Zakat Fund: Concept and Perspective Moid U.Ahmad

Key discussions… Concept of Zakat. Concept of Zakat Fund. Findings from a survey on Zakat.

What is Zakat? Zakah is one of the fundamental tenets of Islam made obligatory on them since 2 Hijri or 624 AD. It is a right of the poor Muslims on the wealth of rich Muslims.

Quoting from the Holy Quran… Surah Taubah, verse: 103 “Of their properties, take alms, so that you might purify and sanctify them” Surah 2, verses 43; 83; 110; 177; 277 “And be steadfast in prayer, Practice regular charity; and bow down your heads with those who bow down (in worship).” “Treat with kindness your parents and kindred, and orphans and those in need; Speak fair to the people; Be steadfast in prayer, Practice regular charity”

How Zakat is Calculated? Possession of a minimum level of wealth for a complete Islamic year makes Zakat obligatory @ 2.5 % on this wealth. This is minimum level is termed as ‘Nisab’. Wealth for Zakah includes Gold, Silver, Live stock and Trade goods. 3 ounce of Gold or 21 ounce of Silver or all wealth clubbed together.

Why Zakat Fund? An exclusive authority will be created which will deal with the technical and religious matters of Zakah. This authority will be responsible for daily operations such as calculation, collection, maintenance and distribution of Zakah It will ease the process for the payer as well as for the receiver of Zakah. This will enhance the efficiency of activities involved in the process of poverty alleviation through Zakah by professional management of the fund.

Utility of Zakat Fund. To provide items of need to the poor. To promote entrepreneurship. To establish orphanages. To establish educational institutions.

The perspective on Zakat Fund. Eighty percent of the respondents were below 40 years of age. A big 28% of respondents who are educated, earning over two lakhs per annum ( 80%) and of mature age have never paid Zakat. All the respondents are against any political involvement in the fund with a preference towards Muslim religious organization and then charitable organization.

60% strongly agreed with the concept where 4% strongly disagreed. Such a fund should be managed only by Muslim NGO or a Muslim organization. 59% respondents were against integrating this Zakat fund with mainstream financial system. 50% respondents are of the opinion that fund should be used for education and 25 % go for entreprenurship.

Further scope of study A critical study of the performance of similar funds in operation. The scope and domain of such fund.