Muzakki and Mustahik’s collaboration model for strengthening the fundraising capacity of Islamic social finance institutions during COVID-19

Abstract

Purpose This study aims to examine how muzakki (zakat donator) and mustahik (zakat recipients) collaborated to strengthen the fundraising capability in Islamic social finance institutions (ISFIs) during the COVID-19. Design/methodology/approach This study uses a descriptive qualitative method in conjunction with interview techniques. Interviews with muzakki of various professions were conducted, as well as data from field documentation, to develop a collaborative model of muzakki and mustahik in strengthening the fundraising capacity of ISFIs. Findings The findings indicate that muzakki employed as civil servants, BUMN (state-owned enterprises) employees and entrepreneurs continue to pay zakat through ISFIs and support mustahik, whereas muzakki affected by the COVID-19 pandemic reduce their zakat spending. Consequently, with the collaboration of mustahik and muzakki, a framework can be developed to strengthen the strategy for raising funds for ISFIs. By empowering mustahik with businesses, ISFIs can increase the collection of zakat funds. Research limitations/implications The collaboration model would strengthen ISFI's ability to raise Islamic philanthropic funds and optimize their management. The basis for the regulation is contained in Law No. 23 of 2011 which allows collaboration between institutions and other stakeholders. In addition, the role of ISFIs does not end with the collection and distribution of funds, they also maintain the muzakki and mustahik's cooperation, so a significant role is required in involving muzakki and mustahik for them to collaborate and synergize, as well as improving the quality of human resource from Amil (zakat collector) to implement the strategy. Originality/value Few studies have been conducted in collaboration with Muzakki and Mustahik to develop models or frameworks for strengthening fundraising capabilities in ISFIs. Most of these studies are illustrative. Through collaboration between Muzakki and Mustahik, this research establishes a new model for enhancing the strategy of Islamic social finance fund raising to establish a sustainable system for ISFIs.

Socio-demographic correlation to zakat participation during the Covid-19 pandemic in Indonesia

“…During covid-19, the role of zakat is very large, proven in various countries zakat helps the community not only in Indonesia (Ascarya, 2021;Fithor et al, 2021) but also other countries such as in Malaysia (Zahri et al, 2023) and Nigeria (Umar & Danlami, 2022). Another thing that needs to be done in an effort to increase zakat participation is collaboration between mustahik and muzzaki (Herianingrum et al, 2022). Nowadays, financial technology even plays an important role in zakat collection activities (Shaikh, 2020).…”

New insights on social finance research in the sustainable development context

“…As evidence of collaborative endeavors in producing joint studies, Although 811 authors were considered in this study, Figure 10 shows only authors with at least two studies published and one cited. Finance (Hassan et al, 2021a;Hassan et al, 2021b;Herianingrum et al, 2022), the sustainability index , the nexus between Islamic social finance, human resources, governance, and poverty (Widiastuti, Prasetyo, et al, 2022), integration of sustainability in Islamic finance . At this point, it is important to mention that authors from this set of clusters carry out their research mainly in Asia and were mainly formed in 2022.…”

“…Among the most prominent of these is a group of clusters formed by Muneeza, Hassan, Beiki, Widiastuti, and Ascaray, the most relevant authors measured by published studies, as confirmed in Figure 4. The main topics addressed by this group of authors are mainly COVID‐19 and Islamic Social Finance (Hassan et al, 2021a; Hassan et al, 2021b; Herianingrum et al, 2022), the sustainability index (Widiastuti, Robani, et al, 2022), the nexus between Islamic social finance, human resources, governance, and poverty (Widiastuti, Prasetyo, et al, 2022), integration of sustainability in Islamic finance (Widiastuti, Robani, et al, 2022). At this point, it is important to mention that authors from this set of clusters carry out their research mainly in Asia and were mainly formed in 2022.…”

Good Governance for Zakah, Infāq, and Ṣadaqah (Zis) Collection Within Local Communities:a Case Study in Gorontalo Regency

“…Thirdly, collaborative evaluation. By involving various institutions in the evaluation process, zakah institutions can ensure that zakah funds are utilized appropriately and in line with the designated objectives (Herianingrum et al, 2022). Furthermore, collaborative evaluation has aided zakah institutions in identifying community needs more effectively and designing more efficient programs to meet those needs (Kartini & Muarrifah, 2023).…”