Islamic Micro and SME (MSME) Finance Questionnaire
Background
CGAP, in collaboration with Al Baraka Banking Group and Sanabel,is conducting a survey this
fall to assess the delivery and scale of Shariah-compliant financial services to Micro and Small
and Medium-Sized Enterprises (MSMEs).
This questionnaire is for institutions worldwide who offer Shariah-compliant financial services to
the Micro and/or SME sectors, whether operating as a fully Islamic institution or providing Islamic
finance through a window. Please be assured that individual institution data will remain
confidential and will be used to feed into our overall industry analysis.
Thank you for taking the time to fill out this questionnaire.
Instructions for submission




I.
All currency figures should be in US$, using current exchange rates on www.xe.com
Please provide all financial and outreach information for year-end 2010
Please type your answers directly on this form
Email completed questionnaire with financial statementsto nkarim@worldbank.org
Contact Information
1.
2.
3.
4.
II.
Name of employee
completing questionnaire
Position
Contact email
Contact phone number
Institution Background
1.
2.
3.
Institution Name
Year established
Institution type
4.
Institution offers
a.
b.
c.
d.
e.
f.
g.
h.
i.
Bank
Non Bank Financial Institution (NBFI)
Non Government Organization (NGO)
Village bank/rural bank
Cooperative
Leasing company
Takaful company
Mudaraba company
Other (Specify):
a. Islamic microfinance
1
b. Islamic SME finance
c. both a &b
5.
Year established
6.
How does your institution
define microfinance?
(ifapplicable)
a. Islamic microfinance:
b. Islamic SME finance:
Please specify parameters you use for the definition. For
example:
# of Employees: 10 or less
Revenue: $2 million or less
Total Assets:
# of Employees:
Revenue:
Banking Law:
Other (Specify):
7.
How does your institution
define SME?
(if applicable)
Please specify parameters you use for the definition. For
example:
# of Employees: 150 or less
Revenue: $10 million or less
Total Assets:
# of Employees:
Revenue:
Banking Law:
Other (Specify):
8.
Islamic microand/or SME
is
a. Sole business (skip to Q10)
b. One window of activity
9.
a. Yes
b. No
11.
Does your institution have
separate financial
statements for Islamic
finance activities?
# of dedicated Islamic
finance branches
Total # of branches
12.
Ownership structure
13.
Ownership shares of the 5
biggest shareholders:
10.
# in Urbanareas:
# in Peri-Urban:
a. Sole proprietorship
b. Partnership
c. Corporation
Name
% owned
1.
2.
3.
4.
5.
# in Rural:
III.
Islamic Products on Offer
1. List all Islamic micro/SME financing and deposit products offered by your
institution.
Eg
Product
Name
Product Structure
Pricing/
Rate of
Return
Purposes
of
financing
SME or
Micro?
Youth
Murabaha
Max Financing:$800, Min Financing: $50
Duration: 6 or 12 months
Repayment: monthly
Guarantee: group guarantee
Cost plus 15%
Informal:
trade,
service,
productio
n;
Micro
sector
Najm Savings
Min opening deposit: $5
Account opening fee: none
Limit on withdrawal: $500/day
Limit on deposit: none
Average
return
between 811%
N/A
Micro
Microtakaful
Provider Name: Asuransi A
Shariah-compliant: Yes
Private or Public: Private
Underlying model: Ijarah based
Yearly
contribution
$12
Property
insurance
Micro
i.
ii.
iii.
iv.
v.
Eg
i.
ii.
iii.
Eg.
i.
ii.
iii.
3
2. Briefly explain the following policies for your Islamic products:
i.
Late Payment Policy
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
ii.
Write-off Policy
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
3. Do your products follow AAOIFI standards?
a. Yes b. No
4. What steps are taken for Shariah approval of your products? Please circle all
that apply, and add additional comments as necessary.
a.
b.
c.
d.
e.
Internal Shariah board/advisor
External Shariah board/advisor
Local religious council or mosque committee
Hire an organization that provides Shariah certification services
Governmental Supervision
5. Steps taken forShariah certification of products:
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
IV.
Financial Information and Outreach
1. What sources are used for refinancing of institution?Check all that apply.
a.
b.
c.
d.
e.
f.
Liability products
Equity
Commercial loans
Qard Hassan (non-interest bearing loans)
Donations/Zakat
Other (specify):
2. What is the Average Cost of Capital? _______________
3. Please provide the following financial information for year-end 2010 for your
entire institution (conventional and Islamic business). Definitions of ratios are
referenced in the appendix.
i.
ii.
iii.
iv.
v.
Profitability
Return on Assets
Return on Equity
Efficiency
Operational self-sufficiency
Operational expense ratio
Portfolio Quality
PAR>30 days
4. Please provide information for year-end 2010 for your conventional
microfinance (non Shariah-compliant) portfolio only. (if applicable)
i.
ii.
iii.
iv.
v.
vi.
Outreach
Total # active borrowers
Total loans outstanding ($)
Total net income from
operating/conventional financing
activities ($)
Total net income from non-financial
activities ($)
Total # depositors
Total deposits ($)
Microfinance
SME Finance
5
5. Please provide information for year-end 2010for your Islamic micro and SME
portfolio only.
Outreach
Total # clients of financing products
Total financing outstanding ($)
Ratio of total Islamic financing to
overall financing
Total net income from
operating/Islamic financing
activities ($)
Total net income from non-financial
activities ($)
Total # depositors
Total deposits ($)
i.
ii.
iii.
iv.
v.
vi.
vii.
Islamic Microfinance
Islamic SME Finance
6. Please provide outreach and performance information for year-end2010 by
Islamic modebelow. Definitions of ratios are referenced in the appendix.
Note:


We are interested in outreach and performance by product type. If you offer two
or more different types of Murabaha products e.g. Youth Murabaha and Group
Murabaha, please combine information for all
Information on “financing” and “deposit”products is requested in separate tables
below
FINANCING MODE
Murabaha
# of active clients
% female clients
Total Murabaha financing outstanding ($)
Income from Murabaha financing ($)
Gross non-performing ($)
Total value of write-offs($)
Average operating expense($)
Volume of Murabaha as % of total Islamic
financing
Ijarah
# of active clients
% female clients
Total Ijarah financing outstanding ($)
Income from Ijarah financing ($)
Gross non-performing ($)
Total value of write-offs ($)
Average operating expense ($)
Microfinance
SME Finance
Microfinance
SME Finance
Volume of Ijarah as % of total Islamic
financing
Musharaka
# of active clients
% female clients
Total equity ($)
Average equity share (%)
Average annual rate of return for institution
Income from Musharaka financing ($)
Gross non-performing($)
Total value of write-offs($)
Average operating expense ($)
Volume of Musharaka as % of total Islamic
financing
Mudaraba
# of active clients
% female clients
Total equity ($)
Average equity share (%)
Averageannual rate of return for institution
Income from Mudaraba financing ($)
Gross non-performing ($)
Total value of write-offs($)
Average operating expense ($)
Volume of Mudaraba as % of total Islamic
financing
Salam
# of active clients
% female clients
Total Salam financingoutstanding ($)
Income from Salam financing ($)
Gross non-performing ($)
Total value of loans written off $
Average operating expense ($)
Volume of Salam as % of total Islamic
financing
Istisna
# of active clients
% female clients
Total Istisnafinancing outstanding($)
Income from Istisna financing ($)
Gross non-performing ($)
Total value of write-offs($)
Average operating expense ($)
Volume of Istisna as % of total Islamic
financing
QardHasan
Microfinance
SME Finance
Microfinance
SME Finance
Microfinance
SME Finance
Microfinance
SME Finance
Microfinance
SME Finance
7
# of active clients
% female clients
Total Qard Hassan loans outstanding ($)
Fee based income from QardHasan financing
($)
Gross non-performing ($)
Total value of write-offs($)
Average operating expense ($)
Volume of QardHasan as % of total Islamic
financing
Musawama
# of active clients
% female clients
Total Musawama financing outstanding ($)
Income from Musawama financing ($)
Gross non-performing ($)
Total value of write offs($)
Average operating expense ($)
Volume of Musawama as % of total Islamic
financing
Microfinance
SME Finance
Microfinance
SME Finance
Microfinance
SME Finance
Microfinance
SME Finance
SOURCE OF FUNDING/LIABILITY
Current Account/Wadia
# of active depositors
% female depositors
Total deposits ($)
Total deposits used for investment ($)
Fee based income ($)
Value of current account deposits as a % of
total liability products
Profit and Loss Sharing (PLS) Investment
Accounts
# of active clients
% female clients
Total deposits ($)
Total deposits used for investment ($)
Income from PLS deposits ($)
Value of PLS deposits as a % of total liability
products
Other Deposit Account- Specify
_________________________________________
# of active clients
% female clients
Total deposits ($)
Total deposits used for investment ($)
Income from deposits ($)
Value of deposits as a % of total liability
products
TAKAFUL (ISLAMIC INSURANCE)
Property
Microfinance Sector
Life
Other
_________
Property
SME Sector
Life
Other
_________
# of active
clients
% female
clients
Total gross
contributions
Net
surplus/deficit
Provision for
outstanding
claims
For products that combine more than one Islamic contract (e.g. Ijarah and
Musharaka) include information below. Repeat table if applicable.
Name and Structure of product:
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Product Information
# of active clients
% female clients
Total financing outstanding
($)
Income from product
financing ($)
Gross non-performing ($)
Total value of write-offs ($)
Average operating
expense ($)
Amount of product
financing as % of total
Islamic financing
Average annual rate of
return
Microfinance
SME Finance
9
7. Projections:
2012
2016
Projected increase in # of
branches
Projected increase intotal
Islamic financing
outstanding
Projected increase in total
Islamic deposits
Projected ratio of total
Islamic micro and SME
financing to overall
financing (if applicable)
Plans to offer additional
products
---Thank you for participating in our survey ---
Appendix
Ratios
Return on Assets
Return on Equity
Profit Margin Ratio
Operational Self-sufficiency
Operating Expense/Loan Portfolio
PAR>30 days
Amount of total net income/Amount of total
Assets
Amount of total net income/Total Equity
Net income/total operating revenue
Financial Revenue/Financial Expense +
Impairment Loss + Operating expense
Operating expense/Gross Loan Portfolio
Portfolio at risk>30 days / Gross Loan Portfolio
Definitions of Islamic Finance Products/Contractsi
Product/Contract
Ijarah
Istisna
Definition
Hire, rent or leasing. Sale of the usufruct of an asset. The lessor retains the ownership of the
asset, together with all the rights and the responsibilities that go with ownership.
An ijarah contract refers to an agreement made by the Institution offering Islamic Financial
Service to lease to a customer an asset specified by the customer for an agreed period
against specified installments of lease rental. An ijarah contract commences with a
promise to lease that is binding on the part of the potential lessee prior to entering the
ijarah contract
An Istisna contract refers to an agreement to sell to a customer a non-existent asset, which
is to be manufactured or built according to the buyer’s specifications and is to be
delivered on a specified future date at a predetermined selling price.
Refers to a contract whereby a manufacturer (or contractor) agrees to produce (or
construct) and deliver, at a given price on a given date in the future, a well described
good(or building) according to specifications. As against Salam, in Istisna the price need
not be paid in advance. It may be paid in installments, similar to progress payment as
agreed by the parties, or partly up front, with the balance being paid later.
Mudaraba
Murabahah
A contract of partnership between capital and work- that is, between two partiesnamely, one or more capital owners or financiers (called the Rabb al-mal) and an
entrepreneur or investment manager (called the Mudarib). Profit is distributed between
the two parties in accordance with a predetermined ratio, agreed at the time of the
contract. Financial loss is borne only by the financiers. The entrepreneur’s loss lies in not
getting an any reward for his or her services.
A murabaha contract refers to a sale contract whereby the Institutions offering Islamic
Financial Service sell to a customer, at an agreed profit margin plus cost (selling price), a
specified kind of asset that is already in their possession.
Sale at cost plus mark-up price. The term, however is now used to refer to a sale
agreement whereby the seller purchases the goods desired by the buyer and sells them at
an agreed marked-up price (murabahah to the Purchase Orderer). The payment is
settled within an agreed time frame, either in installments or in a lump sum. The seller
11
Musawama
Musharaka
Qard Al-Hassan
Salam
Takaful
i
bears the risks associated with the goods in possession until they are delivered to the
buyer.
Describes a sale contract between Islamic financial services provider and a customer that
is similar to murabaha, but in this case the seller is not obligated to disclose the price paid
to create or obtain the good or service. This type of contract occurs when it is difficult to
determine what the cost of a good or service was. The following conditions must apply:
the asset must be in existence and in the sellers possession at the time of the sale; the sale
must occur instantaneously, future sale dates are void; the asset must be of value and
usable.
A contract between the Institution offering Islamic financial service and a customer to
contribute capital to an enterprise, whether existing or new, or to ownership of a real
estate or moveable asset, either on a temporary or permanent basis. Profits generated by
that enterprise or real estate/asset are shared in accordance with the terms of the
Musharakah agreement, while losses are shared in proportion to each partner’s share of
capital.
Financing extended without interest or any other compensation from the borrower. The
lender expects a reward only from god.
A Salam contract refers to an agreement to purchase, at a predetermined price, a
specified kind of commodity not available with the seller, which is to be delivered on a
specified future date in a specified quantity and quality. The Institution providing Islamic
financial service as the buyers make a full payment of the purchase price upon execution
of a Salam contract. The commodity may or may not be traded over the counter or on
an exchange.
An equivalent to the contemporary insurance contract whereby a group of persons agree
to share a certain risk (for example damage by fire) by collecting a specified sum from
each. In case of loss to any one of the group, the loss is met from the collected funds.
All Definitions are based on Islamic Financial Services Board except for Musawama which was sourced from
Investopedia