Micro Waqf Bank for Empowerment of Indonesian Women's Microeconomic and Efforts Minimizing the Loansher Trap

Abstract

Fulfilling household needs for a woman is required to be able to obtain and manage halal-sourced finances from a small and micro-entrepreneur. The trap of conventional and online loan sharks poses a significant risk to the borrower's assets due to the lack of business capital they have in the short term. Establishing a micro waqf bank initiated by the financial services authority in Indonesia aims to provide business financing, assistance and financing sourced from zakat, infaq, sadaqah and waqf relying on Islamic social microfinance institutions. This study aims to analyse micro waqf bank woman customers with small and micro-entrepreneurs to avoid entrapment by a loan shark. The study at the El-Manahij Micro Waqf Bank, Lebak Regency, Banten Province, Indonesia, used qualitative descriptive types through data collection interviews with managers and the head in weekly halaqah. In contrast, data analysis used triangulation: data reduction, display, verification and conclusion. Research shows that most micro waqf bank customers are women with micro-scale enterprises to improve Islamic economy studies. Customers choose micro waqf banks to replace loan sharks providing their business capital and having regular activities in the form of weekly group meetings aimed at knowing business progress, religious studies and gradual loan repayments. Micro waqf bank managers receive pawned valuables with sharia contracts to increase business capital. The customers are responsible for repaying business loans in stages, running social gatherings for customers to obtain excess money and supervising fellow customers. The research implies that getting away from the snares of loan sharks can minimise the burden of living costs where they live. The significant role of micro waqf banks in providing Sharia pawn support is to increase business capital to limit dealing with loan sharks.

The Role of Productive Women in Alleviating Poverty Through Strengthening Islamic Social Finance: A Study of Micro Waqf Banks in Indonesia

“…Studies show that customers choose micro waqf banks (MWB) as an alternative to loan sharks, which offer business funding and conduct regular activities through weekly group meetings focused on monitoring business development, religious education, and progressive loan reimbursement (Fauzi, Haji Othman, et al, 2023). In addition, customers of micro waqf banks who are women have the responsibility to repay business loans in stages, organize social events to raise additional funds and supervise other customers (Fauzi, Priatno, et al, 2023).…”