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Wednesday, 31 August 2022

Egypt’s first Islamic microfinance license goes to Maksab

Little known company aims to push into Islamic microfinance in Egypt: The Egyptian Microfinance Company (Maksab) has become the first local player to get a license from the Financial Regulatory Authority (FRA) to provide sharia-compliant microfinance. The move comes as part of the regulator’s drive to increase financial inclusion by widening microfinance options to unbanked microbusinesses, the regulator’s new chief, Mohamed Farid, said in a statement (pdf) yesterday.

Maksab who? We weren’t able to find a digital footprint for the company, though it looks to be relatively newly formed and headed by Mohammed Hassan (LinkedIn), former head of Islamic banking at Bank Audi Egypt (now FABMisr after its merger with First Abu Dhabi Bank). We reached out to Hassan yesterday but haven’t heard back from him or his media team as of dispatch time.

More Islamic microfinancing options could be coming soon: Maksab’s license is for a type of Islamic financing known as “al wakala bil istithmar.” The regulator is also looking into issuing licenses for sharia-compliant murabaha and musharaka financing for non-banking microfinance institutions, it said.

Nineteen companies now have licenses to offer microfinance services, the FRA said. Some 3.8 mn people received EGP 33.3 bn in microfinancing during the first seven months of 2022, 60% of them women, according to its figures.

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