Imam Sadiq University "Islamic Finance Research" (IFR) 2251-8290 10 2 2021 04 21 Designing a New Model of Islamic Micro-Financing in Iranian Banking System (Based on Mandate, Qarz al-Hasan and Murabaha Contract) Designing a New Model of Islamic Micro-Financing in Iranian Banking System (Based on Mandate, Qarz al-Hasan and Murabaha Contract) 539 572 75883 10.30497/ifr.2021.240367.1598 FA Wahab Qelich Assistant Professor, Monetary and Banking Research Institute, Central Bank of the Islamic Republic of Iran 0000-0003-1512-7322 Mandana Taheri  Assistant Professor, Allameh Tabatabaei University, Tehran, Iran 0000-0001-7741-7208 Journal Article 2021 01 24 In recent decades, micro-financing institution has been proposed in many countries as a suitable solution for increasing entrepreneurship and job creation and improving the welfare of poor and moderate households. Due to the deficiency of microfinance instruments appropriate for low and average income groups of the society in the Iranian banking system, the targeted provision of these services has failed to achieve its goals. Hence, it is necessary to design new methods for financing these social groups, so that while efficient, they keep in line with the goals and functions of Iranian banking. This paper has designed and presented a new model for microfinance in the Iranian banking system by using a descriptive- exploratory method and experts' points of view. The proposed model is based on attracting deposits through special contract of mandate and payment of facilities using <em>Qarz al-Hasan</em> and <em>Murabaha</em> contracts with the aim of financing the weak and middle classes of the society. In recent decades, micro-financing institution has been proposed in many countries as a suitable solution for increasing entrepreneurship and job creation and improving the welfare of poor and moderate households. Due to the deficiency of microfinance instruments appropriate for low and average income groups of the society in the Iranian banking system, the targeted provision of these services has failed to achieve its goals. Hence, it is necessary to design new methods for financing these social groups, so that while efficient, they keep in line with the goals and functions of Iranian banking. This paper has designed and presented a new model for microfinance in the Iranian banking system by using a descriptive- exploratory method and experts' points of view. The proposed model is based on attracting deposits through special contract of mandate and payment of facilities using <em>Qarz al-Hasan</em> and <em>Murabaha</em> contracts with the aim of financing the weak and middle classes of the society. https://ifr.isu.ac.ir/article_75883_ddb2043aa4edefcb923ef5af3c373dea.pdf