Helping Hand for Relief and Development’s Esaar Microfinance was started at large scale with the objective to contribute to increase economic opportunities in the underprivileged areas of Pakistan. Following integrated approach, the program is providing opportunities to increase income of beneficiaries to earn livelihood for their families by undertaking productive income generating activities. The Islamic approach emphasizes on microenterprise development through financial and non-financial assistance adhering to principles of transparency, brotherhood & cooperation and Islamic values. The program operates in 25 districts of Pakistan & AJK and most of the areas are rural and far-flung.


    • To enable economic wellbeing and resilience for people with low incomes, especially suffering the disaster through interest free microfinance.


    • Provide social assistance, capacity building and integrated development ingredients to support the poor break the poverty cycle by creating the spirit of brother-hood.


  • To institutionalize the Esaar Microfinance regarding sustainable, growth-oriented and replicable one

Foundations of Esaar Microfinance

The fundamentals of Esaar Microfinance is based on three Principles
Charity – Source of funding from Muslim donors
Prohibition of Riba – Riba is not just Haram, harmful for economy
Brotherhood and Scarify – Social networking: Community Mobilization & Organization lead to social collateral
Esaar Microfinance Model has some very unique characters which distinguishes it from many other organizations

Modes of Esaar Microfinance

  • Murabaha: is a trade based mode of financing which Esaar Microfinance uses for providing seeds and fertilizers to farmers and merchandize to businessmen and other material for income generating activities
  • Mudaraba: Through this mode the organization provides needy people with the calf for nourishment. On selling the animal, profit is distributed among Helping Hand (Raba al Mal) and Beneficiary (Mudarib).
  • Qard-e-Hassan: This Interest free loan is given for the rehabilitation of windows and physically disabled persons. Through this they can fulfill their personal and social needs.

Proposed Islamic Modes of Financing
Pakistan and Sudan Leading in Islamic Microfinance Industry

  • Salam: This mode is used to purchase crops from farmer. Through this mode, Institution purchases the crop in advance (which the farmer will grow) and pays him the full amount. With that amount farmer can fulfill his agriculture needs. When the crop is received the institution sells the crop to third party and recovers the amount.
  • Diminishing Musharakah: Musharakah is based on the principles of partnership. Through this method Institution and beneficiary jointly purchase an asset which remains in the use of beneficiary for which he pays rent.

Abdul Haq – Chitral

Pakistan and Sudan Leading in Islamic Microfinance IndustryAfter completing his Intermediate he wanted to obtain admission for Bachelor for his degree. He wished to get more education but it remained only a wish. Abdul Haq’s parents were not in a position to fulfill the wish of their son and were demanding him to support their family. So he left college and started helping his father in the shop. His father was running an electrical store in Sheiqotek village of Chitral. His father was aged and day-by-day it was proving very difficult for him to sit at the shop. When Abdul Haq’s father saw that his son could run the shop efficiently he started staying at home. Abdul Haq was young and energetic and very soon he increased the size of business. Abdul Haq’s house was near a village stream. He said that there were many benefits of being near a stream but also some disadvantages. In the monsoon seasons 2011 there was heavy rainfall in all of the country. The union council of Chitral also received heavy rainfall. Rain caused flash floods in small streams. Abdul Haq also suffered from the flash flood and his house was partially destroyed. His crop was totally destroyed and he also lost his farm animals. He had an accumulated loss of more than Rs 100,000. Luckily his shop remained undamaged in the flood which helped him to recover his loss. Though his shop was running well but he had to cover the loss of his house, crop and animals and the shop was the only source of income. He repaired his house and purchased the animal but at the cost of the material which he had to purchase for his shop. As a result the duration of the business cycle prolonged and as a result the profits decreased.

Worried about the condition of his business he wanted to take a loan for his shop. But no one in the locality was in a condition to give him loan. One day he went to the bank for some transaction where he heard from the bank manager that an organization was providing financial assistance. He went to the given address and saw the office of Helping Hand for Relief and Development. He discussed his case with the representative of Helping Hand who asked him to provide the necessary documents. Within a few days the case of Abdul Haq was approved and he was given electrical material for his shop worth Rs 30,000. He was given material by Helping Hand’s Esar Microfinance through Murabaha facility and few days after receiving the material his sales grew higher than the original position and his business turnover increased.

“I was very concerned about my business and it was going down day by day after the flood. I tried to get loan but no luck. Helping Hand was a blessing in disguise for me. Providing material to me proved to be very effective for me. My business increased manifold and the business cycle period reduced form 1 month to 15 days. My profits have also increased and the profit which I was earning in a month, now I earn in 15 days. I was earning a monthly profit of only Rs. 2000 and now I am earning more than Rs. 4000 a month. Before Helping Hand’s help the material in my shop was only wires, energy savers, buttons and other small items. Now I am also dealing in washing machines and machine spare parts. I’ve added furniture in my house and my quality of life has also improved. I’m also saving Rs. 2500 per month out of my income. All that was possible only with the help of Helping Hand and ESAR Microfinance.

Ahmad Ali – Jacobabad

Pakistan and Sudan Leading in Islamic Microfinance IndustryAhmad Ali son of Muhammad Hassan was the Resident of village Thul district Jacobabad of Province Sindh Pakistan. The area is sandy and cultivation is not possible in that region. Most of the people are uneducated and earn their livelihood by cattle farming and labor. Ahmad Ali wanted to get more education after completing his intermediate. But the poor financial conditions of his family stood in the way of his education. He then quit the education and learned the skill of cloth sewing and soon established his own tailoring shop in the village. Like the other residents of the village, he also had livestock. He had animals of worth Rs. 120,000. His monthly income was about Rs. 22000. His income was not much for a big family of a wife, 3 children and two younger brothers, yet he was able to sustain a better living.

In year 2010 heavy rain fall and flood devastated the entire area. Like other people, all the belongings and the animals of Ahmad Ali also swept away. The disaster made the living of the people very hard. Situation became worst as Ahmad Ali was short of finance to run his tailoring shop. He was in dire need of money to purchase the buckram for his tailoring shop. But there was nobody in the village that could finance him as whole people were facing same circumstances. Due to religious concerns he didn’t want to raise loan on the interest basis. His house and shop was damaged by the flood. All his animals were swept away. Ahmad Ali was in great trouble. He by no means was able to take care of his family. He was worried about his conditions when the survey field officer of the Helping Hand met him. Ahmad Ali narrated all his tragedy to him and requested a loan of Rs. 15,000 for purchasing the buckram. The correspondent after making satisfactory investigations promised to raise his case to the administration of HHRD.

HHRD finance wing approved a loan (Qard Hassan) of Rs. 15,000 for purchasing of buckram for the tailoring shop of Ahmad Ali. By this loan Ahmad Ali reinstated his business. His financial positions have been improved. His income increased day by day and he started saving Rs. 3,000 rupees per month. He restored his cattle and livestock. After a year he earned a profit of Rs. 22,000.

His life style has been improved. His house hold expenditures are standardized. His family enjoys better living conditions. Now his brothers are getting education in a private school.

“Heavy rainfall and flood destroyed all my valuables. My house was damaged. At the very worst, I didn’t have enough money to carry forward my business. I was unable to purchase the buckram for my tailoring shop. It was impossible for me to raise lone on interest. The people were demanding their clothes. Helping Hands appeared as an angel of mercy for me. They helped me to carry forward my business. They finance me to purchase of buckram that helped me to stand on my feet again. My profit increased manifolds. My family enjoys better living conditions. I am saving Rs. 3000 per month. My brothers are getting education in private schools. All this is possible only because of the help of Helping Hand and its ESAR Microfinance.

Name of beneficiary: Malik Asif Iqbal

Pakistan and Sudan Leading in Islamic Microfinance IndustryHe was only 10 when his father died. His siblings were very young, so his mother had to bear the burden of raising the family of 6 people. His father was a farmer and left for his family 10 acres of agriculture land. His mother started working on the fields all day long. She put up all her efforts in order to make her family live a better life. It was due to her mother’s tiresome efforts, he was able to get education till matriculation. After completing his education he started helping her mother in the fields. With more people working in the farm their financial conditions were going stable.

Everything was going fine until the flood of 2010 hit their area. Then their bad days started. Their wheat crop was ready for cultivation in 10 acres of land. Their entire crop was completely destroyed with the flood water. Moreover, flood also claimed the lives of their domestic farm animals. Destruction of their house further increased their problems. Like other people in the area, Asif’s family was forced to live under open sky waiting for government institutions and NGOs to help them.

HHRD commenced its program “Revival of Livelihood for affected people from flood 2010” for the relief of flood affected areas. HHRD’s team also visited Asif Iqbal’s village and offered Interest-free microfinance loans for the revival of flood affected people. Asif also applied for the loan and got Rs 20,000 through Qard-e-Hassan. With that amount he purchased farm animals (goats) which proved to be very beneficial for Asif. Due to interest-free loan and abstaining from interest based loans, Allah showered his blessings upon him. He has paid all amount of loan and currently has Rs 60,000 worth of farm animals (goats). Now he successfully earns his livings through animal breeding and also though farming.

Asif was very satisfied with HHRD’s program and reported that “due to flood we lost everything. HHRD granted me Qard-e-Hassan which was very beneficial, with Rs 10,000 out of total loan I purchased goats. Now I’m owner of goats worth Rs 60,000”. He was so satisfied with the program that he decided to get advantage from HHRD’s Interest free microfinance program ‘Murabaha’ for his farm.

With other fellow farmers, Asif used to purchase fertilizers from middleman on credit, who charged high prices on it. He used to charge 5000 Rs for one bag, which had market price of 4000 Rs per bag. And the delivery of fertilizer was very late, that resulted in very poor production of crop. Moreover, Asif and other farmers were bound to sell their crop production to the middleman. When the crop was harvested and sold to the middleman he used to purchase crop at cheaper rate than market. Asif informed that “the middleman was exploiting us. We were forced to purchase fertilizers from him at higher rates than market and to sell our crop to him. Which he purchase at lower rates than market. We didn’t have cash to purchase fertilizer so we had to go to the middleman for credit purchase, we had no other option”. The middleman used to purchase 500 Rs per bag less than market price which resulted in Rs 25,000 to Rs 30,000 loss per year to these farmers.

Already taken facility from HHRD, Asif applied for IFMF’s ‘Murabaha’. HHRD provided him fertilizer having cost of Rs 27,030 according to his need. Asif received fertilizers at the accurate time when he needed and at much cheaper rate than what he used to purchase from the middleman.

With the support of HHRD, Asif’s crop for the year was doubled as compared to the previous year. He sold his crop freely in the open market at prevailing market rate without involving the middleman. On selling his crop he received almost Rs 60 to 70,000 additional amount as compared to selling to the middleman. Asif easily paid back the price of fertilizer to HHRD. He was very happy for his good crop and was also happy that he finally got rid of the middleman. He was positive that he will be having surplus cash to purchase fertilizer and wouldn’t need middleman. Asif Iqbal is thankful to HHRD for its enormous help at the time of disaster. He also advises his fellow farmers to take Murabaha facility from HHRD and get rid of the middleman and profit.

Rakhmat Jan

Pakistan and Sudan Leading in Islamic Microfinance IndustryFor more than 30 years my husband worked as a carpenter. He had his own shop in village Lamnian, Hattian Bala, AJK. Ten years back we renovated and reconstructed our house. We built additional rooms and had proper roofing and flooring. Income of my husband was sufficient to meet the daily expenses and other needs. Yet, we were living a prosperous life with our five sons and three daughters. After three years the disastrous earthquake of 2005 hit us. The most affected areas were Balakot and AJK. Thousand died and millions became homeless. We were one of the people who lost their homes. Decades of savings and investment were lost within seconds. We were hopeless and helpless sitting under open sky spending chilled days and nights without a piece of blanket. However, those days passed and we found a way to manage out our living. We went to lower area and rented a house there. My husband as skilled man soon found some work. Months and years passed we lived in that same rented house. We then decided to rebuild our house that was destroyed in earthquake 2005. For that, we gathered our savings and took loan from many people. We were able to rebuild the house and immediately shifted in our house, a year back. After our shift we faced many problems. My husband had to reestablish his work, as we took many loans for the construction of our house we had to repay and many other issues. The earning of my husband was not enough to meet all of our expenses after separating savings for repayment. Conditions were becoming difficult day by day. We were thinking everyday what to do to improve our living. My elder son tried very hard to get himself employed but he never found work.

We were all frustrated with our conditions until I decided to do what a Pakistani woman is generally not allowed to do. I decided to open a convenience or general store. When I shared my decision with my family, everyone was shocked on hearing this. My children and my husband were not allowing me to run a shop and they were quarrelling with me. When I told them the current situation, we were facing, they stop arguing with me but still they were not looking convinced. I told them that I will open the shop in the house and not in the market. They were a bit relieved to hear that. So I started the shop with some very basic and very limited material which I purchased from the wholesaler on credit. When some of the material was sold, I paid the amount to that wholesaler. After some months I had a quite significant amount of material available in my shop. Though the earning was not pretty much but something is better than nothing. After analyzing the duration of the shop and the sales, I decided to take a step further. I was thinking to take the loan to increase the scale of my shop so that my earning could be increased. Though the decision was very good and everyone appreciated this but the problem was something else, from where to get the loan? That was giving me a hard time. I tried to ask this favor from the friends and relatives but they were not in a position to give loan what I had in mind.

After waiting for a long time my neighbor Shamim Bibi told me about Helping Hand. She told me about the program and local community organization. I contacted to my local CO and started attending meeting and the process looked good to me. So I applied for Qarad Hasan of Rs. 18,000, after some necessary procedures HHRD provided me an interest free loan (Qarad-e-Hasan) amounting Rs. 15000. The specialty of this loan is not any extra amount charged in shape of service or markup. With the loan given I purchased material for my shop. Due to this amount my monthly income increased to 3500-4000 rupees. The reason of my low income was the limited kind of products. Now I have added additional variety of products in my shop and customers are now satisfied. We are gradually paying back the loans we took for the construction of our house. After the repayment of Qard-e-Hassan, now I can manage easily my monthly expenses and I can also save some amount.

With HHRD’s financing support I am very satisfied and living a happy life. I am personally very thankful and obliged to HHRD for the help provided that proved supportive to uplift living standard and minimize the difficulties for me and other women and praying for the development of this organization.