Many developing countries attempted to alleviate poverty via micro finance policies. The main sources of finance are commercial banks the operate on Islamic principles and they are not allowed to charge interest in the conventional manner. The question is how to encourage these banks to provide the needed finance and at the same time reduce credit risk given the fact that the target group of micro finance are individuals who lack the appropriate collaterals
You can go through the paper
Islamic Microfinance:
An Emerging Market Niche
A book is also there
Islamic Microfinance: Instruments and Markets
Hi Abdelgadir,
The following attached file will help answering your question.
Hope this helps
Also see
https://books.google.co.uk/books?id=DqaoDAAAQBAJ&pg=PA193&lpg=PA193&dq=Islamic+insurance++credit+risk&source=bl&ots=N2kPh8eYME&sig=2_kWc6nPhN9hhJkWjSsFf2HGPRg&hl=en&sa=X&ved=0ahUKEwiSn8mQ39_OAhVBcRQKHRm2B9EQ6AEIPzAG#v=onepage&q=Islamic%20insurance%20%20credit%20risk&f=false
Dear Abdollah
there has been always a paradox between Islamic economic and insurance and financial risks.many papers published but still has not been solved.
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