Charity to Sustainable Enterprises

Dr Ikramullah Salarzai

Bajaur: Charity has always been a foundation of human societies, providing relief and support to the needy through the donations of individuals and organizations.

However, giving money to those in need is a kind act, but it only helps for a short time without long-term self-sufficiency. In recent years, a transformative approach has emerged, wherein charity money is invested in establishing businesses, thus creating sustainable economic opportunities for the underprivileged people.

This innovative model not only empowers beneficiaries but also promotes economic development and social progress. While giving alms fulfills an immediate need, it often fails to provide a lasting solution. Recipients of charity can become dependent on aid, lacking the means or opportunities to break the cycle of poverty. 

Moreover, the resources provided are typically finite, and without a system to regenerate these resources, the assistance may run out, leaving beneficiaries back in their original state of need and then asking for another doze.

Investing charity money in business ventures offers a promising alternative. By funding small enterprises or cooperative projects, charitable organizations can create self-sustaining sources of income for the poor. This approach transforms the act of giving from a one-time handout into a sustainable livelihood. 

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Investing charity money in businesses ongoing income, reducing generates the need for repeated external aid. This approach raises  empowerment, enabling individuals to improve their lives and contribute to their communities.

Business ventures stimulate local economies, create jobs and drive innovation, offering a more effective and sustainable solution to poverty.

Grameen Bank, founded by Muhammad Yunus in Bangladesh, is a key example of how small loans (microfinance) can empower individuals to start their own businesses.

Providing the poor, especially women, with access to capital, Grameen Bank has enabled millions to lift themselves out of poverty through entrepreneurship. “One for One” model of Toms Shoes is another best example to this effort, where they initially donated a pair of shoes for every pair sold.

However, the company has since changed its model to include the creation of jobs in the communities. Toms Shoes, established local manufacturing facilities, wherein employment and skill development opportunities were provided.

Toms Shoes, originally based in the United States, has expanded its presence to countries including Argentina, Ethiopia, South Africa, Haiti, India, Kenya, Mexico and Nepal. 

In Pakistan a key example of how philanthropic endeavors can be turned into profitable businesses is the Akhuwat program, which was initiated by Dr Amjad Saqib and offers interest free microloans to the deprived people so they can take-off their own businesses and become financially independent.

Having disbursed billions of loans and lifted countless people out of poverty, Akhuwat serves as a testament to the vast potential of microfinance to generate long term economic opportunities.

In some of the poorest areas, like the newly merged district of Bajaur in Khyber-Pakhtunkhwa, people face great hardships in maintaining their daily bread.

The local population primarily depends on agriculture and other subsistence-level livelihoods, including laboring in other districts. With each passing day, the situation worsens, and many laborers often turn to asking alms in bazaars and other areas. 

Jawad Iqbal, an engineer by profession and a social activist, has introduced a transformative approach by turning charity into business opportunities. Jawad himself, through reliable sources, collects data of the poor who have the ability to work. With these insights and minimal resources, he has created many small business opportunities for the people of Bajaur.

He works hard in this field and has so far created businesses and small enterprises for more than 50 people, and an even more encouraging aspect is that 40% of these beneficiaries are women. 

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Jawad’s model has significant contributions towards ending the begging concept as he started small businesses like establishing low cost small shops, expanding existing businesses, providing hand carts, barrows, and similar small enterprises. This has proven to be one of the best practices for creating a sustainable source of livelihood for needy people.

Jawad leads the foundation, which has been supported by other dedicated social workers in the area. Those donating for the welfare of poor people should consider directing their contributions to Jawad and others working in this field to foster business opportunities for the local population.

Additionally, government departments, particularly social welfare, Ushr, and Zakat, should embrace and promote this model.

While this model offers great promise, it faces challenges. Potential pitfalls include the risk of failure, as not all businesses succeed, and the failure of an enterprise can lead to the loss of invested charity funds.

Beneficiaries often require training and mentorship to successfully manage and grow their businesses. Additionally, external economic conditions can impact the success of charitable business ventures, as poor market environments can hinder growth and profitability.

Charity transformation into business opportunities marks a paradigm shift in poverty alleviation, and is emerging as a basic factor in reducing begging. This model prioritizes sustainable, long-term solutions, tackling the immediate needs of the poor while also empowering them to achieve self-sufficiency and drive economic growth.

As more organizations adopt this innovative approach, the potential for creating lasting, positive change in communities around the world increases significantly. The future of charity does not lie in just giving alms but in building businesses that lift people out of poverty permanently.

The writer is a government servant in KP’s Tribal Region, serving in a capacity that likely involves administration or governance within the region.