Poverty Alleviation through Interest-Free Microfinance
By C. Naseer Ahmad
Washington, DC


Punjab Governor Khalid Maqbool and others

The non-profit organization Akhuwat, led by Dr. Amjad Saqib of Lahore, is using creative ways for poverty alleviation through Interest Free Microfinance in Lahore as well as some other cities of Pakistan. With its philanthropic efforts, Akhuwat is providing a helping hand rather than a hand-out. Akhuwat propagates, through its literature and field work, that the needy need not remain forever “needy.”
The organization is the brain-child of Dr. Amjad Saqib, a graduate of King Edward Medical College Lahore and a distinguished public servant. Company documents show a high loan recovery rate. Many borrowers, who are street vendors and small shop keepers, have come back to Akhuwat for additional financing to meet business needs.
Dr. Saqib claims that the key to his organization’s success is the low cost structure. Akhuwat avoids high office rents by operating out of mosques. Although, mixing business and religion can be troublesome, Dr. Saqib feels positive about Akhuwat’s operating procedures.
Dr. Saqib’s low-key style belies his vast experience as a public servant, as a Hubert H. Humphrey fellow with a graduate degree in public administration and as a consultant to World Bank and other international lending institutions. He has found easy access to senior public officials, including the Governor of Punjab and President Musharraf for his cause. Despite his connections, Dr. Saqib seems to lead a simple life. An old Honda Civic, without an air-conditioner, carries him around town for meetings at the Governor House or wherever Akhuwat takes him.
Akhuwat’s financial resources come from philanthropic donations from individuals, industrialists as well as institutions. Among its supporters is Punjab’s Governor Lt Gen (Retd) Khalid Maqbool, who recently listened to the personal testimony from some of the beneficiaries of Akhuwat’s interest free micro loans. During a meeting at the “Durbar Hall”, Governor House on September 28, 2006, pledges were collected from Akhuwat’s industrialist supporters.
Some of the loan amounts are as little as Rs 5,000. To the borrowers, such amounts can make a big difference creating a fighting chance to face grinding poverty. To those more fortunate in Pakistan, this amount could be merely the cost of air-conditioning a room. To those living in the West, this could be just the cost of lunch for two at a fine restaurant.
In addition to other applicants for micro-loans, Akhuwat provides financial assistance to selected candidates from the “Fountain House”, an established philanthropic mental health institution started by the renowned (late) Dr. Rashid Chaudhry. It is a commendable effort to provide mental health patients a chance to fight social stigmas.


Editor: Akhtar M. Faruqui
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