Some Interesting News on Kafalah
Kafalah Definition: Like a lot of other terms that are used in Islamic financing, this one is about contracts and legal matters that all fall under sharia compliance. Particularly, Kafalah is the Islamic term for a specific contract where the debtor is replaced in front of the creditors by another party.
Kafalah was recently introduced by a United Nations Convention on the Rights of the Child in 2014 and offered up as a alternate way to provide care for children deprived of family. It was the very first time this Islamic idea was recognized as binding internationally.
It’s good news for those keeping an eye on the ideas that tie together with Islamic financing. Here’s some other news that ties together with kafalah we thought you might find interesting.
- People understand how dramatically Islamic financing is growing globally. The Islamic Financial Services Board has even
reported that the current market is worth almost $2 trillion. Islamic financing and by proxy kafalah works to bring justice to many different verticals like infrastructure, banking, manufacturing and trade.
- Not everything has been proceeding smoothly. For example, a recent article in the Jordan Times points out the fact that there is in fact some opposition to this Islamic finance principle as it pertains to work permits for migrant workers.
We stay on top of all of the recent developments. Why? Because we strive to be your number one resource for information and processes here at IjaraCDC. Getting started is as easy as using our toll-free telephone number on the website or clicking the ‘get started’ button that’s located there.
The Islamic financing method that we adhere to stays in accordance with all Islamic sharia guidelines. Our priority is to constantly streamline the process of applying and accessing Islamic loans.
In other recent news developments, the Kafalah program in Saudi Arabia was worth more than SR21 billion ($5.6 billion) last year alone. A recent report detailed how this aspect of Islamic financing was bringing positive changes to certain sectors. In fact, data shows there have been over 10,000 success stories in a different range of industries and a variety of sectors.
Businesses that decided to participate in the program last year reached 1793. That marked an increase of almost 5% compared to the previous year.
The previous obstacle was the inability of smaller businesses to get the funding they needed. Required bank guarantees were another obstacle before the program was expanded.
The idea is to grow this program in the private sector so that it can continue the mission of Islamic financing to create social justice.
We are always available to answer any and all of your questions. You can contact us at your convenience to learn more about Kafalah.