Adoption of ZakaTech in the time of COVID-19: cross-country and gender differences

Abstract

Purpose Despite the significant growth in Islamic economies and the increasing number of Muslim youths inclining digital services, empirical-based research addressing the adoption of digital Islamic services is still limited. ZakaTech is a new phrase that has recently emerged as a modern term describing novel technologies adopted by zakat institutions; yet, it has been largely neglected in the literature. Therefore, this study aims to provide an integrated model that scrutinizes the determinants of acceptance and use of technology (UTAUT) of ZakaTech, combined with social cognitive theory (SCT), in the midst of the COVID-19 crisis where social distancing is the norm in conducting economic activities. Design/methodology/approach Based on cross-national evidence from two Muslim-majority countries, a total of 1,006 valid responses were collected from zakat payer users in Saudi Arabia and Egypt using a Web-based survey. To validate the research model and draw significant insights, SmartPLS structural equation modeling was used. Findings By analyzing both Saudi and Egyptian samples, the authors found that all UTAUT constructs are statistically significant, except for effort expectancy in Egypt. The effects of self-efficacy and social isolation on ZakaTech adoption are supported across both countries. Trust in technology reduces users’ inherent risks and increases their likelihood of adopting ZakaTech services in Saudi Arabia, while this is not the case in Egypt. However, the study revealed that trust in electronic-zakat systems (EZSs) is a vital predictor for mitigating perceived risk among Egyptian users of ZakaTech, but it is not the case in Saudi Arabia. Moreover, significant gender differences were found between males and females in the adoption of such digital services in both countries, particularly regarding self-efficacy, trust in EZSs, social isolation and social influence. Practical implications The results provide meaningful insights for policymakers to find ways to develop strategies to escalate the adoption of technology in zakat administration and also to create awareness among the users of ZakaTech in a gender-balanced manner that will include zakat payers and recipients as well in the hope that the digital gender divide will be bridged. Bridging the digital gender divide in this regard is imperative for sustainable inclusive development of zakat. Further, strategies need to be developed to provide incentives to zakat authorities and zakat organizations that adopt technology in managing zakat. This is important to escalate the process of fusing technology with zakat, which is an important social finance tool to eradicate poverty in the world. Originality/value This research serves as a building block for literature by empirically testing an integrated model of UTAUT-SCT within a modern and unique related context like ZakaTech. Also, it adds value by testing gender disparities in ZakaTech adoption among Muslims.

New insights on social finance research in the sustainable development context

“…Hassan et al (2021b) examine the challenges and opportunities for Islamic social finance institutions and practices, such as microfinance, waqf, and sukuk. Bin‐Nashwan et al (2023) explore the increased use of technology in managing and distributing zakat, a key pillar of Islamic philanthropy. Hassan and Muneeza (2022) emphasize the importance of good governance and anti‐corruption measures in Islamic social finance institutions, especially during times of vulnerability such as the pandemic.…”

“…Muneeza A. is one of the most active authors, with nine studies published. The main topics are related to the Impact of COVID‐19 on Islamic social finance (Hassan et al, 2021a; Hassan et al, 2021b), the adoption of ZakaTech during the time of COVID‐19 (Bin‐Nashwan et al, 2023), and the need to eliminate mismanagement and corruption in Islamic social finance institutions (Hassan & Muneeza, 2022). These studies mainly examine the impact of the COVID‐19 pandemic on Islamic social finance.…”

Digital zakat management, transparency in zakat reporting, and the zakat payroll system toward zakat management accountability and its implications on zakat growth acceleration

“…This adoption brings various benefits, such as facilitating Zakat collection, distribution, and reporting (Mohd Nor et al, 2021). Digital Zakat platforms and applications provide improved accessibility for muzakki to pay Zakat online conveniently, quickly, and securely (Bin-Nashwan et al, 2023;Rahayuningsih et al, 2021). Furthermore, technological advancements enable more efficient management of mustahik data, ensuring timely and accurate Zakat disbursement (Dirie et al, 2023;Kudhori & Pandowo, 2022).…”

The effect of digital zakat and accounting on corporate sustainability through financial transparency

“…The blending of digital technology with financial and ethical concerns emerges as a formidable force for good change when organizations begin their path towards sustainability (Gorina, Gordova, Khristoforova, Sundeeva, & Strielkowski, 2023;Pincus, Stout, Sorensen, Stocks, & Lawson, 2017). The investigation of improving company sustainability through Digital Accounting (DA) and Digital Zakat (DZ) is one such convergence of technology, finance, and social responsibility (Bin-Nashwan, Ismaiel, Muneeza, & Isa, 2023;Harahap, Risfandy, & Futri, 2023;Utami, Suryanto, Nasor, & Ghofur, 2020;Voronova & Umarov, 2021). The combination of digital accounting methods with the idea of Zakat, which is an important part of Islamic finance that stresses giving to others, creates a unique chance to change the way corporate social responsibility is done (Qudah et al, 2023;Uddin & Mohiuddin, 2020).…”