With the harsh economic realities hitting hard on the populace, any effort aimed at easing the pain at this time is well commended. This is more so that governments have also identified that individuals and businesses must help Nigerians navigate the storm. It is in that line that the Islamic Cooperative Society and Microfinance Bank has emerged as a beacon of hope for Muslims and marginalised communities. Like many other Islamic organisations that have played a pivotal role in alleviating people’s suffering by providing financial assistance as well as zero-interest rate, in adherence to Islamic principles, AZEEZ OLORUNLOMERU explores the profound impact of such organisations, examining how they empower individuals, foster community development, and contribute to socioeconomic stability in Nigeria.

Islamic financial organisations operate on the principles of Shariah, prohibiting interest, promoting risk-sharing, ethical investments, and social welfare.

Undoubtedly, this helps to promote financial inclusion, particularly for the underprivileged, aside access to interest-free loans and other alternative financial services.

All these are done in alignment with Islamic teachings, which emphasise justice, equity, and compassion in economic dealings. And in Nigeria, several Islamic organisations have spearheaded efforts to implement Islamic banking as a means of addressing poverty and alleviating suffering. One of such organizations is Al-Hayat Relief Foundation. It was gathered that the foundation started out on the principle that a country with double digits interest rate will go nowhere near its potential economically and wellbeing of its people. And over the years, this philosophy has made the foundation stands out in its commitment to serving the less privileged.

Of note is that Al-Hayat Relief Foundation which established the Islamic Cooperative Society and Microfinance Bank about 27 years ago did it as a mere protest and alternative to other means of rendering financial service which is not Islamic.

Today from a humble beginning with six ideological Muslims, the Islamic microfinance bank has over 20,000 members scattered across southwest states and communities, including Kwara State.

And Al-Hayat Relief Foundation is still growing in catering to the wellbeing of ordinary citizens as well as contributing its quota to the Gross Domestic Product (GDP) of the country with more than five other projects in its folds – Hospital, Microfinance Bank, Real Estate, Cooperatives society.
 
The outlet through its numerous poverty alleviation programmes and its microfinance bank has empowered individuals, especially Muslims and non-Muslim groups in the country through providing interest-free loans for entrepreneurial ventures.

Speaking on the foundation’s activities, its President, Dr. Asif Olatubosun Azeez believed government at all levels, particularly the Federal Government, needs to support farmers with interest-free loans to encourage large numbers of youths to go into farming.

Azeez, a senior lecturer at Sikiru Adetona College of Education, Science and Technology, Omu- Ijebu, stated that for the nation to overcome the current economic challenges and halt the rapid fall of the naira, government should as a matter of urgency, encourage farmers by way of granting free interest loans.

He explained that the organisation is working towards creating an endowment with the proceeds given to the less-privileged in the society. He stated that the government should collaborate with Islamic organisations like Al-Hayat Relief Foundation to route many of its intervention programmes aimed at cushioning the effects of the current economic downturn if it hopes to get the needed results.

He attributed the free fall of the Naira to the collapse of Small and Medium Enterprises structure in the country, adding that SMEs need the financial assistance and more enabling environment to succeed.

The president of the foundation pointed out that part of the challenges faced by his organisation is how to penetrate the northern region of the country to help reduce the poverty rate through zero-interest loans that will have a significant impact on the nation’s Gross Domestic Products (GDP).

“Business is the life wire of Al-Hayat. The foundation engages in halal businesses since it does not take interests. The business activities of all the branches conform with the principles laid down in fiqh Muʿamalah,” he said.

The expert in Islamic banking and finance also noted that for Islamic banking to contribute its quota meaningfully to the nation’s economy, the department for Islamic banking at the Central Bank of Nigeria (CBN) should be allowed to grow and protect the bank from liquidating by using Islamic micro insurance to protect it.

He noted that the foundation is an interest-free cooperative society formed 27 years ago to rescue Muslim brothers who were often forced to take loans from money lenders which charge exorbitant interests.

“More so, we observed that the practice was that, after securing the loans, the lenders would not want the loans to be paid back. Rather, they would prefer the interest to accumulate,” he said. He also urged the government to fully support the SMEs so as to boost the nation’s GDP and limit reliance on foreign goods.

Although the organisation started as a traditional cooperative society and still operates same, its solid foundation and tenacity gave it an edge above others by giving birth to other developmental projects.

Also speaking, the General Manager of the Foundation, Alhaji Waidi Raimi, said the foundation, which is founded to cater to the interest of Muslim brothers and sisters have branches in all the Southwest states including Kwara.

He said efforts are on to penetrate the northern part of Nigeria so that poverty will be eradicated within the Muslim fold. He noted that as a result of people’s request for more branches, Al -Hayat has grown into a household name in Sharīah principled and microfinance activities. He pointed out that the organisation adopted the zero-interest rate for its members based on Islamic injunction.

According to Raimi, despite its transformative potential, Islamic microfinance banks in Nigeria face various challenges, including regulatory constraints, limited awareness, and insufficient funding.

“These challenges also present opportunities for collaboration between governmental bodies, non-governmental organisations, and the private sector, to create an enabling environment for Islamic microfinance to thrive.

To maximize the impact of Islamic microfinance on alleviating suffering in Nigeria, he said that policymakers must enact supportive regulations that recognise and accommodate the unique features of Islamic finance.

“This includes facilitating the establishment of Islamic microfinance institutions, providing tax incentives, and integrating Islamic finance into mainstream financial systems.”

On his part, the Chairman, Board of Trustees, Al- Hayat Relief Foundation, Professor Salako Taofiki Ajani, noted that Islamic microfinance banking has emerged as a potent tool for alleviating suffering and promoting inclusive economic growth in Nigeria.

“Through interest-free loans, ethical investments, and community-driven initiatives, Islamic cooperative societies have empowered individuals, fostered social cohesion, and advanced the principles of justice and compassion in economic affairs,” he said. He explained that moving forward, sustained efforts and collaboration across sectors are essential to unlock the full potential of Islamic microfinance banking and create a more equitable and prosperous society for all Nigerians.