Ethis Ventures, a venture firm based in Malaysia, announced on Thursday it has signed a crowdfunding partnership agreement with the Islamic Development Bank Group (IDB) at the IDB Annual Meeting in Tunisia.
According to Ethis, The IDB, under the dynamic leadership of President HE Hajjar Bandar, has embarked on a five-year transformation plan to strategically position the bank for success in the new economy. Fintech is a key focus area in this plan. Ethis will reportedly embark on the pilot phase of this partnership in the month of Ramadan, with a crowdfunding charity exercise with an initial target to raise US$1million on its GlobalSadaqah platform. While sharing details about the collaboration, Umar Munshi, the founder of Ethis, stated:
“This partnership is a big step for Islamic Fintech. It’s the first where a multilateral development bank takes the leap to bring new and innovative funding solutions into its own established ecosystem. We believe that this partnership will be the catalyst for large-scale fundraising through Islamic Crowdfunding. We also believe that this will inspire more partnerships between large established financial institutions and Islamic Fintech entities. It’s a trend that is just starting in OIC member countries and it’s most heartening to see that the Islamic Development Bank leading the way.”
Ethis also revealed it came to prominence with EthisCrowd, its first platform in Singapore that matches investors from around the world to social housing development projects in Indonesia. Over the past two years, the 25,000-strong EthisCrowd community funded projects to build more than 5,000 homes for low-income families. Risks are reduced by plugging into a government-backed (sovereign) mortgage program which enables crowd-investors to exit profitably. The firm went on to add:
“When applied to charity, Crowdfunding provides a transparent platform for a fast and easy act of giving. Most platforms provide periodic updates to the crowd, which brings a heightened level of accountability to fundraisers. Crowdfunding charity blends the ease of e-commerce transactions while rewarding givers with the feel-good experience of humanitarian or volunteer work on their personal devices. Islamic Crowdfunding, in particular, is expected to bring positive disruption and greater efficiency to Islamic Social Finance, which includes Zakat, Sadaqah and even cash Waqf. This potential will be tested in the current pilot phase, where GlobalSadaqah.com will raise funds for two of the IDB’s flagship programs.”