Empowering Entrepreneurship and Transforming Communities
For Abdul Tayeb Saifee, a 58-year-old Bengaluru-based industrial adhesive manufacturer, surviving and supporting his family was the only priority after a major economic setback. During this trying time, when he could not get sufficient financial help from friends and family, the Qardan Hasana institution stepped in to help him sustain and rebuild his life.
Qardan Hasana, literally translated as ‘the good loan’, is a Dawoodi Bohra community initiative that offers interest-free loans in keeping with the Islamic injunction to refrain from all forms of interest. Established 45 years ago, this institution aims to assist community members in improving their housing and quality of life, supporting education, and enabling business growth. Over the decades, hundreds of Qardan Hasana branches have been set up throughout South Asia, where the majority of the Dawoodi Bohra community resides, and across the rest of the world.
“The timely loan was like an elixir, a single drop of water that revived me and gave me a new lease on life,” says Saifee. He adds that choosing to repay the loan instalments on time has instilled a sense of responsibility in him and motivated him to push beyond his comfort zone to work harder. Saifee expresses gratitude to the late 52nd leader of the Dawoodi Bohra community, Syedna Mohammed Burhanuddin, on his 11th death anniversary, for having established the Qardan Hasana institution in 1979.
The Working Mechanism
The primary contribution to any Qardan corpus is provided by the Syedna (the spiritual and administrative head) of the time, currently Syedna Mufaddal Saifuddin, along with secondary contributions from local community members. The Syedna continues to infuse new funds, especially on important anniversaries or celebrations. His efforts to promote and implement the concept of Qardan Hasana inspire his followers to emulate him.
There are no limitations to contribution; members can give as little or as much as they like according to their capacity. As a result, these organizations are well equipped to cater to the socio-economic needs of any community member.
Overcoming the Burden of Interest
Every other day, we read stories about interest-bearing loans that have resulted in unpayable debts and bankruptcy, or people feeling buried under the weight of interest on housing or education loans. The economic effects of the pandemic and the period of extreme global banking systems have exacerbated the lives and livelihoods of millions across the globe.
However, studies have shown how important cash reserves are in times of uncertainty, as well as for fostering future growth. The Qardan Hasana model provides a viable alternative, offering interest-free loans that empower individuals and businesses without the burden of compounding interest.
Fuelling Entrepreneurship and Growth
Ahmed Calcuttawala, a 94-year-old entrepreneur from Kolkata, owns a marine supplies business. Due to the capital-intensive nature of his business, he requires a regular infusion of cash, which he avails from the Kolkata Qardan Hasana office. “This,” he says, “proved highly beneficial for my working capital, especially during and post-pandemic business recovery.”
Calcuttawala recalled a recent incident when he was bidding for an order from the Ministry of Defence, which required heavy investment. While the bank offered loan options, he chose to raise money from Qardan Hasana to fulfill the order.
Ranging from large-scale amounts for industrial and commercial growth to small-scale amounts to venture into businesses, Qardan Hasana has provided aspiring entrepreneurs with the financial wings they need to soar. “With the support of the money I received, I was able to turn my dream into reality,” shares 32-year-old Zahra Aliasgar, a teacher from Coimbatore who transitioned from working in a private school to starting her own kindergarten. “The institution’s assistance gave me the confidence and resources to pursue my ambitions without the burden of interest.”
Empowering Women and Fostering Inclusive Growth
The Qardan Hasana model has been particularly transformative for women, who often face greater barriers to accessing traditional financial services. By providing interest-free loans, the institution empowers women entrepreneurs to pursue their dreams and contribute to the economic development of their communities.
Zahra Aliasgar’s story is a testament to this. With the support of Qardan Hasana, she was able to transition from a teaching role to starting her own kindergarten, realizing her entrepreneurial aspirations. This not only benefits Zahra personally but also creates employment opportunities and expands access to quality early childhood education in her local community.
Similarly, the institution has enabled women to improve their living conditions, invest in their children’s education, and gain financial independence. This cascading impact on families and communities is a hallmark of the Qardan Hasana model, which focuses on uplifting lives holistically.
Fostering a Culture of Responsibility and Community Upliftment
The Qardan Hasana model is not just about providing financial assistance; it also instills a sense of responsibility and community spirit among its recipients. By choosing to repay the interest-free loans on time, borrowers like Abdul Tayeb Saifee have demonstrated their commitment to the institution and their desire to contribute positively to their community.
This culture of responsibility and giving back is further reinforced by the Syedna’s own efforts to promote and expand the Qardan Hasana initiative. The Syedna’s regular infusion of funds and his inspiration of the community to participate in the program have been instrumental in its growth and success over the past four and a half decades.
Conclusion
The Qardan Hasana institution of the Dawoodi Bohra community stands as a shining example of how interest-free, community-driven financial solutions can transform lives and fuel entrepreneurship. By providing a viable alternative to traditional, interest-bearing loans, Qardan Hasana has empowered individuals, supported businesses, and uplifted entire communities across India.
As the world grapples with the economic challenges posed by the pandemic and global financial systems, the Qardan Hasana model offers a sustainable and ethical approach to financial inclusion and community development. Through its focus on responsibility, collaboration, and a deep commitment to improving the lives of its members, this 45-year-old institution continues to be a beacon of hope and a blueprint for grassroots development initiatives worldwide.
The Joint Action for Water blog is proud to highlight the remarkable work of the Qardan Hasana institution and its transformative impact on communities in India. By sharing these inspiring stories, we aim to inspire others to explore innovative, community-centric solutions that can address the pressing challenges in the water, sanitation, and development sectors.
