halal investment

8/6/2019 Halal Investment

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HALAL KAROBAR

HALAL INVESTMENT OPPORTUNITY

THROUGH ISLAMIC MICROFINANCE

Farz Foundation

Farz Foundation is The First Shariah Microfinance Institute of

Pakistan registered under section 42 non profit company

ordinance 1984 with Security & Exchange Commission of

Pakistan. Lahore Is the headquarter of Farz Foundation,

while it is working with three braches in Lahore and Jhang.

Jhang is the most neglected area of Punjab by the NGOs

particularly the deep rural areas of Jhang are still untapped.

Farz Foundation started its in Jhang during flood relief activ-

ity period and provided more than Rs.15 Million worth sup-

port in kind to the flood affected people of Tehsil AttharaHazari District Jhang. Farz Foundation also distribute 240

embroidery kits to the female poor artisans of the area.

A PKRS. 60,000 PAKAGE OF 7 GOATS

WITH TAKAFUL ( Islamic Insurance for theft

and death ) For a Period 5 to 39 Months can

change the lives of the poor along with a

handsome Halal profit for the investor

Salman Khalid :

+923214550275

[email protected]

[email protected]

Www.farzfoundation.org

A LIVESTOCOK PROJECT KICKED-OFF

BY PARTNERING WITH RURAL POOR

Zafar Nagar , Adah Shahbeera Abad, Chinyot

Road District Jhang, Punjab, Pakistan

Highlights of the project

Investor comes with at least one package for 5 months to

39 months (recommended ) on profit and loss sharing

basis

Farz Foundation provides a package of goats to the poor

family on 50% out put profit basis at the end of the one

business cycle.

The Farz Foundation and the investor get 25% each from

the remaining 50%

Farz Foundation runs its operations and other social work

for the poor from the same 25%

After the period of 39 months the profit rises as 600%

200% and 200% according to assumed calculation

Farz Foundation assures the security of the investment,

proper monitoring, Takaful for the death and the theft of

the animal, transparent sale & purchase of the animals

and other business modalities through a proper legal

agreement

Vendor &Mrketing Partner

Al-Muqit



LIVESTOCK THROUGH ISLAMIC MICROFINANCE IN

PAKISTAN

A BIG OPPORTUNITY

According to the observation, mostly, at Islamic Microfinance Sector level,

it is being practiced with the conventional structures. If there is any will to

do can feel for Islamic Microfinance, the lack of proper systems and

unavailability of skilled staff are the hurdles. In Pakistan a few Islamic

banks are studying Islamic Microfinance models to chalk out a proper one.

However none of them found the key solution yet. SBP’s Institutional

development fund is an attraction for the institutions, but the people sitting

in the committee are preferring only the institutions already have a visiblescale. According to the vision of the committee members the institutional

development fund is not for the organizations which are not already

developed with a handsome portfolio, while the Islamic Microfinance means

no commercial funding, no capacity building no MIS and no product

development support. In Pakistan a few development organizations like

Islamic Relief, and Muslim Aid are doing Islamic Microfinance by

maintaining their other projects. A charity Based Microfinance Institution

has a tremendous Qarz e Hasna, portfolio, but being a non commercial

organization for donors the experts are not ready to accept it as a

sustainable model, while the past proves it more sustainable than manyother Microfinance institutes, which demonstrated worst in spite of having

all the popular microfinance controls and risk mitigating systems and

procedures.

The success of any business depends upon the proper Products

fundamentally, while the conventional microfinance products showed only

3% impact according to the CGAP study. It is obvious that the products sold

through microfinance were not appropriate to alleviate poverty. The reason I

found behind the failure was an incapable human resource and the lack of

true visionary leadership.

According to the current poverty alleviation scenario, we would have to

appreciate CGAPs efforts for identifying Islamic Microfinance for not only

the Muslim poor but to gain noticeable positive impact at a larger market.

During a survey for spotting a Farz SME Village in District Jhang, which is

an untapped area of Punjab province, and one cannot finds any

perceptible engagement from NGOs, because of (perhaps) being a

sectarian violence affected area. However, Farz Foundation has started its

operations in two rural areas of the District Jhang. During research work,

Farz Foundation found the area very potent to launch their traditionalproducts of livestock after a pretty customization and aligning the products

Al– Muqit is the vendor for sale and purchase of the ani-

mals with money back guaranty or change of the animal in

case of any illness or damage.



products of livestock after a pretty customization and aligning the products

with a formal Islamic Microfinance mechanism (Farz Methodology). At the

second stage of the study, the survey and the focus group discussions

revealed that the products of goats and sheep are more feasible than

buffalos and cows at the first phase.

Study also shows that only the customization of the system is required with

a capable human resource having strong interpersonal relationship ability

with the traditional and cultural familiarity to build a strong social and

business relationship with the client. And a huge untapped ripe market is

awaiting because the 65% economy of Pakistan is based on agriculture

and out of it almost 52% economy is based on livestock.

According to a Gilani Research Foundation survey carried out by Gallup

Pakistan, meat is the most essential food item in people’s daily diet. In a

survey in October 2008, respondents were also asked to list what they

would like as the main component of their daily diet. Assuming that

financial constraints were removed and price was kept constant the results

revealed: 52% would prefer meat.

while the products are needed and marketable at the international level

undoubtedly. The markets of UAE and Europe can be quoted as the

potential meat markets for Pakistan.

Community is expert in nurturing and nourishing the livestock from

centuries to maintain their living. They know every sophisticated detail

about the animal and also very found of having them as their assets.

Livestock has been considered here as a social status also and one can

measure the economic level of a family or a person by assessing the

volume of the livestock he or she has. There is a very common practice

among the rural poor community to get the livestock from a well-off land

lord on 33% partnership or some time at 50% for a breed period or a period

of maturity of the animals for meat purpose. The livestock for meat

purposes has an extraordinary prospective on Eid e Qurban along with the

daily consumption of the meat in the country. According to economic survey

of Pakistan 2005 and 2005, 1.9000 metric tan meat being consumed only

in Pakistan. Mostly rural poor feed the live stock by getting them to the

jungles and green fields. Where the animals get the grass and various other

stuff to eat. They give animals also the special food called Wanda.

The poor stock the animals for their hard days and also to fulfill their

immediate needs like accidents, weddings or in case of a death in their

family. They usually sell the animal and accomplish the necessity.

Studies predict the livestock is not only an ongoing consumable item and a

very successful business but a social welfare work and a noble cause also

as a poverty alleviating tool. According to the financial analysis of the

business by Farz Foundation, it gives 500% profit to the investor during a

project of three to five years period and is 1000% profitable for the poor.

The economy of a country could be run and poverty could be eliminated

only by the livestock business if done properly. Any how the microfinance or

even banking with conventional structures believing in monthly orfortnightly recoveries with interest or profit may not be able to do this kind



fortnightly recoveries with interest or profit may not be able to do this kind

of business. Primarily Farz Foundation aims to disseminate the information

and to invite the social investors to step in, particularly the people wants to

do the Halal investments. If Islamic microfinance organizations engage

themselves only in livestock business, they can show the tremendous

results. Secondly Farz Foundation offers partnership opportunity at all

investors, donors and philanthropists level to come and join hands with

Farz Foundation in this regard.

Profile:

FARZ FOUNDATION is a multi faceted social organization

with microfinance and social uplift as its focal enclave and core

business. The Foundation’s multi dimensional approach to

poverty alleviation is grounded in out of box and creative

solutions with embedded ground realities compatibility. It is thefirst Islamic microfinance organization of Pakistan (Shairah

certified). The Foundation is an Islamic Microfinance asset-based

provider, which has recently registered itself under section 42 of

the Companies Ordinance 1984 Security and Exchange

Commission of Pakistan.

FARZ FOUNDATION - THE ORGANIZATION

VISION: To bring social change through poverty alleviation by

improving productivity and capacity of clients and staff

MISSION: Empowering the poor through innovative products and

diverse business opportunities, by integrating social

performance focused microfinance with collaborative community

health and education partnerships.

ORGANIZATIONAL OBJECTIVES

To become an economically viable and financially sustainable

model organization through social and economic

performance based microfinance institution, which

conforms to Shariah modes of finance and investment.

Adopted a dynamic organizational structural design with

embedded knowledge organization concept, which enableand support the organizational objective of creating:



an suppor e organ za ona o ec ve o crea ng:

A stimulating and professional work environment to the

staff and their continual capacity building;

operational research based development of financial

products and services that are geared towards

bringing positive uplift in target communities;

dynamic organizational platform suited for creating

linkages with other local and international

microfinance institutions/microfinance banks/donor

organizations and pertinent organizations &

agencies in the arena.

To bring improvement in:

economic and social status of poor households’

through adoption of Islamic modes of finance;

human resources development effort, which could

provide fillip to the entrepreneurial capacity building

and green technology driven development inPakistan;

social mobilization campaigns for:

elimination of gender discrimination in rural and

urban areas;

heightened awareness on environmental issues

and environmental conversation.

Green technology encompassing solutions and

there adoption at the grass root level;

basic preventative health education.



.

ORGANIZATIONAL STRUCTURAL DESIGN

BOARD

At the apex of the Foundation’s structure is the Board of

Directors, which consists of professionals having a strong

background of microfinance and development sector. The

Board functions are in conformity with specified Board of

Directors functions by Security and Exchange Commission of

Pakistan.

The Board provides guidance to Foundation’s management

on institutional strategic directions and oversees

management’s efforts in achieving given overarching strategic

objectives.

The chairperson of the Board is also the Foundation’s Chief

Executive and interplays between Board and management

centers. This relationship between strategy and operational

platforms is proving successful in the evolutionary process of

the organization.

The Board oversees linkages with:

Local and international donors agencies, multilateral

organizations, government, institutional and individual

investors;

financial institutions; regulatory bodies and other

stakeholders, including clients, employees, and

shareholders;

In its governance role, the board is accountable to all the

stakeholders and continually assesses the impact andobjectivity of the linkages.

ADVISORY BOARD

The Foundation has an Advisory Board structure, which is

headed by its own Chairman and has members that represent

wide spectrum of society.

The Advisory Board in its capacity advises the Foundation on

its strategic planning and management perspectives, and

m d s f int rv nti n in s ci c n mic s ct rs f th



,modes of intervention in socioeconomic sectors of the

country; with the expressed focus of achieving the

organizational objectives in a phased and planned manner. It

also advises the Foundation on intervention strategies in

halal investment

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