Introduction

Asasahnama is here once again after a lapse of two years. Asasah is known to many people, friends, community, staff, donors and investors as a specialized Microfinance Institution for the last 11 years. Till 2013, we successfully disbursed 170,000 micro loans, 170,000 life insurance policies, 35,000 Sehat Sahulat (health Insurance) facilities and financial literacy training to 2800 women spreading in 16 cities. Since its inception in 2003 till June 2013, Asasah has helped disbursed loans through conventional microfinancing to poor families, specifically women, for the purpose of their economic uplift and sustainability which also included provision of education subsidies and scholarships for their children. Asasah is the only MFI that started its operations in the year 2003 with commercial funding.

Time period between July to December 2013 was of great importance to Asasah and in July 10, 2013 Asasah announced to transform from Conventional microfinance to 100% Islamic Microfinance. This change is not incidental but it took four years to study, ponder, understand and then implement this thought in our modus operandi and infrastructure. 

Here we would specially like to give credit of this change in thought, to Mr. Suleman Ahmar of Timelenders, who gave us this vision. Asasah staff had the privilege of attending various trainings conducted by Timelenders, whereby the fact that we as human beings have the responsibility of understanding the Quran and Sunnah and acting accordingly, was very well highlighted. Our focus is on the fact that we should act in a way that would please Allah. Although the Conventional model of Asasah had some similarities to the Islamic mode but still some basic ingredients were missing.

In December 2009, Asasah signed a MoU with Al-Huda (CIBE) and converted its Conventional Kasur branch to Islamic Microfinance on pilot basis, whereby women and men of the area were offered “Asset based Financing” - “Murabaha”

Following were the outcomes of this pilot project:

• Clients liked the Murabaha product, whereby they were receiving assets on easy loans and as per their business needs.
• Introduction of more products for the client, which resulted in business expansion and growth.
• We feel that staff required more training and more understanding of the Murabaha product and the system.

After the completion of the pilot project, I as the CEO of Asasah, undertook trainings and sessions for two years in order to have a thorough understanding of the system. I also reached out to Islamic Microfinance Network and became their member and also observed the national as well as international organizations involved in the related tasks and operations.

I would specially like to thank Mr. Amjad Saqib CEO Akhuwat who has sat with me on various occasions and helped me understand Akhuwat's Qarz-e-Hasna methodology. He convinced that this model does not required huge funds but only determination and all would turn out well with the grace of God who will Himself pave way for success. Asasah replicated the model of Akhuwat in September 2013 and also joined Dr Amjad Saqib's network of “Qarz-e-Hasna”.

In the year 2009, Asasah in collaboration with PLAN PAKISTAN started the PPI – “Progress Out of Poverty Index” with the purpose of measuring the poverty of the clients on the given scale and then offering them services and products that would meet their requirements. Asasah started the provision of 100% Islamic Microfinance with the following objectives in mind: 

•  Provision of complete financial package to the poor families which would increase their income and is also facilitating them in meeting other household expenses, such as grocery, education, health.
• Small business loans to women and men as per their business' need.
• 100% asset based financing.
• Introduce innovative products, at large scale, in order to meet their household expenses.
• Facilitation of families scoring more than 40% on the PPI scale.

Since July 2012, Asasah has been facing a lot of financial problems, main reason being that the geographical spread increased which resulted in shooting expenses against limited income. As a result some of the major donors withdrew and Asasah faced a huge debt of 240 million rupees. 

Keeping in view the need of the hour, Board members and the management of Aasah joined hands and chalked out strategies to strengthen Asasah again. Special credit goes to Mr. Anwar Rashid, CEO OCT, who played an important role in all this. Rumors were that the organization is at the verge of closing down but by the grace of God, after a struggle of 4 years, the organization has emerged once again with a renewed hope and determination. I would like to congratulate the management without whose support and cooperation all this would not have been possible.

In the coming 12 months, in line with our tradition, Asasah shall set a new precedent by launching innovative Islamic products and services for vulnerable households, InshaAllah.