aside from being Afghanistan’s first sharia-compliant microfinance organization, FINCA can perhaps claim to have created one of the world’s first Murabaha group-lending products.{{citation needed, date=April 2012

Partnerships

FINCA Afghanistan is a board member of the Afghanistan Mircrofinance Association (AMA).

References

External links

FINCA's Official Website

Microfinance Investment Support Facility for Afghanistan
(

MISFA The Microfinance Investment Support Facility for Afghanistan (MISFA) was set up in 2003 at the invitation of the Afghan government to streamline collection of donor money and avoid pitfalls arising from conflicting donor interests that had been ...

) Microfinance organizations Organizations established in 2003 Non-profit organisations based in Afghanistan

Background and history

FINCA Afghanistan's Islamic banking products

Partnerships

See also

References

External links