Islamic Vs Conventional Social Finance: Comparative Perspectives and Implications, Pakistan a Case in Point
DOI:
https://doi.org/10.58352/tis.v51i1.981Keywords:
Islamic Social Finance-Conventional Social Finance-Societal Impact-Social InclusionAbstract
Purpose: This paper seeks to take a comparative view of Islamic and conventional social finance in the contemporary environments with Pakistan as a case in point. In its holistic outlook, the term social finance refers to the mobilization of financial means for the collective uplift of society, which includes poverty alleviation, meeting urgent needs of the individuals, and their social inclusion. The paper maintains conceptual foundations, operational management, accountability, sustainability and measurements of social impact in focus.
Method: The research is quantitative as well as qualitative in nature, hence follows the mixed method approach. Accordingly, the sources of data include relevant official websites, non-governmental organizations, charity platforms, individuals receiving social assistance and donating societal groups. In addition to rich literature review, interviews and panel discussions provided insights into the existing practices in both the domains i.e. Islamic and conventional social finance. Secondary data as available from open sources has been used to draw relevant statistical inferences.
Findings: Pakistan’s social finance system, like many other countries especially of South Asia works on hybrid mode i.e. conventional, mostly under the state control and Islamic, predominantly by the individuals on totally personalized as well as in collective manners. The study concludes that although social finance network is very strong in countries like Pakistan, it serves to meet subsistence needs of the individuals, hence falls short of uplifting the social status of the people as a permanent solution. In some cases, it rather makes them inherently dependent, unproductive members of the community and undesirable example of living beings. At the same time, it is found that there is no scientific way of measuring the impact of such social financing in either case i.e. conventional as well as Islamic.
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