Zakat as an instrument of poverty reduction in Indonesia

Abstract

Purpose This study aims to analyze the concept of Zakat as an instrument to increase the economy and poverty eradication in Indonesia. Design/methodology/approach This study used a qualitative method based on library research sourced from books, financial reports and another previous research. Findings The results show that the empowerment programs conducted by Zakat institutions in Indonesia are based on the scale of priorities and the potential of Mustahik. Zakat management considers the level of productivity and long-term impacts that improve Mustahik Economy. Thus, the empowerment programs lead to the reduction of Mustahik living below poverty line. Research limitations/implications This study contributes in two ways: first, it analyzes a model to identify the Mustahik’s potential for the Zakat institution in Indonesia. Second, it encourages the awareness of Muzakki and Mustahik regarding the role of Zakat in the Indonesian economy. This is expected to prompt their level of participation in optimizing the potential of Zakat in Indonesia. Originality/value Given the scarce literature that provide qualitative and critical reviews of the implementation Zakat empowerment programs to alleviate poverty conducted by the Zakat institutions in Indonesia, this research can act as a bridge for future research in performing empirical studies regarding the impact of a Zakat empowerment program on society.

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

“…This trust, in turn, motivates more individuals and organizations to participate in Zakat giving, leading to increased Zakat collections (Mahmood et al, 2021). Additionally, accountable Zakat management ensures efficient resource utilization, maximizing the impact of Zakat funds on poverty alleviation and social welfare (Herianingrum et al, 2023). As Zakat institutions demonstrate accountability, they are more likely to explore new outreach strategies and innovative projects, further attracting muzakki contributions and accelerating Zakat growth to benefit the less fortunate and promote societal wellbeing.…”

“…Consequently, this will accelerate Zakat growth as people become more confident and motivated to fulfill their obligations (Mohammed et al, 2021). Moreover, the improved collection and targeted disbursement of Zakat funds will positively impact the economic growth of the mustahik community, ultimately creating a more just and sustainable social environment (Herianingrum et al, 2023).…”

Analysis of the zakat village model for economic sector utilization: ANP approach

“…The empowerment program implemented by zakat institutions in Indonesia is based on a scale of priorities and mustahiq potential to achieve productivity and long-term impact. Finally, empowerment programs reduce the number of individuals living below the poverty threshold (Herianingrum et al, 2023).…”

“…According to data from the Central Bureau of Statistics of Indonesia (2022), the poverty rate in March 2022 was 26.26 million. One way to reduce poverty is community empowerment using zakat (Abdel-Hameed Bashir, 2018;Asad Zaman, 2018;Herianingrum et al, 2023;Widiastuti et al, 2021). Zakat has excellent potential in the East Java area of IDR 547.4 billion (Badan Amil Zakat Nasional, 2021).…”

Zakat for Humanity in Disaster Mitigation

“…Efforts should be made to integrate the Zakat approach with long-term development programs to address the root causes of poverty and vulnerability. It includes improving access to education, healthcare services, and economic opportunities to enhance community well-being [90,91].…”