Enhancing financial inclusion through Shari’a-compliant microfinance: A case study of Al-Amal Microfinance Bank in Yemen
DOI:
https://doi.org/10.18559/ref.2025.1.2215Keywords:
Shari’a compliant microfinance, financial inclusion, financial integration, electronic banking servicesAbstract
This study explores the role of Shari’a-compliant microfinance in advancing financial inclusion and improving socio-economic conditions, with a particular focus on serving the financial needs of marginalised populations in rural areas. Through a case study of Al-Amal Microfinance Bank in Yemen, the research highlights the bank’s effectiveness in expanding access to financial services via tailored solutions and strategic outreach. By deploying a network of financial and non-financial agents in remote areas, alongside digital banking platforms, Al-Amal Bank successfully mitigates barriers such as distance, cost and accessibility. The integration of electronic services further enhances financial access, contributing to more inclusive development across the country.
JEL Classification
Financial Aspects of Economic Integration (F36)
Banks • Depository Institutions • Micro Finance Institutions • Mortgages (G21)
Financial Markets • Saving and Capital Investment • Corporate Finance and Governance (O16)
Downloads
References
Abdul Rahman, A. R. (2007). Islamic microfinance: A missing component in Islamic banking. Kyoto Bulletin of Islamic Area Studies, 1(2), 38–53.
View in Google Scholar
Al-Amal Bank. (2021). Annual report 2021. https://alamalbank.com/en/reports/13
View in Google Scholar
Al-Amal Microfinance Bank. (n.d.). About AMB. Retrieved June 25, 2025 from https://alamalbank.com/en/about
View in Google Scholar
Allegret, J. P., Benkhodja, M. T., & Razafindrabe, T. (2018). Monetary policy, oil stabilization fund and the Dutch disease. GREDEG Working Papers, 06. https://hal.science/hal01796312/document
View in Google Scholar
Anderloni, L., & Carluccio, E. M. (2007). Access to bank accounts and payment services. In L. Anderloni, M. D. Braga, & E. M. Carluccio (Eds.), New frontiers in banking services: Emerging needs and tailored products for untapped markets (pp. 5–105). Springer Berlin Heidelberg.
View in Google Scholar
Arab Monetary Fund. (2015). The interrelationship between financial stability and financial inclusion. Regional Task Force for Promoting Financial Inclusion in the Arab Countries. https://www.amf.org.ae/publications
View in Google Scholar
Blancher, M. N. R., Appendino, M., Bibolov, A., Fouejieu, M. A., Li, M. J., Ndoye, A., Panagiotakopoulou, A., Shi, W., & Sydorenko, T. (2019). Financial inclusion of small and medium-sized enterprises in the Middle East and Central Asia. International Monetary Fund, 19(02).
View in Google Scholar
Bramley, G., & Besemer, K. (2018). Financial inclusion, financial stress and debt. In G. Bramley & N. Bailey (Eds.), Poverty and social exclusion in the UK. Vol. 2: The dimensions of disadvantage (pp. 267–288). Bristol University Press.
View in Google Scholar
Bruhn, M., Hommes, M., Khanna, M., Singh, S., Sorokina, A., & Wimpey, J. S. (2017). MSME finance gap: Assessment of the shortfalls and opportunities in financing micro, small, and medium enterprises in emerging markets. World Bank Group. http://documents.worldbank.org/curated/en/653831510568517947
View in Google Scholar
CGAP. (2004). Building inclusive financial systems, donor guidelines on good practice in microfinance. World Bank Group. https://documents1.worldbank.org/curated/en/889551468324553805/pdf/342670ENGLISH0rev.pdf
View in Google Scholar
Dahbia, L., & Soumia, H. (2020). The reality and importance of financial technology in promoting financial services and enhancing financial inclusion in Arab countries. Journal of Advanced Economic Research, 5(2), 93–113. https://www.asjp.cerist.dz/en/article/116355
View in Google Scholar
Dev, S. M. (2006). Financial inclusion: Issues and challenges. Economic and Political Weekly, 41(41), 4310–4313. http://www.jstor.org/stable/4418799
View in Google Scholar
El-Zoghbi, M., & Tarazi, M. (2013). Trends in Sharia-compliant financial inclusion. Focus Note 84. CGAP Publications. https://documents.worldbank.org/curated/en/890971468158998150/pdf/782330BRI0Box00s0Note0840March02013.pdf
View in Google Scholar
Ghanem, M. (2010). The reality of Islamic microfinance and prospects for its development in Palestine (an applied study on the Gaza Strip) [Master’s Note]. Islamic University, Palestine. https://www.findevgateway.org/sites/default/files/publications/files/mfg-ar-the-reality-of-islamic-microfinance-and-its-development-prospects-in-palestine-126067_0.pdf
View in Google Scholar
Haneef, M. A., Muhammad, A. D., Pramanik, A. H., & Mohammed, M. O. (2014). Integrated waqf based Islamic microfinance model (IWIMM) for poverty alleviation in OIC member countries. Middle-East Journal of Scientific Research, 19(2), 286–298. https://www.academia.edu/download/83329859/20.pdf
View in Google Scholar
Hersi, R. (2018). The prospects and challenges of Islamic Microfinance in the IGAD region. Hespi, Working Paper, 03/18. https://hespi.org/the-prospects-and-challenges-of-islamic-microfinance-in-the-igad-region/
View in Google Scholar
Honohan, P. (2008). Cross-country variation in household access to financial services. Journal of Banking & Finance, 32(11), 2493–2500.
View in Google Scholar
Iqbal, Z., & Mirakhor, A. (2012). Financial inclusion: Islamic finance perspective. Journal of Islamic Business and Management, 2(1), 34–64.
View in Google Scholar
Karim, N., Tarazi, M., & Reille, X. (2008). Islamic microfinance: An emerging market niche. Focus Note 49. CGAP Publications. https://www.cgap.org/sites/default/files/CGAP-Focus-Note-Islamic-Microfinance-An-Emerging-Market-Niche-Aug-2008.pdf
View in Google Scholar
Khan, F., Siddiqui, M. A., & Imtiaz, S. (2022). Role of financial literacy in achieving financial inclusion: A review, synthesis and research agenda. Cogent Business & Management, 9(1), 2034236.
View in Google Scholar
Leyshon, A., & Thrift, N. (1995). Geographies of financial exclusion: Financial abandonment in Britain and the United States. Transactions of the Institute of British Geographers, 20(3), 312–341.
View in Google Scholar
Mazumder, S., & Korhonen, M. (2019). The impact of Financial Inclusion Economic Growth: Literature Review [Master’s Thesis]. Department of Economics. University of Oulu. http://jultika.oulu.fi/files/nbnfioulu-201911223157.pdf
View in Google Scholar
Messah, O., & Bessachi, H. (2023). The reality of Islamic microfinance in the Bangladesh Islamic Bank. AFAQ Review of Research and Studies, 06(01), 54–63. https://asjp.cerist.dz/en/downArticle/665/6/1/213923
View in Google Scholar
Nasr, S., & Rostom, A. M. (2013). SME contributions to employment, job creation, and growth in the Arab world. Policy Research Working Paper, 6682.
View in Google Scholar
Saber, M. A. A. (2023). Financial technology and its role in promoting financial inclusion: An analytical study of a group of Arab countries. Alexandria Journal of Managerial Research and Information Systems, 1(1), 95–110.
View in Google Scholar
Sain, M. R. M., Rahman, M. M., & Khanam, R. (2016). Financial exclusion in Australia: Can Islamic finance minimize the problem? Australasian Accounting, Business and Finance Journal, 10(3), 89–104.
View in Google Scholar
Walters, B. (2011). Islamic microfinance: Sustainable poverty alleviation for the Muslim poor. Conn. Pub. Int. LJ, 11, 255–296. https://heinonline.org/HOL/LandingPage?handle=hein.journals/cpilj11&div=15&id=&page=
View in Google Scholar
World Bank. (2022). Global Findex Database 2021: Financial inclusion, digital payments, and resilience in the age of Covid-19. World Bank. https://openknowledge.worldbank.org/entities/publication/b74e1909-3ecf-5009-b51c-8527fc4eefeb
View in Google Scholar
Downloads
Published
Issue
Section
License
Copyright (c) 2025 Mourad Hamadi, Abdelfateh Tebani, Abdeslam Hetatache
This work is licensed under a Creative Commons Attribution 4.0 International License.
The Research Papers in Economics and Finance (REF) is committed to open access. All of the REF` s paper are free to access immediately from the date of publication. There are no author charges, known as APCs, before release, and no charge for any reader to download articles.
The Creative Commons Attribution 4.0 International license (CC BY 4.0) applies to articles published in Research Papers in Economics and Finance from Vol. 4, No. 3, 2020 to present. This license is acceptable for Free Cultural Works. You are free to share and adapt. You must give appropriate credit, provide a link to the license, and indicate if changes were made.
The Attribution-NonCommercial 4.0 International license (CC BY-NC 4.0) applies to articles published in Research Papers in Economics and Finance up to Vol. 4, No. 2, 2020 inclusive. You are free to share and adapt. You must give appropriate credit, provide a link to the license, and indicate if changes were made. You may not use the material for commercial purposes.
How to Cite
Editorial Office: Research Papers in Economics and Finance 