Year
2020
Country
Qatar
Language
English
Abstract
| In this research, we discuss pertinent macro-perspectives and adopt a financial engineering approach to design financial products by blending the motives of compassion, profits and facilitation, that underlie respectively, the philanthropic, commercial and public sector activities. Financial contracts could be incentive compatible and effective if these three motivations are recognized and brought together. The purpose of our research is to offer such incentive-compatible structures that can mobilize funding for socially responsible and impactful SMEs, save cost as well as generate revenue for self-sustainability. Since the blended nature of the contract provides a social subsidy to fund the cost element of the financing, the proposed structure creates a win-win result for the blending parties. While financial institutions expand into the SME sector for profitability, blended Islamic finance is expected to attract additional resources towards enhancing development impact. Through the philanthropic component, SMEs, on the other hand, will access the source of social subsidy that will relieve the burden of the exorbitant commercial rates. The funding structure is also expected to reduce risk perception and spur growth. Consequently, this will contribute to achieving multidimensional human development, as enshrined in the Maqasid al-Shariah, and Sustainable Development Goals (SDGs). Impactful business must integrate environmental, social and governance best practices as well as national development goals. Hence the proposal offers a number of benefits. |
English
City
College of Islamic Studies, Hamad Bin Khalifa University, Doha
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CIS Program Old
CIS publications
No
CIS Thesis
No