Islamic Financing Initiatives Stimulating SMEs Creation in Muslim Countries

Abstract

The challenge for Islamic Finance institutions is to find solutions and develop programs helping to invest these funds in supporting projects, SMEs, and entrepreneurship. In this paper, a documental collection, revision, and analysis were performed to catch the best practices and experiences adopted by these institutions to maintain sustainable development and support SMEs and entrepreneurs. Among other things, the findings showed the adoption of a multitude of mechanisms and programs that not only fund entrepreneurs but also offer technical support to their projects and ideas. The research suggests that different Islamic financing institutions adopt the observed best practices and experiences throughout the world. It also highlights the importance of the collaboration between the financial institutions, the government, the private sector, and NGOs to maintain a climate encouraging entrepreneurs and facilitating entrepreneurship. Findings are supported by the development of a new model showing the keys guaranteeing the success of investment and entrepreneurship.