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Article
Publication date: 29 January 2020

Nurudeen Abubakar Zauro, Nurudeen Abubakar Zauro, Ram Al Jaffri Saad and Norfaiezah Sawandi

The purpose of this paper is to discuss the roles of Zakat, Sadaqah and Qardhul Hassan within the context of the existing literature as major Islamic financial instruments…

Abstract

Purpose

The purpose of this paper is to discuss the roles of Zakat, Sadaqah and Qardhul Hassan within the context of the existing literature as major Islamic financial instruments for enhancing socio-economic justice amongst Muslims haves and have-nots as these enhance financial inclusion in Nigeria.

Design/methodology/approach

The discussion in this paper is based on secondary sources such as the divine knowledge contained in the Qur’an, Hadiths and the existing literature, such as previously conducted empirical studies and Islamic world view (Tawhidi epistemology).

Findings

This paper implores Islamic societies to use Zakat, Sadaqah and Qardhul Hassan as instruments that encourages wealth redistribution that promotes efficient and effective wealth redistribution between haves and have-nots as part of the vicegerent (khaliphah) role between mortal being (human) and his immortal creator (Allah). This paper concludes by suggesting the use of these Islamic financial instruments as means to enhance socio-economic justice and financial inclusion in the Nigeria’s Muslims’ communities that are negatively affected by the high rate of financial exclusion and poverty as had been previously practiced in the Muslim world throughout the Islamic history.

Research limitations/implications

This paper provides critical suggestions on the ways Zakat, Sadaqah and Qardhul Hassan will contribute significantly towards assisting Nigeria in achieving its vision of reducing the financial exclusion rate that is currently put at 41.6% to 20% by the year 2020 and may foster inclusive growth and sustainable development. However, the limitation is that it is a mare conceptual study, and the future researchers may subject it to the scientific test to offer empirical evidence regarding the roles of Zakat, Sadaqah and Qardhul Hassan towards closing the gap of financial exclusion in Nigeria.

Originality/value

This paper contributes to the existing literature on the doctrine of the Islamic moral economy by recommending the adoption of Islamic financial instruments as tools for enhancing income redistribution and financial inclusion.

Details

Journal of Islamic Accounting and Business Research, vol. 11 no. 3
Type: Research Article
ISSN: 1759-0817

Keywords

Content available
Article
Publication date: 4 August 2020

Mohammad Abdullah

This paper aims to analyse the Sharīʿah premises of waqf (Islamic endowment), followed by dilating on the nature of argumentation among the classical jurists on its rules…

Abstract

Purpose

This paper aims to analyse the Sharīʿah premises of waqf (Islamic endowment), followed by dilating on the nature of argumentation among the classical jurists on its rules and principles. The paper critically analyses the edifice of the applied juristic analogy of different early jurists in deriving various waqf doctrines. The objective of analysing the jurisprudential framework of waqf in its classical mould is to conceptualise the methods, mechanism and nature of juristic analogies in deriving the waqf principles. This analysis is critical to understand the scope of jurisprudential flexibility in modern awqāf.

Design/methodology/approach

The paper is an outcome of a library-based research. It uses the classical jurisprudential treatises of waqf with an aim to analyse the Sharīʿah basis of the institution, the premises of its key principles and the applied juristic analogy to derive the same. The paper covers the classical waqf books and treatises from the four Sunni schools of jurisprudence and uses a textual analysis method.

Findings

The paper finds that in its initial phase, the conceptual framework of waqf was not unanimously agreed by all jurists, rather its Sharīʿah permissibility remained critically disputed among them for a while. Though, the opinion of those jurists who approved the Sharīʿah-validity of waqf was to prevail in the later stage, disagreement persisted with reference to its necessary features and defining criteria. It is found that in the classical waqf literature, two most disputed aspects of waqf jurisprudence constituted the requirements for completion of a waqf and its ownership status.

Research limitations/implications

This study neither covers the historical contribution of waqf among the Muslim societies nor touches on the empirical aspects of modern waqf. Rather, the focus of the study is limited to analysing the classical jurisprudential discourse of waqf and distillation process of its rulings.

Practical implications

The objective of analysing the classical juristic discourse of waqf is to underline the premises of classical juristic analogy in determining the framework of fiqh al-awqāf (jurisprudence of waqf) in its classical permutations and to learn how to adopt a similar approach for deduction of new waqf rulings.

Originality/value

This paper adds original value to the body of waqf literature for analysing the classical waqf rulings distillation process along with examining the methods and mechanism of juristic analogy.

Details

ISRA International Journal of Islamic Finance, vol. 12 no. 2
Type: Research Article
ISSN: 0128-1976

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Article
Publication date: 28 July 2021

Abdullah A. Shuaib and M. Sohail

This study aims to examine the role of Islamic social finance (ISF) instruments such as Zakah, Sadaqah and Waqf in the provision of social services by Islamic faith-based…

Abstract

Purpose

This study aims to examine the role of Islamic social finance (ISF) instruments such as Zakah, Sadaqah and Waqf in the provision of social services by Islamic faith-based organizations (IFBOs) in Southwest Nigeria.

Design/methodology/approach

This study adopts exploratory approach based on field interviews conducted with leaders of IFBOs, whereas purposive sampling technique was used to select three case study organizations. Data collected from interviews and documents of case study organizations was analyzed using content and narrative analyses.

Findings

The first findings indicate faith in the Unseen God, scriptural texts and socio-economic factors as major motivation that accounted for the IFBOs’ concern for social services. The second finding shows that the ISF strategies used by the IFBOs to improve access to social services include Zakah, Awqaf, Sadaqah and gifts. The third finding reveals that the IFBOs have efficient stand-alone and windows operational structures that align with IFBOs corporate governance. The fourth finding also reveals the challenges facing the IFBOs such as inadequate funding, dearth of manpower, lukewarm and uncooperative attitude of Muslims and attitudinal behaviour of givers and takers.

Research limitations/implications

Absence of documented directory about the role IFBOs usage of ISF in providing social services in Southwest Nigeria affected the study. Many IFBOs were eliminated during the process of selection because of lack of records to indicate their social services relevant to the study. As such, information that could have been collected from the eliminated IFBOs could have contributed significantly to the study.

Practical implications

The major implications of the study are that ISF has been reinvented as an ethical social welfare framework for supporting the disadvantaged members of the society with ISF instruments and also highlighted the dichotomy existing between IFBOs in the North and Southwest Nigeria with respect to the legal and operational activities of IFBOs usage of ISF.

Originality/value

This study has contributed to a better understanding of the role of ISF instruments in the provision of social services in an area that is largely under-researched in Nigeria.

Details

International Journal of Islamic and Middle Eastern Finance and Management, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1753-8394

Keywords

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Article
Publication date: 13 June 2016

M. Nusrate Aziz and Osman Bin Mohamad

The purpose of this paper is to identify some well-set instruments in Islam that can efficiently alleviate poverty, solve social problems and reduce social inequality…

Abstract

Purpose

The purpose of this paper is to identify some well-set instruments in Islam that can efficiently alleviate poverty, solve social problems and reduce social inequality through a new operational framework called “Islamic social business (ISB)”.

Design/methodology/approach

This is a conceptual research that is based on Al-Quranic principles as well as contemporary social welfare philosophies, such as, augmented stakeholder theory, social enterprise and social business. Al-Quran, Al-Hadith and existing traditional and Islamic literature are consulted for this study.

Findings

The study proposes an efficient system of Islamic wealth sourcing and management to make the process of poverty alleviation sustainable. Other social problems for disadvantaged people, such as, health-, shelter-, literacy- and environmental-related issues are also addressed in the proposed system. The study identifies the inefficiency in the current practices and makes some propositions that are in conformance with Islamic principles and implementable by Islamic institutions all over the world. The authors propose a theoretical framework and operational propositions for ISB.

Practical implications

In following this study, social policymakers, Islamic financial institutions, Islamic social enterprises and Islamic charity organizations will find organized guidelines to initiate “new entities” or “reshape existing entities”.

Social implications

The study will be effective in solving social problems, alleviating poverty and reducing social inequality.

Originality/value

This is the first study that identifies all the potential Islamic sources of funding and the efficient management thereof through ISB. The study also proposes an ISB model and makes several propositions for different types of ISB.

Details

International Journal of Social Economics, vol. 43 no. 6
Type: Research Article
ISSN: 0306-8293

Keywords

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Article
Publication date: 25 May 2010

L. Raimi, M.A. Bello and H. Mobolaji

The purpose of this paper is to examine the appropriateness of faith‐based model (FBM) as a veritable policy response to the issue of poverty alleviation and actualisation…

Abstract

Purpose

The purpose of this paper is to examine the appropriateness of faith‐based model (FBM) as a veritable policy response to the issue of poverty alleviation and actualisation of the millennium development goals (MDGs) in Nigeria.

Design/methodology/approach

The paper combined qualitative and quantitative date to validate the appropriateness of FBM, to tackling poverty issues in Nigeria. The first section presents a brief introduction on poverty issue in Nigeria. The second section outlines the theoretical and methological approaches adopted in the paper. The third section casts a cursory look at the conceptualisation of poverty in the literature. The fourth section explores poverty‐eradication efforts in Nigeria. The fifth section highlights the failure of previous poverty reduction strategies (PRS) in Nigeria. The sixth section presents a background to MDGs. The seventh section show‐cases application of Islamic economics models (faith‐based model and business system model (BSM)) to MDGs. The eighth section is devoted to data projections, analysis and interpretation. The final section concludes with policy prescriptions.

Findings

On the basis of projection which is hinged on Shari'ah assumptions (minimum zakatable wealth and 2.5 per cent Zakat rate), the paper shows that Zakat and Sadaqat collections from year 2009 to 2015 would amount to N357,038 billions and N31 billion, respectively. These funds would go a long way in helping to alleviate poverty and actualisation of MDGs in Nigeria.

Practical implications

The faith‐based poverty reduction strategy enriched by BSM as conceptualised in this study can be used to eradicate extreme poverty and hunger (MDG 1), achieve universal primary education (MDG 2), promote gender equality and empower women (MDG 3), reduce child mortality (MDG 4), improve maternal health (MDG 5), combat, HIV/AIDS, malaria and other diseases (MDGs 6), ensure environmental sustainability (MDG 7) and develop a global partnership for development (MDG 8).

Originality/value

The results of this paper support the Islamic economics view that Zakat and Sadaqat are viable fiscal mechanisms for poverty alleviation where adopted. The FBM as conceptualised in this paper would therefore complement and pose a positive challenge to contemporary PRS in use in many poverty‐ridden nations where economic indicators have justified prevalence of poverty, despite the various PRS put in place by policy makers.

Details

Humanomics, vol. 26 no. 2
Type: Research Article
ISSN: 0828-8666

Keywords

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Article
Publication date: 8 January 2021

Fahmi Ali Hudaefi and Irfan Syauqi Beik

Despite the COVID-19 recession, the collection of zakat (almsgiving) managed by the National Board of Zakat Republic of Indonesia (BAZNAS RI) has increased, especially…

Abstract

Purpose

Despite the COVID-19 recession, the collection of zakat (almsgiving) managed by the National Board of Zakat Republic of Indonesia (BAZNAS RI) has increased, especially during Ramaḍān 1441 Hijra. Previous works show a positive relationship between digital zakat campaign and zakat collection. This paper aims to study the means of digital zakat campaign during COVID-19 outbreak. This topic is theoretically and practically important in the emerging debate of Islamic marketing, notably in Islamic social finance field.

Design/methodology/approach

This paper uses a qualitative research approach. A case study is engaged in the selection of BAZNAS RI for a detailed discussion of a zakat organisation. Meanwhile, a netnographic approach is used to analyse the number of 549 posts from BAZNAS RI’s social media, which are Facebook, Instagram, Twitter and YouTube. Furthermore, a qualitative software analysis of NVivo 12 Plus is used in performing the analytical procedures.

Findings

This work explains the means of digital zakat campaign during COVID-19 outbreak with a case of BAZNAS RI. It is identified the number of 6 parent nodes and 64 child nodes from the analysis using NVivo 12 Plus. The authors’ parent nodes are “donation”, “infaq” (Islamic spending for charities), “Ramaḍān matters”, “ṣadaqah” (voluntary charity), “virtual events” and “zakat”. These nodes detail digital campaign of BAZNAS RI posted in its social media during COVID-19 period in Ramaḍān. A theoretical implication of inclusive marketing is derived from the analysis. It explains that the inclusiveness of digital contents is practically significant in campaigning zakat as a religious obligation that contributes to social and financial benefits.

Research limitations/implications

This paper does not claim a positivist perspective on the relationship between digital zakat campaign and zakat collection. Instead, this paper explores in-depth the practice of digital zakat campaign, which the previous study confirms its association with a muzakki’s (Muslims who are obliged to pay zakat) decision to pay zakat.

Practical implications

This paper establishes the Islamic marketing theory that is derived from industrial practices. The inclusiveness of digital contents in zakat campaign is critical in activating zakat as a religious obligation that authentically shapes the social and economic processes of a Muslim community. This theory is practically important for 'amils (employees) of zakat institution who work in the marketing division, chiefly to create such contents to post in social media.

Social implications

The authors’ node of zakat distribution for COVID-19 relief indicates the importance of a formalised zakat institution to actualise zakat’s role in handling socioeconomic problems. Thus, paying zakat formally in an authorised organisation may contribute to a greater social contribution and maṣlaḥah (public interest) than paying it informally without any effective measurement.

Originality/value

This study contributes to the novelty in the Islamic marketing debate within two folds. First, this paper is among the pioneers in studying digital zakat campaign during COVID-19 outbreak by using a netnographic approach. Therefore, a theoretical implication derived from industrial practices is contributed. Second, this paper details the steps in using NVivo 12 Plus to analyse the unstructured data sampled from the internet. The future studies may thus refer to this work to understand the application of netnography and the procedures in analysing data from social media using this software.

Details

Journal of Islamic Marketing, vol. 12 no. 3
Type: Research Article
ISSN: 1759-0833

Keywords

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Article
Publication date: 18 January 2021

Khurram Parvez Raja

The Sharīʿah Standard No. (35) issued by the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) aims to identify the zakāt base for…

Abstract

Purpose

The Sharīʿah Standard No. (35) issued by the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) aims to identify the zakāt base for institutions (including Islamic insurance companies) as well as the subsidiary and the mother company of the institution (the company). By zakāt base, the standard means the items of financial statements that should or should not be included in the calculation of the zakāt base, and the liabilities or allocations that should or should not be deducted from zakatable assets. The standard also covers payable zakāt rates, disbursement of zakāt funds on the eight categories of zakāt recipients and the rulings pertaining to disbursement. The focus then is on companies or corporations. There is no indication in the aims as to who owns the wealth of the corporation, that is, whether it is the company itself or it is the shareholders and whether it is treated as a joint wealth of the shareholders or of a single individual in the form of the company. The author will rely on this issue as one factor on the basis of which the standard is to be judged.

Design/methodology/approach

Quran and hadith. Works of earlier jurists.

Findings

In this study, the author has summarized the provisions of zakāt according to the traditional law, but only those that are relevant for the financial institutions and the standard issued by the AAOIFI. After that, the author mentioned the major points that have been addressed by the standard. In the last section, the author has shown that the rulings of the Islamic Fiqh Academy and the AAOIFI on zakāt are totally confusing and merely a reproduction of the rulings of traditional law. The main reason for this confusion is that the nature and entity of a corporation have not been addressed and have been treated like a partnership, thus, jumbling up the entire issue of zakāt through banks.

Originality/value

The main purpose in undertaking this original work is to examine the AAOIFI Sharīʿah Standards from the perspective of traditional Islamic law, that is, the law of the senior schools as laid down in their authentic manuals. If there is an extensive deviation from this law, then this must be pointed out in the hope that it will be corrected by the concerned institution and the banks that adopt these standards. Neglecting such a corrective action for long will result in damage not only to these institutions in the long run but also to the law of Islam that has been so carefully crafted over centuries. The purpose is to show how far this standard deviates from traditional Islamic law and claims to be called the authentic view on a particular subject. Nevertheless, it is not the purpose of this work to explain and elaborate on the meaning and utility of these standards.

Details

Journal of Money Laundering Control, vol. 24 no. 2
Type: Research Article
ISSN: 1368-5201

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Article
Publication date: 15 June 2015

Mohammad Abdullah

This paper aims to explore the moral aspect of qard (loan) from shariah perspective, and attempts to examine whether each interest-free qard is qualified for the Quranic…

Abstract

Purpose

This paper aims to explore the moral aspect of qard (loan) from shariah perspective, and attempts to examine whether each interest-free qard is qualified for the Quranic term qard hasan (loan par excellence)? Also, the study attempts to establish the key constituents of qard hasan in the light of the primary sources of shariah, and seeks to define the legal status of the interest-free qard which fails to qualify for the “term” qard hasan.

Design/methodology/approach

This study uses both the primary and secondary sources of shariah to examine the desired character of qard hasan. It employs pure qualitative paradigm to analyse and interpret the data.

Findings

This study finds that in between the qard hasan and qard ribawi, there exists a third category of qard too, which neither qualifies for the former nor does fit under the definition of later.

Originality/value

The findings presented in this paper illuminate the blurred line of contemporary understanding of qard hasan. The study adds original value to the corpus of contemporary literature on qard; as it collects and enumerates the ten vital conditions of qard hasan, without which, even an interest-free qard holds no virtuous sanctity in the sight of shariah.

Details

International Journal of Islamic and Middle Eastern Finance and Management, vol. 8 no. 2
Type: Research Article
ISSN: 1753-8394

Keywords

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Article
Publication date: 22 June 2021

Fahmi Ali Hudaefi, Rezzy Eko Caraka and Hairunnizam Wahid

Zakat during the COVID-19 outbreak has played a vital role and has been significantly discussed in the virtual environment. Such information about zakat in the virtual…

Abstract

Purpose

Zakat during the COVID-19 outbreak has played a vital role and has been significantly discussed in the virtual environment. Such information about zakat in the virtual world creates unstructured data, which contains important information and knowledge. This paper aims to discover knowledge related to zakat administration during the pandemic from the information in a virtual environment. Furthermore, the discussion is contextualised to the socio-economic debates.

Design/methodology/approach

This is a qualitative study operated via text mining to discover knowledge of zakat administration during the COVID-19 pandemic. The National Board of Zakat Republic of Indonesia (BAZNAS RI) is selected for a single case study. This paper samples BAZNAS RI’s situation report on COVID-19 from its virtual website. The data consists of 40 digital pages containing 19,812 characters, 3,004 words and 3,003 white spaces. The text mining analytical steps are performed via RStudio. The following R packages, networkD3, igraph, ggraph and ggplot2 are used to run the Latent Dirichlet Allocation (LDA) for topic modelling.

Findings

The machine learning analysis via RStudio results in the 16 topics associated with the 3 primary topics (i.e. Education, Sadaqah and Health Services). The topic modelling discovers knowledge about BAZNAS RI’s assistance for COVID-19 relief, which may help the readers understand zakat administration in times of the pandemic from BAZNAS RI’s virtual website. This finding may draw the theory of socio-economic zakat, which explains that zakat as a religious obligation plays a critical role in shaping a Muslim community's social and economic processes, notably during the unprecedented times of COVID-19.

Research limitations/implications

This study uses data from a single zakat institution. Thus, the generalisation of the finding is limited to the sampled institution.

Practical implications

This research is both theoretically and practically important for academics and industry professionals. This paper contributes to the novelty in performing text mining via R in gaining knowledge about the recent zakat administration from a virtual website. The finding of this study (i.e. the topic modelling) is practically essential for zakat stakeholders to understand the contribution of zakat in managing the COVID-19 impacts.

Social implications

This work derives a theory of “socio-economic zakat” that explains the importance of a zakat institution in activating zakat for managing socio-economic issues during the pandemic. Thus, paying zakat to an authorised institution may actualise more maslahah (public interest) compared to paying it directly to the asnaf (zakat beneficiaries) without any measurement

Originality/value

This study is among the pioneers in gaining knowledge from Indonesia’s zakat management during the COVID-19 outbreak via text mining. The authors’ way of analysing data from the virtual website using RStudio can advance Islamic economics literature.

Details

International Journal of Islamic and Middle Eastern Finance and Management, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1753-8394

Keywords

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Book part
Publication date: 19 November 2018

Noor Ain Alin @ Nordin and Asmak Ab Rahman

Purpose – The purpose of this chapter is to study the concept of infaq in Islam, investigate its practice in Malaysia, analyse its role in public universities (PUs)…

Abstract

Purpose – The purpose of this chapter is to study the concept of infaq in Islam, investigate its practice in Malaysia, analyse its role in public universities (PUs), investigate the issues and constraints of infaq for financing of higher education in Malaysia and suggest recommendations for improvement.

Methodology/approach – This study used a qualitative methodology and was conducted to obtain information on the practice of infaq in financing tertiary-level education in Malaysia, to learn about the recommended practice of infaq in Islam, to analyse its implementation and to explore the constraints faced in the financing of higher education in Malaysia.

Findings – This study indicated that the practice of infaq helps to ease the burden of rising fees and the cost of living for university students.

Research limitations/implications – The study only focused on the role of infaq in financing higher education in Malaysia. The sample for this study involved four PUs in the Klang Valley.

Originality/value – This study provides new contributions to the field of education infaq in Malaysia.

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