Proposing a Novel Credit-Plus Model to Utilise Islamic Social Finance Instruments for Islamic Microfinance Programmes and To Enhance Financial Inclusion in Nigeria

More than 800 microfinance banks currently operate to drive the government's poverty reduction initiatives in Nigeria. However, the primary goal of eradicating poverty remains unachieved. Additionally, the current Islamic microfinance frameworks are unable to improve the general socioeconomic circumstances of the nation's impoverished. To improve the rate of financial inclusion in Nigeria, this study investigates the potential of Islamic microfinance to support the impoverished in a society that values respect and dignity. In particular, the objective of this research is to develop a novel Credit-Plus model to critically examine Islamic Microfinance strategies to utilise Islamic Social Finance instruments for sustainable financial inclusion in Nigeria. It uses a qualitative approach, gathering information from both primary and secondary sources. 16 Islamic finance experts who hold prominent positions in different Islamic social finance institutions, Islamic microfinance organisations, and regulatory bodies in Nigeria were also asked to provide their expert comments using a typical open-ended semi-structured questionnaire. In this study, a Credit-Plus model is proposed based on a synergistic interaction between Islamic social finance organisations and Islamic microfinance institutions, considering Nigerian perspectives. The results show that, if properly implemented, this new model can greatly benefit Nigeria's impoverished population by increasing the rate of financial inclusion. If the recommendations and strategies outlined in this study are effectively put into practice, they could lead to significant progress in reducing poverty. Essentially, the successful integration of Islamic microfinance and Islamic Social Finance into Nigeria's financial landscape could pave the way for a more inclusive and prosperous future, as it not only addresses immediate economic needs but also promotes long-term growth and stability.

Islamic Social Finance, Islamic Microfinance, Credit-Plus Model, Financial Inclusion, Poverty Reduction, Nigeria, Microfinance Banks,

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