World zakat funds have not been effective in reducing poverty in populated Muslim countries.
The issue was addressed at the World Forum on Zakat Conference in Bandung, West Java, earlier this week.
"Twenty-four of the 57 members of the Organization of Islamic Cooperation (OIC) need humanitarian assistance because of conflict and displacement," said Sikander Khan, director of the relief center UNICEF emergency, Thursday.
A study by the World Bank and the Islamic Research and Training Institute (IRTI) of the Islamic Development Bank (IDB) estimates that global funds for zakat are worth $ 550 to $ 600 billion a year. Meanwhile, official zakat institutions managed only $ 10-15 billion a year.
Khan stated that this amount was not well managed and used strategically through empowerment programs.
Muslims in some countries still live below the poverty line. They are affected by conflict and have had to live in refugee camps.
He said that the OIC had awakened its call to plan strategic actions to maximize the considerable potential of zakat for Muslims in need of humanitarian assistance.
Zakat's contribution to reducing poverty and improving the well-being of the Muslim population has become a recurring issue that is being discussed at the World Zakat Forum (WZF). ), a forum involving zakat institutions from 33 countries.
"No global data has shown how much the Zakat fund has helped to help the Muslim population," added WZF executive secretary Irfan Syauqi Beik.
A concerted effort is needed to improve the management of zakat so that it can function optimally. In addition, the global Muslim population does not understand that zakat can play a role in community empowerment in the long run.
There are still Muslims who choose to pay zakat directly, without going through long-term management and empowerment programs.
Second, not all Muslim countries have qualified Zakat management institutions. Thirdly, not all countries with Muslim populations have zakat laws.
"Only a third of the WZF member countries have zakat laws," said Irfan.
However, in several countries – such as Indonesia and Malaysia – Irfan said the zakat distribution is very effective in improving the standard of living of the beneficiaries.
"In fact, many people do not have the capacity to judge whether the recipient has the right to receive a zakat," he said.
To increase the contribution of zakat, the WZF called on members to become more involved in empowerment programs by collaborating with humanitarian agencies such as the United Nations Children's Fund (UNICEF). ) and the United Nations Development Program (UNDP).
The WZF signed a Memorandum of Understanding with two agencies regarding the use of zakat funds in the fight against poverty, as one of its Sustainable Development Goals (SDGs).
For example, zakat funds were used to build renewable energy plants for 803 households in four villages in Jambi, Indonesia.
The project benefited nearly 5,000 people in 2017 and is able to boost economic development and community productivity.
The WZF hopes that SDG member countries will be able to replicate similar programs, not only in the economic field, but also in the areas of education, stunting prevention and others.
The WZF believes that the use of digital technology is one way to optimize zakat management to reach the right target. In its resolution, the WZF asked all member countries to use the latest technology in zakat management.
The Zakat Foundation of India is one of the institutions that has used technology for mapping the collection and distribution of alms.
"Nobody comes to our office to pay Zakat, they are all paid numerically," said Mahmud.
He said that digital technology increases the transparency of the reception and distribution of zakat.
"Every afternoon, I get a report from zakat via a smartphone," said Mahmud.
"Transparency can strengthen people's trust, so they want to distribute their zakat through us," he added.
Meanwhile, in Indonesia, Baznas has collaborated with several digital financial platforms for payment in zakat.
Baznas said that digital channels will account for 30% of the total zakat collection in 2020, while the trend of zakat digital distribution continues to increase.
The problem, however, is not that the Muslim population of the world does not master technology well. The digitization of zakat is therefore not entirely relevant to implement.
Azara Abubakari-Haroun, Zakat's acting administrator, Sadaqat, of the Ghana Trust Fund, said that 70 percent of Ghana's 5 million Muslim inhabitants were illiterate and lived in poverty.
"It's a problem, if 70% of Muslims are still illiterate, how to digitize the economy?" she said.
Azara realized that the digitization of zakat had to operate in a context of rapid world development, adding that the Zakat institution in Ghana was working on a zakat payment plan through automatic payroll deduction.
"(Eighty) percent of the 1.5 million Muslim inhabitants who are eligible to pay zakaah are interested in this method," she said.
With regard to this situation, the WZF stated that it would facilitate education and increase the capacity of the resources in the countries needing assistance to develop the digitization of zakat.
"Africa is one of our concerns.We will strengthen education and increase the capacity of resources in countries that need help, it is the most important. essence of the WZF, "said Beik.
* Maria Elisa Hospita and Rhany Chairunissa Rufinaldo contributed to the story.
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