Ihsan Trust: Alleviating poverty through Interest-free educational loans.

• Author: Arif, Mohammad

Byline: Mohammad Arif

The economic survey held in 2016 states that 39% population of Pakistan live in multidimensional poverty, which implies that they are deprived of necessities of life. Although, poverty in Pakistan is not a new discovery. It is high time that the corporate, social, and government sector work collaboratively and collectively to alleviate poverty from Pakistan. Where corporate and government sector can financially support this concept, social sector plays a vital role in realizing it.

Poverty can be alleviated through many sources, however, in order to sustain poverty alleviation, Education is the key. Unfortunately, education has by far been the most neglected necessity in Pakistan. Where education can open the doors of opportunities for many, poverty is the main reason for them to not even approach that door. Utilizing time in seeking education and specially higher education is seen as an opportunity cost. It is a vicious cycle.

Ihsan Trust was established to break this vicious cycle through microfinancing. Ihsan Trust (IT) is a non-profit organization based in Karachi that introduced the idea of interest-free educational loan in 2010. Understanding the importance of higher education in alleviating poverty, this Riba free microfinancing is focused on providing more and more underprivileged students financial assistance while acquiring higher education. Affiliation with 130+ universities and professional bodies across Pakistan,

The model of Ihsan Trust is such that IT directly transfers the funds to the universities/institutions where its students are pursuing their higher education. In return, the students are asked to repay the loan via token monthly installments (on mutual agreement basis) even during the study period, providing its student an easy way to repay the entire loan and also complete their education.

The universities affiliated with IT are not only limited to big cities, rather the universities located in far reach areas are also affiliated with Ihsan Trust. IT aims to help the students in acquiring higher education so that they can change their financial condition. The mission of IT is to raise the standard of living of underprivileged, downtrodden and neglected sections of Pakistan and make their next generation strong enough to compete with the world.

Basically, Ihsan Trust provides financial assistance to the un-bankable population of Pakistan. The students with weak financial background are normally...