• THE ECONOMIC NECESSITY OF ESTABLISHING ISLAMIC MICROFINANCE INSTITUTES IN IRAN

Abstract

Making use of the available literature in the field of micro finance in conventional economics, this study tries to show that although Islamic banks and Gharz-al-hassan funds are available in Iran, as an Islamic country, it is economically necessary to establish Islamic micro finance institutes and this will strengthen the Islamic banking level in Iran. In addition, the paper tries to look at the characteristics and potencies of Islamic micro finance and also, shed some light on the probable challenges they might face and tries to find some solutions for this challenges. The findings of this study which are based upon theoretical analyses show that the there is room for establishment of micro finance institutions in Iran and this will improve the access of the poor and middle income people to the financial services.