This paper aims at exploring the administrative challenges of waqf as a prominent mechanism of poverty alleviation and provision of social welfare services. Waqf is generally regarded to be one of the most effective ways of expressing philanthropy for sustaining the welfare of the needy, the poor, the family, and the society. Through this philanthropic institution, wealth is transferred from private ownership to public utility. Personal assets of useful value can be endowed in waqf for the all-round services of the society; religious, social, economic, and educational sectors, under certain conditions and regulations laid down by the Sharīʻah. Right from the time of the Holy Prophet, waqf has been benefitting people and defraying public expenses as it served as an effective means of funding mosques, graveyards, orphanages, schools, hospitals, bakeries, warehouses, mills, and numerous humanitarian or religious foundations. Similarly, this institution was successfully financing agriculture, horticulture and water resources during the previous centuries, as it was used to cater for the aged, infirm, destitute, and even animals. However, with the advent of colonialism in the Islamic world and subsequent negative transformation of Islamic culture and tradition, this strategic financial institution eventually started to turn into a shadow of its former glorious status. By adopting the narrative approach of qualitative research method, this study analyses the current administrative problems facing waqf institution in a bid to finding their lasting solutions and resuscitating its humanitarian functions.
The paper provides an insight for assessing risk management frameworks for implementation by the Islamic banks. Considering the dynamic nature of ever-increasing internal and external forces from which diverse banking risks are emanating, it becomes imperative to continue updating the risk management mechanisms. This is absolutely necessary in order to ensure full compliance with the relevant Sharī`ah principles, strengthen depositors' protection, engender consumer confidence, minimize the impact of failure, improve quality of services, reduce costs of operation, provide greater competitive advantage, create new markets for investments, and attract more customers. Although the risk management mechanisms cannot be generalized because Islamic financial institutions are not the same in their operational activities, sizes, personnel and sophistication, but the frameworks outlined in this paper can provide useful clues for effective and comprehensive risk management and mitigation.
Islamic hedging is one of the most important tools for risk management. Currency options contracts are commonly regarded as one of the useful tools of risk management and frequently used to reduce risk associated with the movement in price and currency risk. This article attempts to review the suitability of the Islamic currency options in one of the Islamic banks in Malaysia as a hedging mechanism and highlights Shariah issues pertaining to the structures. Currency options are prohibited in Islamic finance due to the issue of riba and to the violation of the bay al-sarf rule which requires currency trading to be done on “spot” basis only. Options contract is also rejected by some scholars because of premium payment or chargeable fees to the right. In view of the overwhelming importance of currency risk management in the volatile market, the application of Shariah principles in currency market faces a great challenge to Islamic scholars today. Based on the observation of the bank’s official information disclosed to the public and the interview conducted, the finding of this research indicates that the bank permitted currency options based on the principle of tawwaruq (commodity murabahah) or bay al-inah and wa’ad (unilateral promise) which are strictly used for hedging purposes. Tawwaruq and wa’ad principles have given Islamic financial institutions the opportunity to structure Shariah compliant financial products and meet the objective of increasing trading volume and liquidity in order to reduce transaction cost and risk. Keywords: Islamic hedging, options, currency trading, tawarruq, wa’ad.
There are several methods that can be utilized to enhance the productivity of endowment (waqf) assets. These assets can be rented out to interested parties or used for various economic activities such as agriculture and livestock farming. In cases where the above methods are deemed unsuitable, then the Nazir should try to find other alternatives to make the waqf land productive. Endowment (waqf) trustees should also explore other avenues to optimize the usage of endowment land under their care. The establishment of waqf institution in UUM should be develop as alternatives in order to prosper the human capital (students) in their education by using the cash waqf. Cash waqf is a trust fund established with money to support services for mankind’s benefits in the name of Allah. Generally cash waqf has tremendous potential for the development of the human capital because it is liquid assets compared to traditional endowment in the form of fixed assets such as land and buildings. On the other hand the traditional endowment can only be done by rich people. In contrast to the cash waqf which can be implemented by each individual even with a few amounts. However, the acceptance of cash waqf shall be placed under an institution called The Waqf Institutions. Hence the establishment of the institution of waqf in UUM shall be established so that they can help the needy students in financing their education in UUM. This research explores the factors that influence the acceptance of waqf institutions establishment in Universiti Utara Malaysia. Considering the importance of cash waqf in developing waqf institutions and enhances the social economic of ummah. The objective of this paper is to explore the acceptance towards waqf Institution establishment in UUM. The methodology of this research is a quantitative research towards 379 respondents among Muslim students in UUM. All the data are analysed using software of Statistical Package for Social Science (SPSS) by conducting statistical method namely, Independent Samples T-test, Analysis of Variance (ANOVA), Pearson Corellation and Multiple Linear Regression analysis to achieve the objectives of this research. A conceptual framework is built based on Theory Planned Behaviour (TPB) and Technology Acceptance Model (TAM).
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