Interest-free loans offered to struggling Muslims
- HERALD SUN
- JUNE 27, 2011
A STATE Islamic organisation is offering interest-free loans to low-income Muslims who otherwise can’t borrow money because of religious reasons.
Charging or paying interest for loans is banned under Islam, but many Muslims are taking advantage of a growing Islamic finance industry.
Dandenong postgraduate student Ali Alyassiry, who has two children, borrowed $1000 under a new scheme offered by the Islamic Council of Victoria.
“I needed the money to buy couches for my home,” he said.
The council provides the no-interest or so-called benevolent loans through a service developed by the Good Shepherd Youth and Family Service.
Project officer Asma Siddiq said there was a growing need for the loans in the Islamic community.
“There are many international students, refugees and unemployed people due to their education not being recognised here,” she said.
Ms Siddiq said the loans were for people who struggled to afford things like household appliances, car repairs and education costs.
La Trobe University, which runs an Islamic banking and finance course, trains volunteers for the no-interest loan scheme.
Gee wouldn’t we all like this oprion
Kiwi Muslims want to escape rent cycle
An Auckland woman is rallying banks around the country to provide interest-free mortgages to Muslims looking to buy their first home.
Sara Jawadi said because interest was forbidden in Islam, thousands of Kiwi Muslims were having to choose between their religion and economic stability.
The 28-year-old moved to New Zealand 11 years ago, and now lives in Manukau with her husband and two young children.
“I’m not going back to Iraq anytime soon, and I want to create some sort of stability for my family,” Ms Jawadi said.
Like many migrants she said her family had struggled to escape the rental cycle.
“With rent, you’re not guaranteed that you can stay in that place for too long … we’re sort of trying our best to find an alternative.”