ISLAMIC MICROFINANCE: MOVING BEYOND FINANCIAL INCLUSION

The current situation of high unemployment and the widening whole of the disadvantaged people in Muslims countries have awakened the need for proper access to microfinance. Currently, poor and low income people in Muslim countries have little access to either conventional or Islamic microfinance. This article is an attempt to investigate to what extend Islamic microfinance can best help in alleviating poverty in Muslim communities. The results showed that conventional microfinance concentrates on the lowincome group. However, it excluded the destitute people from microcredit and other related activities such as saving and skills improvement both financially and socially. Furthermore, the result indicates that Islamic microfinance is moving beyond conventional counterpart to provide effective social and financial inclusion simultaneously. This is done through Islamic social tools such as Sadaqah, waqf, and Zakah, which is to be given directly to the extremely poor either in cash or in kind to satisfy their basic needs before granting them microcredit.Thus, these results are a good motivation to those who provide microfinance in these countries to improve the social and financial inclusions of the disadvantaged people. Hence, this can be achieved by adopting Islamic microcredit