The growth of microfinance instruments has allowed millions of poor people around the world to receive small loans without collaterals and proof of their credibility, which would not be possible in the conventional financial institution. With the increasing number of refugees and displaced people in the MENA regions, a need for the Islamic microfinance products has notably grown. However, current Islamic banks rarely provide financial services to the poor. Accordingly, there is an urgent need to develop alternative financial instruments to respond to needs of the poor populations in the Middle East and to enhance the development of entrepreneurship in the region, which might contribute to the overall poverty alleviation. Within this paper a Shariah-compliant crowdfunding platform is elaborated and discussed in details. The study was conducted by using qualitative analysis of the secondary data. The results showed that crowdfunding instruments can be employed in different models, whereas one of the most compliant in terms of Islamic finance principles is investment-based with equity sharing method. Therefore, the paper proposes that the musharakah crowdfunding model in form of equity represents an effective alternative method for financing entrepreneurial activities and micro-enterprises, whereby overcoming the funding gap and potential risk expected by financial institutions and aiming at poverty reduction in the long term.