The Family Bank, a microfinance bank licensed by the Central Bank of Bahrain, has announced plans to provide collateral-free micro-credits to its customers under a new scheme.

Under the agreement, signed with Eltizam Islamic banking consultant firm, the bank will provide Sharia-compliant loans ranging from BD500 to BD7,000 ($1326 to $18,565).

"This is the third financing product launched by the bank to meet the needs of customers," Bahrain Social Development Minister and bank chairperson Dr Fatima Al Balooshi said.

Family Bank chief executive officer Dr Atef Al Shabrawi sealed the deal with Eltizam director-general Husam Yusif.

The ceremony marked the launch of the Sharia-compliant product which will provide capital to operate micro-businesses.

Dr Al Balooshi described the initiative as a quantum leap for the bank which seeks to develop its micro-financing products and meet the needs of targeted citizens.

Under the deal, the recipients themselves will purchase the goods, which ensures fast dividends and promotes self-management, responsibility and self-confidence among the beneficiaries.

"This is one of the key goals of the bank, being the main sponsor and wholesale-funding establishment of low-income social categories," Dr Al Balooshi said.-TradeArabia News Service