This Muslim lending society in Bihar is empowering needy Hindus

(Dr. Shujaat Ali Quadri)


Brotherhood and working together are common in our community, but the examples of Muslim community organizations bringing about a change in the lives of Hindus undoubtedly strengthen communal harmony in the changing society. One such example was seen in Bihar’s Patna, where the Muslim Co-operative Credit Society has transformed the lives of thousands of Hindu families by providing interest-free loans.

Kamala Devi, Pankaj Kumar, Geeta Devi, and Sanjay Singh come from the same families to whom the Al-Khair Co-Operative Credit Society Ltd. has provided interest-free loans to start their business for their livelihood. About 9,000 Hindus have been given loans by this society to set up businesses. These mainly include vendors, small traders, shopkeepers on the tracks, marginal farmers, and women.

Kamala, who runs a shop in Patna’s Mirshikar Toli, said, “I used to sell potatoes and onions on roadside tracks. For this, she used to take a loan of Rs 2,000 to 5,000 from moneylenders on interest and was always buried under their debt. But a few years back, when someone told me that the  Al-Khair Society gives loans without interest, I was surprised. She first took a loan of Rs 10,000 from the society to run the shop. After that she took a loan from the society from Rs.20,000 to Rs.50,000.

Kamala said, “I have opened a wholesale shop by taking a loan from the society, expanding my business from a small stall shop.” Kamala now has so much money that she is able to arrange the education of her two sons herself. One of her sons studies in an engineering college and the other is doing B.Ed.

Kamala said that she pays some money from her earnings to the Society in the form of installments so that the debt is cleared.

Al-Khair Society, following Islamic values, has provided loans worth Rs 50 crore to about 20,000 people in the last decade. Most of these included people who were struggling to earn a living. About 50 percent of the beneficiaries of the society are Hindus. It is evident that the  Al-Khair Society rises above religious discrimination and helps the needy.

Like Kamala, Geeta Devi has also opened a big shop on the roadside instead of her small vegetable shop. She has also helped her son to open a vegetable shop.

Geeta says, “My life changed after coming in contact with the  Al-Khair Society. It helped us live a life of dignity. For poor people like us, interest-free loans are a boon. There is no uncertainty of getting loans from banks, let alone sans interest.

Another beneficiary Sanjay Singh said that banks are not interested in giving loans to small shop owners. He said, “The bank not only charges interest on the loan but to take the loan, it is also required to fill and submit several types of documents, which is not possible for the poor.” Sanjay has a small cloth shop, which is run by his wife while he sells clothes by roaming around on a bicycle.

Shamim Rizvi, a retired bank official who has been associated with the  Al-Khair Society for nearly a decade, said, “Interest-free loans are part of the Islamic banking system as interest is considered unfair in Islam. But it ( Al-Khair Society) gives interest-free loans not only to Muslims but to people of all religions.”

Nayer Fatemi, managing director of  Al-Khair Society, says that interest-free loans are getting popular. “For those who do not have access to the bank, even a small amount of Rs 5 to 10,000 is very important. About 50 percent of the people getting interest-free loans are Hindus. Most of the people take loans to run their livelihood, which is empowering them,” Fatemi added.

Al-Khair Society is an example of a successful micro-finance institution providing interest-free loans. It has brought smiles to the faces of thousands of people. The society started with a small fund and initially had only two employees in a small office in Patna. But today 100 employees work in the organization. For the salary, office rent and other expenses of these employees, it charges a nominal service charge from the borrowers.

The foundation of this organization was laid at the beginning of the year 2000 with few educated people from the Muslim community. The aim of the organization was to provide financial help to the needy people irrespective of religion, caste, and class.


(The Author is Chairman of Muslim Students organisation of India)

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