Maharashtra’s Muslim population and the Mumbai base
Islamic finance in Maharashtra covers the interest-free credit societies, state minority lending bodies and endowment institutions that serve a Muslim community of 11.54 per cent of the population, in a state of 112,374,333 people at the 2011 count. Mumbai, the capital, is by far the largest city, with 12,442,373 residents within municipal limits, while Pune, Nagpur, Chhatrapati Sambhajinagar (the former Aurangabad) and Malegaon are other centres of note.
The state also leads the country in inward remittances, with a 20.5 per cent share in 2023-24 according to an RBI survey. That figure covers all migrants and all communities, so it is no measure of Islamic finance as such, yet it shows how much money moves through the state’s banks and why a search for ethical ways to hold and lend it is natural.
The legal ground is the same everywhere. Banks work on interest under the Banking Regulation Act, 1949, and India has no licensed Islamic bank. Nothing in Mumbai changes that. What the city has instead is a history of cooperatives, some still working and some failed, and a state agency created in 2000. Each is described below, with advice on what to ask for.
Janseva and the Mumbai credit cooperative model
Janseva Co-operative Credit Society Ltd, based in Mumbai, was presented around its fifth anniversary as a Shariah-compliant credit cooperative started on 15 March 2010. At that time it counted 23 branches in 12 states and about 16,000 members, with paid-up capital of around Rs 4 crore. It is registered under the Multi-State Co-operative Societies Act, 2002, and offers savings, loans, a Hajj fund, a children’s education fund and a self-help group fund.
In November 2017 its director, Liyaqat Ali Khan, said the society began with Rs 191,000 and reached revenue of Rs 224 crore in 2016. He also mentioned a gold medal at the Islamic Finance Forum of South Asia in Colombo and said that non-Muslims use its services. Janseva is also listed among Islamic finance institutions as a Mumbai cooperative with a social-purpose model.
These figures are the society’s own statements, not audited accounts, and it is wise to deal only with a branch or office you have visited in person. Anyone thinking of joining should ask for the registration certificate, the current by-laws and the latest balance sheet at a branch. Before paying anything to a Mumbai cooperative, ask the Registrar of Cooperative Societies, or the Central Registrar for a multi-state society, to confirm in writing that the society is registered and in good standing.
Baitun Nasr and Baitulmal, past and present
Mumbai has an older story of interest-free societies. Bait-Un-Nas’r Urban Co-operative Credit Society is described as operating without interest, founded on 1 October 1976 under registration BOM/RSR/786 of 1976. An interview in Down To Earth has called past attempts of this kind more like clubs than cooperatives, and an older study of interest-free institutions lists the society as collapsed.
Whether the society works today is something only the society and its registrar can say, so ask for its current registration status. The same study lists AICMEU’s Baitulmal Cooperative Credit Society in Mumbai, incorporated in 1984 and with more than 15,000 members at the time of that study. That study is old, so ask the society for its current status before relying on it.
Barkat Leasing and Financial Services, registered in 1991, also appears in the study as a Mumbai firm that collapsed. The lesson for a saver is that a name suggesting trust says nothing about solvency. Ask whether the entity is registered, who audits it and whether deposits are insured or guaranteed by any law, and be careful with any scheme that promises a fixed monthly return.
Maulana Azad Minorities Financial Development Corporation
The state’s own lender for minorities is the Maulana Azad Minorities Financial Development Corporation Limited, founded in 2000. It provides loans to minority communities.
At a review held by the minority affairs minister on 30 April 2025, loans of up to Rs 30 lakh were described, with a borrower contribution of 5 per cent. The loan guarantee was raised from Rs 30 crore to Rs 500 crore in the 2024-25 budget, and skill development and housing initiatives were cited. Ask the corporation for its current limits and terms in writing. A borrower who wants to avoid interest should ask the corporation, in writing, whether the loan carries a rate or a service charge, and should keep the sanction letter for a scholar to read.
Nothing indicates that its loans are interest free. A Muslim borrower who wants to avoid interest should request the written terms and take them to a scholar. The six notified communities may use such schemes: Muslims, Christians, Sikhs, Buddhists, Parsis and Jains.
Maharashtra State Board of Waqf in Mumbai
The statutory endowment body calls itself the Maharashtra State Board of Waqf, and its address is Mantralaya, Mumbai. The board maintains a history of itself, a list of properties, a gazette, a Qazat section, right-to-information material and a citizens charter. A reply in the Lok Sabha reports 81 encroached waqf properties in the state.
A waqf is a permanent dedication of an asset whose income serves a charitable purpose, such as a mosque, a school or a hostel. The board registers waqf property and oversees its management; it does not lend to individuals. Families who want to create a waqf should consult the board and a lawyer.
The board’s work extends beyond property, as its range of sections shows. For any financial question, such as the rent from a waqf shop or the funding of a scholarship, ask for the board’s written order and a copy of the deed.
Cooperative law, the registrar in Pune and Sahulat’s local units
Cooperative societies in the state come under the Commissionerate of Cooperatives and Registrar of Cooperative Societies in Pune, under the Department of Cooperation, Marketing and Textiles. The governing statute is the Maharashtra Cooperative Societies Act, 1960, with Rules framed in 1961, and the same office also administers the Bombay Money-Lenders Act, 1946. In February 2025 the office counted more than 2.18 lakh cooperative societies.
A society that operates across states, as Janseva does, is registered by the Central Registrar. A purely Maharashtra society goes through the state registrar. Founders of a new interest-free group need to decide early which route applies, because it determines who audits them and who hears complaints.
The Sahulat microfinance network lists about 19 affiliates in Maharashtra, the most of any state, with Rahat in Nanded and Osmanabad as examples. Check each affiliate directly for its loan products and whether it is currently active before relying on it.
Islamic finance in Maharashtra: crowdfunding, zakat and caution
Online campaigns in Mumbai, Pune and Nagpur follow the national pattern. A donation-based appeal returns nothing to the giver, a reward-based one returns a perk, a lending-based one promises repayment and an equity-based one offers shares. Campaigners need Aadhaar, PAN, address proof and a bank account, and payment normally arrives by UPI, cards or net banking.
Zakat is 2.5 per cent of qualifying wealth held for a lunar year above the nisab threshold, and the Quran names eight categories of recipients. Many givers use mosque committees, trusts and national organisations. A charity needs a valid 80G approval for a tax deduction, and a receipt that shows its details.
A large market also attracts fraud. Report online scams on helpline 1930 or the National Cyber Crime Reporting Portal, report unauthorised deposit schemes on the RBI Sachet portal and take complaints against banks to the RBI Integrated Ombudsman Scheme. Decisions on whether a product is permitted belong to qualified scholars or a Sharia board.