Guided by the twin pillars of digital and value-based intermediation (VBI), Malaysia’s Hong Leong Islamic Bank (HLISB) has partnered with fintech start-ups to roll out a new social finance program.
Targeting individuals without full-time employment and aspiring micro-entrepreneurs who lack a credit history, the new program, known as HLB Jumpstart – Micro Business, will provide zero-profit financing and capital opportunities to start a business as well as business management mentorship and training. The program aligns with Bank Negara Malaysia’s Financial Sector Blueprint 2022-26 to elevate social finance as an integral part of the Islamic finance ecosystem.
HLISB has engaged Islamic crowdfunding platform MADCash and alternative data intelligence firm AlfieTech for this program, which offers two types of seed funding.
Successful participants will be eligible to RM4,000 (US$843.61) in funding, payable over 12 months at a zero-profit rate, to be channeled via MADCash. Concurrently, the Islamic fintech company will also assign a mentor to provide guidance on building a successful and sustainable business. AlfieTech will disburse up to RM1,500 (US$316.36) per applicant to utilize as e-commerce credit to run the business by placing orders on their proprietary platform.
“We are encouraged by the positive impact seen across the businesses of some of AlfieTech and MADcash’s participants. This is a testament that social finance is an effective avenue for narrowing financing gaps in the country by empowering the underserved communities via increasing access to financial services and improving financial literacy,” commented Jasani Abdullah, CEO of HLISB.
Founded in 2019 with the vision of touching one million lives through financial and business education and micro funding by the year 2024, MADCash is a donation-based crowdfunding platform supporting Malaysian women micro-entrepreneurs with Shariah compliant microfinancing. The idea is to convert one-time donations into a ‘perpetual’ donation with the concept of paying-it-forward.