1. World Islamic Finance Forum 2016
Towards Greater Financial Inclusion of Refugees in the Fourth Industrial Revolution: A Risk-sharing Based Islamic Financial Solution
Abbas Mirakhor
Alaa Alaabed
Ali Alaabed
World Islamic Finance Forum 2016
Karachi
September 5, 2016

2. Contents Problem and Context Solution: Islamic FinTech
An Equity-based Crowdfunding Mobile Application
Expected Impact
Possible Challenges

3. Problem and Context 50 million people displaced globally today.
Huge humanitarian and economic costs.
Highly-skilled population.
Refugees involuntarily excluded from accessing capital they desperately need.
The majority of those afflicted are Muslims. 3

4. Solution: Islamic FinTech
Risk sharing increases access to finance and promotes shared prosperity.
Access to smartphones hints at FinTech’s potential.
Peer-to-peer finance and innovative risk assessment models. 4

5. An Equity-based Crowdfunding Mobile Application
A direct flow model.
Enterprises’ upside and downside potential shared through equity/partnership contracts.
Efficient and just distribution assured through compliance with a network of rules (institutional scaffolding).
The option of interest-free loan (Qardh Hasan) to cater for participants of different risk-return profiles.
Auxiliary services/training.
Platform to perform certain gatekeeper functions. 5

6. An Equity-based Crowdfunding Mobile Application General key features
Eligibility Refugees looking to start micro-enterprises; and/or seeking self-employment opportunities.
Financing Size from USD500 to USD50,000
Purpose of Financing Working Capital or Capital Expenditure
Financing Capital Minimum No minimum required/ Alternatively USD50
Collateral Requirement No collateral requirement
Financing Application Minimum (as simple as 2 pages)
Financing Documentation Minimal documents, such as Identity Card, business plan. 6

7. Expected Impact Financial inclusion. Economic empowerment.
Social inclusion.
Peace and stability.
Shared prosperity.
Coordinated efforts among donors and international organizations.
Economic and financial relief of hosting and donor countries.
Socioeconomic development.
Inclusive Islamic finance. 7

8. Possible Challenges Awareness. Information management.
The possible risks of new approaches.
The difficulty securing a profitable and reasonably timed exit for equity positions.
Idiosyncratic risks 8

9. Thank you